MRO Supply Chain Best Practices for Resilient Operations

How to implement resilient MRO supply chain management across manufacturing industries

From pharmaceuticals and life sciences to food and beverage, automotive to chemical processing, manufacturers are navigating a period of rapid transformation: both industry-specific pressures and broader challenges affecting all sectors. These changes are also affecting the maintenance, repair, and operations (MRO) supply chain within those industries and others. This article considers some of these developments and their impact before exploring how best practices in MRO supply chain management, particularly around data, help to ensure resilience during times of change and beyond.

Drivers of change

Headlines suggest that one of the biggest drivers of change for manufacturers, indeed all businesses, is Artificial Intelligence (AI). It is certainly a topic of conversation, says Susan Vasey, General Manager for RS Integrated Supply. She is seeing a huge amount of curiosity around AI but less progress in terms of scalable implementation – at least so far.

“We’ve been talking about digital twins for a long time. We’ve been talking about big data for a long time. The AI conversation feels a bit newer but it’s almost an iteration on these concepts,” she says. “Some of our client base is extremely innovative and digital led and has the capacity and funding to explore innovation in an incubator type fashion. There’s certainly a level of curiosity about AI but how do we turn that into something systemic? Building it meaningfully into production systems and operating platforms will be the next challenge.”

An issue that is here now and having an impact is labor shortages. “Some customers are having a harder time finding skilled talent,” says Vicki Byrd, Account Director at RS Integrated Supply. “Ever since COVID, it’s been a rocky road getting the right people into the right positions.”

This is affecting the MRO supply chain, with lead times getting longer as a result. “We’ve had lead times pushed back not because the materials weren’t there but because the supplier didn’t have enough team members to fabricate the parts,” says Deon O’Bryant, Account Director at RS Integrated Supply. “Because parts may be taking longer to get to us, we’re having to look at potentially increasing stock holdings.”

Derisking just-in-time

Recent economic changes are having an impact too. “Companies within the US are still watching their dollars and cents,” says Byrd. “The cost of money and storing products is high.” There has been a shift towards a more just-in-time model as a result, she adds.

This move towards just-in-time must, however, be well managed to avoid increasing the risk of stockouts and, in turn, greater downtime. “You need clean, accurate data for efficient sourcing and inventory management,” says O’Bryant, but this can be in short supply when you onboard a new client.

You need to obtain the data and then work with the customer, he explains. “Clients do not want to add to working capital in terms of inventory that’s sitting there but we may need to talk to them to say this part now has a longer lead time so are you okay with us adding more parts to stock so that you don’t run out? It’s about having the correct data so clients can make the best decisions.”

Data-driven decision making

Clean, accurate data underpins resilient MRO supply chain management in other ways as well. “It allows you to provide the right product at the right time,” says O’Bryant. “You’re not carrying two different SKUs where it should be just one. You can also optimize your inventory and ensure it’s the right size for the client.

“It helps with maintenance planning,” he adds, “because it’s easier for us to source items. Take a flange bearing with a two-inch OD, 3.5-inch ID and 8.5-inch footprint: when the data is clean and accurate, we can find it quicker and they can install it quicker. We can also say that this may not be the exact part that you had ten years ago but we know it will work. It really helps.”

Byrd agrees that accurate data is crucial. “Good, clean data is top of my list of best practices in MRO supply chain management,” she states. “It is number one because it opens a lot of doors to be able to source multiple suppliers for products. We can find other options for the manufacturer without a long-drawn process of procurement research. It’s a few clicks of the keyboard and we have that information readily available, which reduces the workload.”

The rapid availability of relevant data through RS Integrated Supply’s centralized platform helps too. “Having the information available to make decisions quickly allows us to not stock as much material on behalf of the customer so that reduces the cost of inventory,” continues Byrd.

“Data provides visibility and once you’ve got that visibility, then you’re in control,” says Vasey. “You can see what stock rates are and you see whether there are opportunities. We recently did a wholescale stock profile review for a customer where we saw that with the existing reorder points that the customer was using to manage their MRO supply chain, it would drive their stock holding to £7 million. If they adopted the reorder points that we suggested, the optimal stock holding would be closer to £4 million. That’s a clear benefit.”

The value of standardization

Clean, accurate data is standardized data – and standardizing data across an enterprise further strengthens resilience in the MRO supply chain and drives MRO best practice more broadly.

With standardized data comes standardized parts, which helps with price and has other advantages, says Derick Thompson, Senior Account Director at RS Integrated Supply: “I’ve seen in the past where we’ve standardized to certain bearings, motors or gearboxes and it has created a partnership with either the distributor or manufacturer. If your entire plant is using their items, you’re going to get better support.”

Standardization can help with predictive maintenance as well. “With one client, we introduced a partnership program with a motor manufacturer and one of the benefits was internal vibration analysis on all their Bluetooth pump motors,” recalls Thompson. “This plugged right into the customer’s reliability program. It brought that technology into their environment and allowed them to track without having to create anything.”

This is the goal of MRO best practice, says Thompson: to enhance client operations. “Getting a solid understanding of what your program is going to bring to the client is really important,” he argues. “Then we can get on with running things efficiently and effectively – and the customer never has to worry about having the right MRO materials available.

The biggest compliment we can get from a customer is that everything is so seamless, they don’t even know we are there.”

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