How To Tackle Today’s MRO Challenges
The right strategic supplier can make a significant contribution in solving some of the big procurement issues, says Will Brummett, Vice President of Sales, North America, for RS Integrated Supply
In a 2021 global survey of indirect procurement professionals conducted by RS and the Chartered Institute of Procurement and Supply (CIPS), respondents shared the biggest challenges within Maintenance, Repair and Operations (MRO) today. From balancing costs to reliability, sourcing the right PPE to developing maintenance strategies, data on total cost of ownership to evidence of Environmental, Social and Corporate Governance (ESG), their concerns represent both longstanding issues and newer ones.
“I have spent a great deal of time talking to engineers, maintenance and procurement professionals involved in MRO,” says Will Brummett, Vice President of Sales, North America, for RS Integrated Supply. “I have learned a lot about the challenges they face.” Here, Brummett outlines these concerns and how trusted suppliers can help organizations find solutions.
1. Rationalize the supply chain
In the 2021 RS and CIPS survey, 19% of respondents said the coronavirus pandemic had accelerated supplier rationalization.
MRO…can be difficult to manage
The challenge? Balancing costs. MRO often represents a small percentage of an organization’s spend but it can also be difficult to manage.
The solution? Many of those responsible for indirect procurement pursue a policy of reducing the number of suppliers used, focusing on trusted partners that offer product selection, good value, technical backup and other resources such as value-add services for procurement, inventory and maintenance.
2. Manage Supply Chain Disruption
54% of respondents said COVID-19 had caused supply chain disruption. The war in Ukraine has now exacerbated this problem.
“It’s no longer just about costs, now it’s about managing risk.”
Andrew Perry, Senior Vice President, Operations, RS Integrated Supply
The challenge? Reliability. The lean manufacturing model can no longer provide the continuity of supply for critical parts that businesses need. As Andrew Perry, Senior Vice President, Operations, RS Integrated Supply, puts it, “It’s no longer just about costs, now it’s about managing risk.”
The solution? Those working in MRO are developing proactive maintenance regimes and are looking for suppliers who can support this approach by reacting quickly and offering flexibility. To minimize downtime, they want suppliers that have immediate availability for many products without compromising on quality or competitiveness – seeing brands that they recognize and trust such as RS Pro provides reassurance.
3. Collaborate With Suppliers
36% of survey participants said collaboration with suppliers had increased.
The challenge? PPE is more important than ever.
The solution? A supplier such as RS Safety Solutions that offers insights, expertise and appropriate specialist and technical knowledge. Those in the food and beverage industry, for example, require a supplier that understands their need for PPE that protects both the person and the product. Likewise, those in heavy industries require a supplier that understands the PPE demands within hazardous environments. Value-added solutions that support effective management of PPE, such as industrial vending for lineside availability of products, are important too.
4. Plan For Equipment Maintenance Monitoring
Just 18% said their organization had a condition monitoring strategy in place.
Proactive maintenance strategies…are essential for minimizing costly downtime
The challenge? Proactive maintenance strategies such as a condition-based monitoring are essential for minimizing costly downtime.
The solution? Engineers working in production environments need reliable systems for condition-based monitoring, preventative maintenance and general maintenance to help predict failure before it happens.
5. Calculate Total Cost of Ownership
68% said managed inventory services provided better visibility of stock and spend.
Total cost of ownership (TCO) has become paramount
The challenge? Product price remains important but now it’s only one factor. Total cost of ownership (TCO) has, instead, become paramount.
The solution? Suppliers that can deliver value to customers beyond simply cost price. Value-added solutions make a substantial contribution to this. Examples include RS ScanStockâ, a managed inventory system, RS PurchasingManagerâ, an eProcurement system, and RS ConnectPointâ, a touchscreen unit providing access to more than 500,00 products and services where no computer is available.
6. Make ESG a Key Consideration in Demand Planning
64% of respondents said their organization had a strategy in place for sustainability and ethical procurement – and 46% said sustainable and ethical procurement is now a top business pressure.
The challenge? ESG is high on many corporate agendas.
Make ESG a big part of the criteria when awarding contracts
The solution? Make ESG a big part of the criteria when awarding contracts. Insist that suppliers provide evidence such as independent verification of their sustainability credentials to demonstrate how they, and their products, are contributing to a better future for people and planet. RS Group, for instance, received the prestigious platinum level sustainability rating from Ecovadis in 2022.
Indirect procurement professionals face many challenges in the MRO space from balancing costs to sourcing PPE to developing maintenance strategies. The right supplier can help address these issues by offering solutions such as reducing the number of suppliers, collaborating for effective PPE management, strategizing for condition monitoring, calculating total cost of ownership, and prioritizing ESG.
RS Integrated Supply is a trusted supplier and we help organizations navigate the complexities of the MRO space and ensure that their procurement processes are efficient, cost-effective, and sustainable.