There are many ways the MRO supply chain can cost your organization money, including lost production, idle labor, rescheduling previously scheduled maintenance, expedited shipping, transactions costs, vendor management, etc.
At some point, they need be addressed. Building a successful integrated supply program requires an initial engagement that identifies and takes advantage of the “low-hanging fruit” ripe for savings. However, it is sustaining those savings year-over-year where the true value is earned.
For one large international health & beauty product manufacturer, the idea of initiating a relationship with a third-party MRO service provider came down to a single KPI – savings. The objective was to reduce year-over-year material spend.
The client’s massive complex, stretching over a full square mile, included multiple manufacturing plants producing various products. However, there was no process standardization and no visibility to what was needed vs what was purchased. The client did not know what parts it needed or when. What the client did know was that the MRO program was out of control.