Almost all production and service industries have high demands for asset uptime. Asset downtime could have disastrous consequences such as lost revenue due to production stagnation or even severe safety issues (e.g. at nuclear power plants). To minimise the downtime of an asset, maintenance must be performed and this means having the right spare parts in stock.
However, especially for capital intensive assets, regular and proper maintenance can be costly. Think of the stock holding costs associated with the working capital of spare parts, the operational costs of transport and stores, and the transactional costs at the purchase department.
Today, more and more companies recognise the importance of achieving a balance between uptime and costs but struggle to embed an appropriate strategy. The reasons for this are diverse but include a lack of spare parts expertise, lack of recognition for the role of the spare parts management department, and the lack of a proper IT system to cope with the characteristics of spare parts and asset management in general.
The goal of this white paper is to provide practical thoughts and concepts for an effective spare parts management organisation and process. After illustrating the unstructured world of spare parts management challenges, we provide an effective concept to create structure and focus by applying different strategies to different sub assortments. Then we propose practical and specific solutions to solve the most common issues. We conclude with recommendations.