By Lance Gilbert, Managing Partner, Net Results Group, LLC

During these uncertain times, companies focus on their direct materials and keeping production moving. They fail to see the relationship between their MRO indirect materials and keeping the cost of production down. Most companies have a primary goal of being a “low cost provider.” Yet, without focusing entirely on excellence in maintenance repair and operations (MRO), these companies lose a huge competitive advantage.

To help ensure your business maintains their focus on excellence, we will be releasing a series of articles that discuss how to formulate a strategy to achieve necessary competitive advantages and how to establish and attain your own short-term goals in MRO and indirect materials.

Included in the series will be articles that help you formulate:

• Supplier Cost Reduction Strategies
• Indirect Material Inventory Reduction Strategies
• Methods to Increase Productivity with Higher Wrench-time
• Inventory Rationalization and Strategies for Sharing Across the Enterprise
• Strategies to Remove Obsolete Spare Parts and Identify Discontinued Spare Parts
• Accurate and Measurable KPIs for Strategic MRO Excellence.

Each article will delve into core competencies towards:

This first in our series addresses Master Data Management for MRO Indirect Materials and the foundation it serves towards your overall MRO excellence.

WHY MASTER DATA MANAGEMENT?

In short, knowing exactly what you have and being able to search and find it, is the primary building block of MRO excellence. Once you have the data defined, standardized and cleansed, you can make smarter and faster decisions towards your MRO goals.

Without master data management strategies for MRO indirect materials, your enterprise will experience, or may already be experiencing, the following problems causing your company to incur unnecessary costs:

• 30% of your MRO spare parts will never be used
• 67% of your MRO spare part will never be used in the first 3 years
• 50% of open work orders are waiting for spare parts / indirect materials
• At least 16% of your enterprise system inventory has duplication which unnecessarily inflates inventory levels
• 52% of your spare parts will become obsolete before they are used

Consider employing critical foundational strategies to mitigate those noted problems, some of which include:

• Standardize your data based on the noun and modifier of every spare part. Take advantage of industry specific templates to correctly and accurately perform data cleansing and cataloging your spare parts in the item master.
• Enhance missing data by appending attribute values critical to defining a part’s specifications. Having the right noun and modifier templates define which attribute values are required is of extreme importance to your data governance and setting up your EAM and CMMS systems.
• Adopt a data management software solution that works best within your workflow and processes. Critical to achieving your MRO excellence is having a software that works for you and not against you. Setting up data quality standards and ensuring that duplicate items are not created is crucial to avoiding costly mistakes.

Your company can either perform these strategies internally or outsource data scrubbing methods to companies like Net Results group.

HOW DOES DATA SCRUBBING CONTRIBUTE TO MRO EXCELLENCE?

If you perform data cleansing services internally, you may still want to consider having your resources subscribe to intelligent data tools, such as cloud-based data management software solutions offered by data cleansing companies, to ensure an effective process for your enterprise.

Should you choose to outsource this effort, advantages to using a data cleansing service will offer:

• Access to millions of already cleansed data on MRO spare parts which will speed up the production of data scrubbing.
• Having easily configurable workflow tools that create an efficient and prolific process.
• Access to best practices and data governance techniques to ensure sustainability of your MRO master data.
• Experienced MRO industrial parts experts across all commodity codes and who understand how maintenance operates.
• Cross reference to spare parts of different manufacturers that perform the same form, fit and function.
• MRO master data solutions that best fit your company’s needs across the enterprise, including maintenance, procurement, IT, accounting and finance.

Informed decisions depend on accurate and quality data to move toward MRO excellence. Contact NRG for assistance improving the quality of your master data.