Inventory control is an old concept. It has been part of the business vocabulary likely since the days of Henry Ford. The idea is to apply management science to optimize the value and effectiveness of inventory. A typical definition is the process of keeping the right number of parts and products in stock to avoid shortages, overstocks, and other costly problems.
In the world of Energy, Utilities, Mining and Pipeline companies; Maintenance Repair and Operations (MRO) materials are the key inventory type because they are so significant in maximizing asset availability, uptime, and efficient maintenance – supply chain integration. The other classic inventory types: raw materials, WIP, and finished goods are prominent in manufacturing and distribution businesses. The science of inventory control has long been more focused on manufacturing where the identity of the inventory items is a simpler and clearer challenge than in the MRO world.
For MRO inventory control, where catalogue sizes are often in the hundreds of thousands of items, item identity standards need to be a central concern or else business processes are primed for widespread waste due to the problems caused by ambiguous and indeterminate items.
If you are involved in the chain of MRO inventory control responsibility, understand that your business will have better results by having structured unique MRO item identities.
SPC Results, can guide you to applying a structured MRO material identity taxonomy to your MRO catalogue. This will clear the redundant items, enable an identity quality test at the item level, and position you to scale your MRO operations quickly and effectively as the acquirer in corporate mergers.
Let’s start a discussion on the quality of your MRO materials and how value leakage can be economically reduced.