You know that feeling when you can't find your car keys? Poor inventory management is that feeling times a hundred, stretched across your whole workweek.
The standard definition of good inventory management is having the right inventory in the right quantity, in the right place, at the right time, and at the right cost.
It's a tough balancing act for a maintenance department, but it's achievable. Inventory management software, or better yet the inventory management module built into a good computerized maintenance management system (CMMS), makes reaching every part of that goal possible.
Easy reports deliver the right inventory
No matter how many times you work on an asset using inferior materials and parts, you're not really fixing it. You're only kicking the problem down the road a bit, filling the maintenance department's calendar with more on-demand work orders without even realizing it.
Inventory tracking using the right software, makes a lot of information easily accessible, including:
- Current levels
- Delivery dates
- Serial and batch numbers
Any full-featured CMMS lets you create reports using nearly any combination of data points. If you look at historical work orders for an asset and find the mean time to failure started to shorten around the same time you switched vendors, materials and parts are likely the culprits. Once you find the ones that consistently underperform, you can quickly start purging your inventory using serial and batch numbers and recouping your money using warranties.
Customizable thresholds deliver the right quantity at the right time
Now that you've got the right inventory, you need the right amounts. You need to make sure you have enough but not too much, which can be an even bigger problem.
Inventory costs money from start to finish. You have to pay for it upfront and then you have to pay to look after it. Think back to the last time you bought ice cream. You paid at the store, which was the upfront cost, but then as soon as you got home, you put it in the freezer, which was the infrastructure you needed to keep the ice cream from becoming soup. The cost of carrying the inventory was a percentage of the price of the freezer plus the electricity to run it. Right up until you finished that ice cream, you were paying for it continuously. By holding in inventory only what you'll likely need, you shift responsibility back onto vendors, who can take advantage of economies of scale--in ways you can't--to keep carrying costs down.
It can be tempting to ignore the problem of carrying costs and focus instead on the sense of security that comes from having a lot of inventory. We tell ourselves, "Now that I have so much, I'll never ever have to worry about running out."
But here's the other problem with carrying too much inventory: when you have something for too long, it can lose its value altogether. Remember that you're not collecting rare coins or fine wines. For the maintenance department in a manufacturing facility, inventory is going to either spoil on its own or the asset it matches is going to reach the end of its useful life. Back to our ice cream example: either you're going to hit the best-before date before you can eat all of it or everyone in the house is going to suddenly decide they're on that new ice cream-free diet. Your inventory is now worthless.
When you have customizable reorder thresholds, once inventory dips below a certain level, the software automatically sends you an alert, places an order, or both. For this to work, you just need to enter the current levels, preferred thresholds, vendors' contact information, and average lead times. With a full-featured CMMS software, materials and parts are associated with work orders. When a technician closes one out, the software considers the inventory used and automatically updates the database.
Cloud-based tracking delivers the right place
Up-to-date, easily accessible levels put your inventory where you need it. Unlike spreadsheet-based or paper-and-pen systems, modern inventory management software relies on a central database accessible from any Internet-connected desktop or mobile device. Because everyone is accessing the same information, it's always current. You never have to scroll through old emails looking for the latest version of a file.
Inventory properly sorted
If you want to know how to sort inventory, think about your winter coat. Depending on the season, it's either right at the front of the hall closet or way in the back. Inventory can be sorted the same way: according to how likely you're going to need it. Is there a lubricant used in a variety of PMs throughout the month? Keep it somewhere handy. And the parts for that rare but budget-busting failure of a key asset? Maybe those can go closer to the back, where they're easy to find but still out of your way.
Inventory easily shared
Manufacturing facilities can be massive complexes, rivaling small cities in terms of infrastructure and population. Even smaller operations often involve multiple, spread-out buildings. Cloud-based inventory management software creates a shared virtual warehouse technicians can check from anywhere. Being able to share inventory across facilities is especially helpful when dealing with critical parts that are expensive but rarely used. Instead of having duplicates spread throughout the facilities, the maintenance department can have a few in a central location, with current levels available to any technician, from anywhere.
Altogether, the features deliver the right cost
It's not hard to see how every feature saves you money.
Buying the right inventory ensures you're not endlessly making the same repairs. When bad luck strikes and you get bad materials or parts, you can quickly purge your stock, review your warranties, and start getting your money back.
Automatically maintaining inventory levels means you've got what you need when you need it. Customizable threshold alerts mean never having to pay extra for rush delivery. Vendor lead times are stored in the software, so you can order ahead of time and choose the most economical shipping. And because you never carry more than you need, you're not stuck with the cost of looking after inventory, hoping it doesn't become useless, or get lost or stolen before you can use it.
Cloud-based tracking keeps everything accurate and up to date, which means you can store inventory according to what gets used most often. And because your data is accessible from anywhere and at any time, it's possible to share inventory across facilities.
Inventory management is achievable.
Having the right inventory in the right quantity, in the right place, at the right time, and at the right cost can be done, but it takes the right tools and some groundwork. But once the software and database are set up, you can start to leverage the initial investments of time and energy into real savings in time, money, and stress.
Remember those lost keys from the start of the post? Well, you just found them!