by Jim Clifford, Director of MRO Services, PCA
and Dan Moss, Director of Operations PCA

In production environments, maintaining inventory levels can be one of a facility’s greatest challenges — and opportunities. Too much inventory costs the firm money, but inventory levels kept too low don’t provide sufficient planning and scheduling flexibility. This is true not only for finished inventory but also for “support” inventory, such as the parts and supplies used to maintain equipment in peak condition.

A lean approach to inventory management has long been a best practice in well-run facilities. However, in the current roller-coaster environment, where production facilities are striving to meet spikes in demand without reopening plants or retooling existing ones, too-lean inventory levels can cause bigger problems than they have in the past.

At the same time, production managers are being challenged to shorten lead times even more to push more finished products through the pipeline faster, allowing planners and schedulers to accelerate production timelines. Today’s accelerated production lines require even more parts and supplies managed even more efficiently, yet many facilities haven’t mastered inventory management at historic production levels, let alone at new higher rates.

Does this sound like a recipe for disaster? It certainly can be, but there are ways to avert it.

Back to Basics

Before planners, schedulers and storeroom managers throw their hands in the air — or walk out the door — they should all take a trip “back to the basics.” When production spikes, best practices tend to be forgotten in the haste to meet production goals. A leader with decision-making authority must be tasked with ensuring this doesn’t happen. From that point, planning, scheduling and storeroom personnel (with the help of outside consultants if no one has enough time to devote) should take a hard look at what they have been doing, or not. From there they can decide what changes will bring about the most change, quickly and successfully.

A quick review of current plans and processes often yields obvious areas where best practices are being ignored or overlooked in the haste to push the production. Following are two for which we recommend review.

Master Production Schedule

Does your Master Production Schedule (MPS) consider the heightened demand for spare parts and supplies in a time of accelerated demand? Is the increased value of production downtime reconsidered against the store stock decisions made in the past? Have inventory plans and ordering lead times been adjusted to account for shortened production lead times? If your facility’s environment is focused on Assemble to Order, has your spare parts plan been updated to address the most granular levels of the MPS all the way down to the subassembly level? If equipment is running at a higher throughput then parts will wear out proportionately.

Inventory Management Refresh

Are staff still clinging to outdated inventory management approaches that need retooling? Excessively tight inventory levels are one challenge but there are others. For example, outdated, inefficient processes such as poor management of obsolete inventory (which PCA recently wrote about, here https://pcaconsulting.com/obsolete-inventory-addressing-an-enemy-of-efficiency/) can bloat apparent levels in the system. That makes it even harder for staff to ensure truly necessary parts and supplies inventory is sufficient to support planning and scheduling. If the organization is moving to a “just-in-time” model, then maintenance inventory managers must move with it, ordering more frequently at sufficient levels, and develop innovative solutions to bolster vendor relations.

The Final Outcome

At this point, you may be asking yourself, “Would added improvements, such as expanding computerized production scheduling, be more effective?” It’s possible but those fixes take time and require considerable workflow modeling and testing. And even these enhancements will be sub-optimized if the foundational elements of proper inventory control are not in place. Any production operation can make great strides towards minimizing the negative impact of tightened inventory control by implementing sound inventory practices.

At the end of the day, if parts and supplies that keep production equipment humming are not available when needed, equipment —and by extension, systems — can fail. Orders stack up or staff improvises with quick, interim fixes that are always a bad idea. Start with the basics and work your way up from there.