Uncovering the business benefits held in MRO materials.

MDO MDM Datasheet

Forrester report

Asset-intensive industries that are taking on the challenge to improve their MRO data are gaining a competitive advantage. Short for Maintenance, Repair, and Operations, these items comprise components and consumables that contribute to the production of finished goods. MRO materials are much more difficult to create, purchase, and maintain when compared to direct materials and therefore present their own unique set of data management challenges.

Data Governance Structure

Establishing the governance framework that all MRO materials will be measured against is critical in keeping materials aligned and standardized in a way that meets the needs of the business. When there is a data governance structure in place, there are consistent naming conventions, which gives the business the ability to identify and remove duplicates, reduce free-text spend, and trust the data being presented.

Optimize Working Capital

The purpose of having MRO inventory stocked on-site is to reduce the risk of plant and equipment downtime. These materials can make up a very large part of the total working capital of a business so managing these materials is very important. MRO materials are often overstocked for fear of running out and impacting operations. If not kept in check, working capital easily accumulates in these indirect materials, especially if the spares have either become obsolete, damaged, or pilfered, rendering them completely unusable, but still on the balance sheet as an asset of the business.

Procurement Enablement

Once a material has been cataloged, everything changes. The information required from the other parts of the business is captured once and converted into master data that will then drive future requirements. If the material is again required most ERP systems will present the information that was entered into the last purchase order to help the Buyer convert the purchase requestion quicker. All faster-moving materials should be placed on a contract so that all future requirements will automatically generate a purchase order. Automation helps to reduce lead times which reduce stock levels.

ROI for indirect materials for mining

Article

MRO Cataloging Vlog

Video