Darr Greenhalgh, senior manager of customer solutions at MSC Industrial Supply Co.
Overhauling your indirect supply chain can provide significant savings, increase order visibility, reduce downtime and boost labor productivity.
However, implementing a new maintenance, repair and operations (MRO) solution can seem daunting and risky. I know, because I’ve been brought into manufacturers after botched indirect supply chain overhauls and seen the aftermath firsthand: stockouts, service disruptions, lost efficiencies and more.
A partnership with an integrated, broadline supplier is the critical first step, but all supply chain transformations carry some risk. The most successful manufacturers tap the expertise and resources of their supplier partner while maintaining control of the overall process.
The following roadmap will help any manufacturer ensure a successful and profitable indirect supply chain implementation.
The good news: Assuming you’ve selected an experienced, strategic supplier to partner with, that partner will take the lead in designing the new system and overseeing implementation. After all, the supplier doesn’t make money until the new system is up and running.
Here’s what you should expect from your supplier before implementing the new MRO solution:
Once implementation is underway, the primary focus should be on establishing and maintaining appropriate inventory levels, identifying everything your indirect supply chain handles, and deploying appropriate equipment, such as cribs and vending machines, to manage these items.
As the implementation proceeds, issues should be identified and solutions developed. The new MRO system may touch several other departments, so cross-functional communication is vital. Any new risks that arise during implementation must be identified and mitigated. In some cases, parts of the new MRO solution may need redesigning.
Once you’ve completed implementation, you and your supplier partner will transition to normal operations. This transition should include:
Now that we’ve covered the key steps in implementing a successful MRO solution, keep in mind a few things. Some implementations fail because they have one (or more) of these three major problems:
As long as you stick to your implementation plan and avoid these three major problems, you’ll improve your likelihood of success considerably.
Overhauling your indirect supply chain is complex. It’s tempting to leave some elements out and create a “streamlined” process, but I’d recommend against it.
Manufacturers that rely too much on their supplier and don’t manage the internal processes may create a recipe for disaster. The implementation must be a partnership—a transparent, collaborative process between integrated supplier and manufacturer.
Understandably, suppliers and manufacturers may want to accelerate the process. Neither gains anything from the process until implementation is complete. But hurrying or taking shortcuts can result in costly re-dos down the road.
The most successful manufacturers focus on getting their indirect supply chain solutions right the first time, even when it means taking a little longer to complete the implementation.