Keep supply lines intact with basic storeroom care

Aug. 5, 2014
Almost every industry is facing a hardship when it comes to effectively supplying the bullets and beans to keep our equipment and our efforts moving forward.

In combat, you want a field general who is a great leader, but, you’d better have a supply sergeant who is a good manager. Getting supplies to the front lines is important, and planning and scheduling troop movements and all that goes with it is logistically taxing and very complex. Not only are the operations of a war machine important, but so are the functions of the rear echelon. You can’t eat bullets, and you most certainly can’t shoot beans.

Studying and understanding the vital criticality of supplying the troops and effectively cutting off an enemy’s supply line is Military Strategy 101. Outrunning your own supply line is often times simply suicidal. Failing to effectively manage that supply line by moving it forward with the battle, anticipating needs and responding to the plan, has the same effect as not having a supply line at all. No sustained military effort can operate without a solid understanding of bullets and beans. Metaphorically, neither can a sustained manufacturing effort.

Success on the battle field of today’s manufacturing plant often depends on logistic maneuvering and the alignment of the strategic initiatives with tactical deployment. Quite honestly, this is a battle that we in manufacturing might not be winning. Our strategic initiatives are moving forward with the battle, but our tactical deployment, logistically speaking, is being outrun.

Thankfully, we aren’t talking about a real war, at least not the kind where people are shooting at each other. Nonetheless, we are in a kind of battle, an economic war of attrition. The spoils of this war are billions of dollars, millions of jobs, and the vitality of fiscal security.

Our success in manufacturing in a global market place is measured quite simply by our ability to bring a product or service to market at a cost, quantity, and quality that is attractive to the buyer. We can’t compromise quality; quantity demands are high; and we have to keep costs in check. Unfortunately in this era of drone strikes controlled from oceans away, we are quite literally applying the same tactics we used in the previous century — the 20th century.

We are nearing the end of the third year of the second decade of the 21st century. It is time to get rid of the pack mules and get this army rolling.

Now, comparing plant manufacturing to war is really just hyperbole meant to jumpstart the conversation. If you haven’t figured it out yet, bullets and beans are MRO parts: stuff, really. Perhaps a cleverly placed simile would have served the purpose better. But sometimes it helps to put things into the context that, for many of us, getting maintenance done in a manufacturing plant is like being in a fight.

In maintenance, our tactical process for controlling costs and getting the work done effectively and efficiently is planning and scheduling. It should come as no surprise that planned work is traditionally less expensive than unplanned work by a factor of 3 or 4. Without going into too much detail, consider that arguably the major source of input into the planning process is the result of well-executed preventive and predictive maintenance processes.

Keeping with the metaphor we established earlier, as the operation rages on, the rear echelon is supporting the war effort by conducting well defined and well-constructed preventive and predictive maintenance. Presumably, those measurements and inspections are netting corrective maintenance requests, which are then put into the planning and scheduling process. It is within that planning process that we formally start to talk about bullets and beans: the parts.

Where in combat the front line operations seem at times to be quite chaotic, the war map located well behind the lines of battle seems to make sense. Keeping with Deming’s “constancy of purpose,” the fighting forces involved need to move forward, and support from the rear echelon needs to be enhanced to support the aggressive effort — both units moving with an eye on the same objective. Constancy. Notably, plant operations and maintenance have worked for decades to move toward an inclusive partnership and away from an exclusive customer-supplier relationship. Clearly a partnership leans more toward having a constancy of purpose.

Within the spirit of forming partnerships to unify our forces, a common issue is beginning to get more attention. Almost every industry is facing a hardship when it comes to effectively supplying the bullets and beans to keep our equipment and our efforts moving forward.

There are many reasons for this. The world has gotten smaller, and more production equipment is designed and built outside the United States, often times in Europe or Asia. This change brings along with it very long lead times and ambiguous delivery information.

Additionally, companies that have traditionally controlled MRO spare parts through their purchasing departments have moved or are considering moving that responsibility from purchasing to the maintenance department. Worse yet, some either contract out their storeroom or have a third entity within the organization in charge of these critical war materials.

Remembering back to an earlier point — failing to effectively manage that supply line, to move it forward with the battle, to anticipate needs and respond to the plan has the same effect as not having a supply line at all. And, as mentioned earlier, that is suicidal. We are failing to manage our supply lines.

If purchasing departments are responsible for MRO parts, they try to run the process like they would control principal supplies. With principal supplies, companies anticipate and plan for the use of the materials. They effectively employ their ERP or MRP software to project material usage. This is hard to do with repair parts.

Adding to the dysfunctional strategy of purchasing MRO parts like principal supplies, purchasing also traditionally has a standing order to reduce inventory any way possible.

If maintenance departments are responsible for MRO parts, they’re often ill-trained, and ill-equipped to understand that there is a real science to running a supply depot. The military has specialists to do this work; what specialists do maintenance departments have? If they have any to speak of, there is always an effort to reduce headcount. Often maintenance storerooms are reduced to one clerk, the storeroom is wide open on the off shifts, and everyone is on the honor system.

Consider the current state of our supply lines. Economic realities and company mandates have slashed away the amount of allowable inventory we can stock. Reductions in headcounts have forced our staffing to be lowered to ineffective levels, and those that remain behind the counter are often not real bullet and bean specialists. We are decimating our supply lines, and we are often strategically poised to be no better than if we didn’t have a storeroom at all. It is hard to sustain a war effort with these tactics. If we really were in a fight, the radio would crackle with this hurried and fear-induced message, “We’ve been cut off!”

There is a new tactic on the horizon: a process that can be deployed to reestablish our supply lines by bringing focus and measurable actions to the fight. It is more subtle than a Seal Team 6 activity, but it has the same zest factor of a Special Forces mission. The operation is a basic storeroom care (BSC) workshop.

Most organizations are familiar with the benefit and the excitement that comes with a kaizen event. In fact, if any have ever participated in a single minute exchange of dies (SMED) event, mistake proofing, lean effort, or Six Sigma event, you’ll recognize the value of rolling up your sleeves and getting a job done. A BSC workshop has just that level of excitement and just that net result of getting something valuable done quickly.

The BSC is accomplished, logically, through the work of the BSC team. This is a focused team associated with a specific area of a plant’s storeroom. The team is assembled to perform a quick-win kaizen event to demonstrate possibilities to enhance service and convenience.

Participation in and the execution of the BSC process will allow a consistent, repeatable, and sustainable approach to storeroom issue elimination and better service. This approach will net positive change.

Change in the overall MRO effort is necessary to raise the standards of equipment reliability and long-term service and convenience in line with achieving the vision for increased plant capacity. Benefits of effectively executing a BSC are:

  • optimized inventories
  • increased inventory accuracy
  • identification and removal of obsolete materials
  • accurate min/max levels, or application of other stocking methodologies
  • identification of overstocked materials
  • development of standard operating procedures (SOPs)
  • reduced emergency buys
  • reduced stock-outs
  • increased operational efficiencies and effectiveness
  • reduced search and downtime
  • development of supplier partnerships.

The aim of a BSC team is to improve the service and convenience of the MRO storeroom by applying foundational practices enabling the storeroom staff and leadership to deliver on their responsibilities regarding equipment reliability.

The benefit of these proactive activities, many listed above, also includes the improved communication between those overseeing the spare parts area of the plant and those requiring unfaltering support. With the involvement of key individuals in the process, ownership and pride in the storeroom will be restored.

The objective of the BSC process is to implement a standard process across the stores organization that enables and promotes effective and efficient service. This is what would be expected from a very good supply sergeant. As a result, we begin to get a sense of what a world-class storeroom would look like to be competitive in a world market.

World-class MRO operations bring to play a wide range of processes that could and should be part of a continued storeroom enhancement effort. Several of these processes are introduced during a BSC workshop:

  • storeroom cleaning
  • 5s
  • identification of obsolete and/or slow moving parts
  • storeroom physical layout
  • establishing a kitting area
  • root cause analysis (RCA)
  • establishing storeroom metrics (inventory accuracy, inventory turns, stock-outs)
  • problem solving
  • bill of materials (BOM)
  • barcoding/RFID development plan development
  • lay-up program (MRO part PM program for long-term stored items).
John Ross is senior consultant at Marshall Institute. Contact him at [email protected].

In the final analysis, we have a challenge ahead of us. Maybe not an actual war, but we are all in competition with someone. It’s a world war out there. Many of us are in industries that were hunkered down during the long economic recession, and we haven’t fully recovered. We have to come out more logistically aligned than we went in. The new battle front is in the storeroom. Our supply lines are threatened, and we run the risk of being cut off.

I’ve taken some liberties with my military-speak; I apologize if it’s been somewhat simplistic. After being an Army brat for 16 years and an Air Force officer for 10, I feel somewhat confident to draw an analogy. It was meant to provide a comparison between operations in battle and in production and the supply efforts needed to sustain both. It really is just bullets and beans.

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