Maps improve the MRO buy

by Dr. Robert A. Kemp

Knowing that MRO almost always includes . . .
1) many low-dollar, unplanned purchases;
2) lots of slow-moving inventory;
3) users dedicated to special tools, processes or suppliers;
4) resistance to change; and,
5) upward of 20 percent of the total spend
. . . should lead managers to search for better management processes.

Creating and examining a map for the MRO commodity management process will quickly challenge the status quo. This article includes a map and suggestions for changing your organizational structure, processes and people. Remember: You must change people, processes and structure to ensure success.

Each commodity team is responsible for developing and implementing the strategies, developing and selecting the suppliers, negotiating contracts, monitoring supplier performance to include quality and delivery, and meeting goals in terms of leverage, cost reduction, supply base rationalization and service.

The main goal is better on-time supply management at the lowest possible costs. Training, new organizational techniques and technology can help us meet that goal.

To view the map, click here.

Robert Kemp is a consultant, speaker and the former president of the Institute for Supply Management. He can be reached at . 

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