Spare Parts Inventory Optimization - SOS™

Optimization of Spare Parts Inventory for Maintenance Engineering.

This tool allows you to scientifically determine ......

1. whether to hold a spare part at all, and if so...

2. in what quantity

SOS™ does not rely upon electronic recorded history. It is an expert system which bases its recommendation about spares holdings from the input provided by the assessors selected answers to a number of carefully structured questions. A combination of expert logic and assessment of economic order quantity, balanced with business cost/risk analysis, ensures that the optimum level of spares is recommended.

Note 1: 100% of all site inventories assessed (1,000 so far across all countries and process environments) have provided us with the statistics  represented by this graphic. We would expect the trend to remain consistent. On average and for all inventories assessed, 50% will remain at their present levels and of the other 50%, 75-80% will be identified as having a higher level than required (COST?) and 20-25% of that 50% will be identified at a deficient level (RISK?). Actual reported statistics over all SOS™ sites indicate an actual 20% identified reduction on a net basis. This is across both existing and replenishment Spares inventories

The benefit: a better (and overall, always lower) mix of spares. With holding costs in most organizations ranging between 20% and 35%, a reduction of 20% in total inventory value means direct impact to the bottom line each and every year, usually many millions of dollars.

There have been spectacular results

in large process industries.

If you are about to buy new spares for plant based on manufacturers' recommendations, you should use SOS™ to assess the true requirement. Remember, SOS™ does not rely on often inadequate, or incomplete history - it uses the valuable knowledge resident in your people.

SOS™ assessments have in many cases halved recommended spares lists ( for immediate cash savings).  Often, a SOS™ assessment recommends the holding of parts which are not even on the manufacturers' lists. This is because SOS™ is an optimizing process and is not a "slash and burn" tool.

SOS™ brings to account many more elements (into an assessment) to scientifically validate the level of a spares holding (or not) and removes much of the "gut feel" approach.

SOS™ satisfies, and responds to all disciplines from maintenance to materials management to finance.

Organizations are left with a clear "audit trail" of the basis for spares holdings decisions and a platform for continuous improvement.

"What if ?" scenarios can be explored using SOS™. Once an item's criticality has been assessed, alternative expected usage rates, lead times, repairability and other factors can be explored in order to establish whether or not a changed holding should be considered.

Commonality of parts, shelf lives and possibility of items going out of manufacture are also considered in the assessment process.

SOS™ can be easily linked to existing computerized maintenance management systems such as SAP, Maximo, Tabware, Indus etc for simplified import and export of data.