Opportunity Available in MRO Supply Chain, Study Says

Friday, May 9, 2014

A new study reveals the challenges in maintenance, repair and operating (MRO) supply chain management. Independent market research organization IMTS was commissioned by Philadelphia-based SDI Inc. (SDI) to interview executives from companies that spend over $5 million in annual MRO to gain a better understanding of the trends.

The inefficiencies, costs and barriers to improvement associated with MRO supply chain point to a great opportunity.

“From a commissioned national survey of over 100 manufacturing executives, we found that only 45 percent of companies felt they were efficient in managing MRO assets,” said Andy Cvitanov, SDI CEO. “Those respondents who aggressively and professionally manage MRO assets have a distinct market advantage in supporting and achieving their goals. Best in class companies spend little to no time searching for, acquiring and managing critical parts for production. Supporting this type of efficiency is at the heart of SDI’s offerings.”

Of the companies surveyed, 59 percent agreed that it is important or very important to optimize supply chain management. However, 40 percent of the participants claimed that management of the MRO supply chain is not a core competency and 55 percent stated that they are less than efficient in managing their MRO supply chains.

The cost of the MRO supply chain is fairly high, with more than 40 percent of participants spending greater than 10 percent of their maintenance budget and downtime on locating and acquiring MRO parts. Respondents further identified complexity of process as the biggest challenge to better practices in managing the MRO supply chain.