| Issue #178
Hi Friend,
One of the issues that I see in my work is that many companies still view spare parts management as a low level operational task. This results in spare parts inventory responsibilities being allocated to middle managers (and even supervisors) who themselves don’t see this task as core to their job. As a result, these companies:
- Waste millions of dollars on inventory that they don’t really need – in one case I know of personally it was hundreds of millions.
- Fail to get proper leverage from their IT investments – they spend up big on their ERP and then use excel as a work around.
- Throw ‘good money after bad’ through spending on ad-hoc ‘thought bubble’ problem solving – including software that is supposed to optimize their inventory but doesn’t (and in fact can’t).
- Let down their customers when they are unable to fulfil their product and service promise.
All of this is avoidable when senior managers and CFOs stop treating spare parts as a third-order issue that has little business impact and start seeing spare parts as a core function that helps deliver on business strategy and supports profit achievement.
To make this case, I am posting a series of articles that detail 7 things that every senior manager and CFO should know about spare parts management.
If you know a senior manager or CFO that would benefit from reading this, then please feel free to share.
Avoid Acronym Confusion Recently we released a new 'cheat sheet' to help you avoid 'acronym confusion. This is what happens when one person uses spare parts inventory management acronyms and abbreviations and another person either doesn’t know what is meant, or worse they think that it means something different. This leads to wasted time and expensive mistakes.
To avoid this you can download our 'cheat sheet' at the SparePartsKnowHow.com website. Details below.
Keep on improving!
Phillip Slater
Founder, SparePartsKnowHow.com
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