Digital Spare Parts Management

Spare parts management offers massive optimization potential

Spare parts management has a clear target. It must ensure that the required parts are available at the right time, in the right quantity at the right place. If this fails, uninterrupted production with scheduled slots for replacement of spare parts cannot be guaranteed. And, in the event of unplanned machine malfunctions, service teams cannot grant that they are rectified within a reasonable time. The result is an expensive downtime.

To minimize this risk, machine operators must be able to keep sufficient spare parts in stock and provide them as needed. The challenge is to keep stocks as low as possible. Otherwise, too much capital would be committed in the warehouse. In addition, there would be a risk of certain parts becoming overaged.

Spare parts management for maintenance therefor has two opposing goals: optimal spare parts availability vs. minimal costs. This challenge can be addressed by digitalizing the use, acquisition, storage, and deployment of spare parts.

1. Calculate savings potential

The first step towards optimized spare parts management is to take a detailed look at the financial added value. The classic cost drivers of conventional spare parts management can be used for this purpose. These include:

  - Capital commitment
  - Warehousing costs
  - Deposition costs
  - Downtime costs due to machine stops
  - Acquisition costs
  - Costs for audits
  - Stock losses (overstocking due to poor obsolescence management)

2. Record the current state

In this step, all physically and digitally available information concerning procurement, warehousing and spare parts provision is collected. In addition to existing IT systems (e.g. ERP), information sources such as binders, excel spreadsheets and employees (knowledge carriers) must also be considered. In addition, if possible, existing digital management systems (RFID, NFC, QR codes, etc.) must be included.

3. Define the goals of spare parts management

What is important now is to precisely define the strategic and operational goals of future spare parts management. Strategic goals can be, for example, optimization of inventories, higher plant availability, better obsolescence management or more effective planning of service. From an operational perspective, however, topics such as the simplification of material procurement, ordering, spare part identification and provisioning are in focus.

4. Select logistical strategies

In this phase, the operational procurement, warehousing and allocation strategy is selected. In procurement, it must be decided whether it should be demand-based, deadline-based or inventory-based. Also possible are deterministic, forecast-based and self-optimizing procedures. Furthermore, the layout of the storage locations (centralized, decentralized, directly in production, external) must be planned. The same applies to the provision of spare parts for the maintenance teams (program-, on-call-, demand- or order-related).

Once the spare parts management strategy has been defined, it should be aligned with the adjacent sub-strategies. This concerns the strategies of maintenance, manufacturing, material planning and logistics. In addition, the impact on existing organizational structures must be questioned. In any case, maintenance and purchasing are jointly responsible for spare parts acquisition.

5. Select and implement software

At this point a spare parts management software can be selected - based on the defined goals and strategies. Ideally, the software is flexible enough to be adapted to the company's individual processes and tasks. Furthermore, it should have an open architecture so that it can be easily connected with additional systems such as ERP, EDI, QM and spare part identification. Also, the mobile availability of the software plays a role.

In addition, the possible use of machine data from other solutions is important. By integrating machine data into spare parts management, considerable simplifications and improvements in maintenance processes can be achieved. In the best case, a machine can notify its required spare parts itself and trigger automated follow-up processes in procurement. In the simplest case, the machine master data, which correlates with the parts information, is automatically transferred and updated.

6. Launch pilot project

The selected maintenance system can now be set up and configured. This includes measures such as the creation of spare parts master data, purchasing data, warehouse data, pictures, drawings, CNC programs, target stocks, supplier data and some more. In the best case, this data is integrated via already existing apps or software tools. Duplicate maintenance, regardless of the data, should be avoided at all costs.

Of course, the data must also be reflected in the physical handling. For example, it is necessary to clearly label the storage locations and parts in the pilot warehouse.

7. Connecting spare parts management

Digital spare parts management should be connected to the existing systes or with other applications already in the pilot phase. The requirement that “everything should be connected to everything else” often ends in a “allrounder-solution” – those are often very complex applications that never precisely fit, are inflexible and, as a result, are very cost intensive. Different use cases simply require different applications. In a heterogeneous production environment, no single application can do everything. For shopfloor applications, this means that the apps must be able to exchange and (permanently) synchronize data with each other. Nowadays connected use cases are the rule rather than the exception.

8. Start live operation

If the pilot is successful, the optimized spare parts management can go live. From this point on, the digital solutions are responsible for minimizing the cost drivers mentioned at the beginning. To ensure that this succeeds, continuous improvement should be checked.