MRO stands for Maintenance, Repair and Operations and basically involves everything that is related to repairs and support of production operations. That’s classified in procurement as an indirect purchase, although it directly affects the daily routine of production.
It’s an important aspect of a company’s procurement because it assures that different departments keep functioning and operative. Even as an indirect purchase, MRO is a significant part of the budget.
In this article we will discuss more about MRO and how it’s fundamental to a company’s operation.
What composes MRO?
First of all, the products included in MRO are the ones that allow production and commercial activity. They aren’t incorporated in the final product though. In other words, they aren’t materials or items that are assembled in the product.
So, you can think of MRO as everything that provides the conditions of production and operation. It includes security items, such as helmets or protection gloves, also items that make machines work, as pumps or valves. Besides that, office items such as chairs and desks are also included.
As MRO contemplates a lot of different items, it can represent low value to high value purchases, and also different volumes according to the necessity of the company. As acronym suggests:
- Maintenance: necessary items to keep factory working;
- Repair: items that are used to fix broken machinery;
- Operation: day-to-day items that are important to keep operations;
Keep an organized MRO
It’s important to keep an organized MRO for numerous aspects. For instance, as they are regularly bought items, you need to keep track of orders and stock, so you can reduce down time and futile expenses. If you know how much stock you have, it’s easier to keep everything running.
So, it’s good to invest in an optimizing system for MRO items because it will have a quick return of investment and improve efficiency. As you won’t spend a lot of time dealing with MRO stocks, you can address more strategic issues. It also helps you have a general view of the inventory and free space in the warehouse.
Another way to improve performance is to regularly review equipment and work conditions. That way it will be possible to make preemptive repairs, avoiding bigger problems and operation breaks. But how can you make MRO managing more effective? That’s what we will talk about next.
Organizing MRO
So, now that you know why it’s important to keep it organized, let’s see some practical ways to do that.
A good first step is to define KPIs that can track performance and give insights on what needs to be better. It also provides the historical data of your evaluation, so you can see actions that worked and which didn’t.
Among possible KPIs are:
- Estimate costs;
- Supplier performances;
- Stock useful life.
- Increase in material storaged.
- Stockouts.
Besides the KPI’s, it is also important to listen to employees and address needs. Train your team to pay attention to MRO details and warn about possible malfunctions and problems.
In sum
A well-established and managed Maintenance, Repair and Operations can help businesses achieve good results in the long-term. It’s fundamental not to underestimate costs and how important indirect orders are to keep operations going. Although they usually are low-cost, as they are a constant aspect,you need to pay attention.
Finally, it can lead to benefits on productivity and performance, while it assures employees security and daily efficiency. Good practices are necessary to increase efficiency and profit for your company.
