2.9 MAINTENANCE-REPAIRS AND SPARE PARTS (STORES) MANAGEMENT
By Aleksandar
Pudar
Technical Superintendent
and Planned Maintenance Supervisor Reederei Nord BV
Co-founder of "Out of Box
Maritime Thinker Blog" and founder of Narenta Gestio Consilium Group
Effective
maintenance repair and operations (MRO) storeroom management is crucial for
vessel owners and operators. It is essential to know the status of MRO
inventory and provide quality parts to engineers for scheduled repair work;
this requires identifying the strengths and weaknesses of current processes and
establishing best practices for target storeroom operation.
To
achieve this, baseline information for MRO inventory management can be
established, and key performance indicators selected to track storeroom
operation. Since the storeroom is not independent, partnerships must be
established between the technical department, onboard engineers, purchasers,
and supervisors in each area of maintenance and operations. Responsibility and
accountability must be assigned to ensure successful departmental partnerships
and quick resolution of identified problems.
Moreover,
training crew on effective MRO storeroom management practices is essential;
this includes identifying potential problems, defining best practices, and
assigning responsibility and accountability. Effective storeroom management can
lead to positive changes, increased productivity, and reduced downtime.
2.9.1 OBJECTIVES OF INVENTORY
The
main objectives of inventory management in the context of vessel and vessel
management include the following:
•
Reducing cycle time by improving lead,
transportation, repair, return, and the kitting and delivery process.
•
Reducing inventory and associated
carrying costs, as well as expedited freight costs, to improve profitability.
•
Increasing inventory accuracy ensures
that the right parts are available at the right time and place.
2.9.2 TYPES OF INVENTORY
In
the context of the vessel, the inventory typically includes the following
categories:
•
MRO
supplies - parts supporting maintenance and
operations, and operating supplies supporting maintenance and operations.
•
Hardware - small tools, fasteners, free stock,
vendor-managed inventories, and consumables.
•
Office
and facility supplies - any
office supplies and equipment, all janitorial and sanitary supplies.
Effective
MRO materials management ensures the vessel remains operational and efficient.
While focusing on the last three inventory categories, MRO materials management
is also linked to control activities and management processes. It is essential
to establish effective inventory management practices to support the
maintenance and repair of the vessel, minimise downtime, reduce costs, and
improve overall operational performance.
2.9.3 BEST PRACTICES INVENTORY MANAGEMENT
1.
Implementing
and sustaining lay-up maintenance for spare parts in storage. A lay-up program
ensures that all rotating stock is maintained under a preventive maintenance
(PM) program, and other items like "O" rings, belts, gaskets, and so
on, that are affected by dust, dirt, and temperature or humidity changes,
receive special attention for their storage needs; this ensures that the spare
parts are kept in good condition and are ready for use when needed.
2.
Vendor/Supplier-managed
inventories that are managed effectively and a good partnership between the
vendor/supplier and the vessel management organisation can be very beneficial;
this helps ensure that the vessel has the necessary spare parts on hand when
needed, without excess inventory.
3.
Cycle
counting should be part of a daily routine for the storeroom. The ABC
classification or counting by selected areas is an acceptable method for
managing an inventory cycle-counting program; this helps ensure that the
inventory is accurate and up-to-date and reduces the risk of stockouts or
overstocking.
4.
Identifying
obsolete parts and removing them based on a monthly budget is the best practice
to keep dead inventory at an acceptable level; this ensures that the inventory
is optimised and reduces the risk of holding excess inventory that is no longer
needed.
5.
Effective
salvage of obsolete and scrapped materials helps to minimise waste and ensures
that any usable materials are put to good use.
6.
Controls
over the repair and return process are essential for the storeroom to maintain;
this ensures that any damaged or faulty spare parts are correctly identified,
repaired, or returned as needed.
7.
Storeroom
layouts need to stress efficiency and effectiveness; this ensures that the
spare parts are stored in a way that is easy to access and use, reducing the
time and effort needed to locate and retrieve them.
8.
Manning
levels should be optimised and inventory levels controlled; this ensures that
the storeroom is adequately staffed and the inventory is managed correctly to
meet the vessel's needs.
9.
Housekeeping
practices meet good seamanship standards; this ensures the storeroom is clean,
organised, and free from clutter, making it easier to locate and access spare
parts.
10. A defined receiving process is in place; this
ensures that any incoming spare parts are properly inspected, identified, and
stored, reducing the risk of errors or delays in the inventory management
process.
11. Stocks in stores meet the FIFO (first in, first
out) guidelines for shelf administration; this ensures that the oldest
inventory is used first, reducing the risk of obsolete or expired spare parts.
12. The workflow process for kitting is mapped and put
in place for all planned work; this ensures that the spare parts are correctly
identified, grouped, and prepared for use in maintenance and repair work.
13. All storerooms are closed and physically secured;
this ensures that the spare parts are kept safe and secure, reducing the risk
of loss, theft, or damage.
14. A dashboard has been established to measure key
performance indicators; this provides visibility into the inventory management
process, helping to identify areas for improvement and ensuring that the
storeroom is operating efficiently and effectively.
15. There is an approved supplier list; this ensures
that any spare parts purchased meet the required quality standards and are
compatible with the tanker vessel's equipment.
16. There is a defined locator system for inventory and
tools; this ensures that the spare parts and tools are correctly identified,
located, and stored, reducing the risk of errors or delays in the inventory
management process.
17. All processes are mapped and analysed to streamline
the workflow process. Step definitions, training plans, and job descriptions
have been developed, ensuring the inventory management process.
2.9.4 BARRIERS TO BEST PRACTICE INVENTORY
MANAGEMENT
1.
Not
utilising the ABC inventory management classification for MRO inventory.
2.
Lack of
standard operating procedures for storeroom operation and undefined workflows.
3.
Failure
to measure key performance indicators (KPIs) to monitor inventory accuracy,
supplier performance, emergency orders, freight costs, overtime, inventory
turns, carrying costs, and quality.
4.
Lack of
coordination, communication, and cooperation between departments regarding MRO
inventory management.
5.
Obsolete
materials are not identified and removed from the inventory and the
computer-based maintenance management system (CMMS) in a timely manner.
6.
No
established purchasing practices, such as economic order quantity (EOQ),
lot-for-lot (L4L), and promoting vendor-managed inventory (VMI).
7.
Lack of
accurate equipment bill of materials (BOM) for MRO inventory management.
8.
The
maintenance department does not utilise a work order system.
9.
Kitting
and delivery of planned work are not practised effectively and efficiently.
10. Critical assets and parts are not always identified
and available in the storeroom inventory.
11. Hidden storerooms (lockers, tool boxes, and
locations not identified in the CMMS) with inventory "not on the
books."
12. No rating system is in place for vendors or
suppliers to ensure effective and efficient MRO inventory management.
2.9.5 INVENTORY CONTROL
Poor
use of the vessel's working assets can be minimised through improved inventory
turn rate, cost control, efficient purchasing practices, inventory
cycle-counting, recorded issuances against actual equipment and work orders,
secured access, and crew coverage.
Minimising
stocking or squirrelling of parts can go a long way to ensure the best use of
inventory dollars. It has always been difficult to forecast what inventory
needs to be stocked when it will need, and in what quantity. The goal is to
stock the lowest inventory level possible but has the parts readily available
when needed. Forecasting for many is just a wild guess, but the best-in-class
tanker management organisations are reviewing past inventory records to
determine item activity, min/max levels, supplier contracts, and options for
vendor-managed inventory. Many software packages available can significantly
assist in forecasting inventory needs. Improving inventory management practices
can convert storeroom investment from a liability to a highly valued asset.
2.9.6 REPLACEMENT ASSET VALUE
The
replacement asset value (RAV) is the euro amount it would cost to replace the
vessel, vessel machinery and equipment assets in case of a disaster. Insurance
companies value vessels and equipment for replacement, much like the average
person secures insurance for their home and automobiles. Therefore, the
replacement value of the vessel and its equipment can be used as a gauge to
determine the dollar amount of MRO inventory needed to maintain in the
storeroom. With this in mind, the best-practice inventory value for the average
MRO storeroom on a tanker vessel is estimated to be 0.50 to 0.75 per cent of
the RAV. The RAV percentage may vary according to the type of tanker vessel and
is usually determined by a corporate directive or expectation communicated to
the vessel manager.
2.9.8 RISK MANAGEMENT
The
risk associated with not stocking certain items in the MRO inventory is a
decision that vessels and management organisations should make. Having every
part for every piece of equipment on board is not practical, as it would
significantly increase inventory costs. A parts standardisation program should
be used to stock the most efficient MRO inventory, and the availability of
parts from suppliers should be assessed. For critical equipment parts, it is
not recommended to use non-stock or offsite supplier stocking. Even if the
decision is made to stock parts on board, the job is incomplete. A lay-up and
preventive maintenance program should also be in place to reduce the risk of
parts not performing as expected when put into service.
A
failure modes and effects analysis (FMEA) should be conducted to evaluate the
probability of failure. It is important to have a history of equipment repair
and some idea of the life expectancy of the parts being assessed. Without this
information, decisions on whether to stock or not become subjective. The FMEA
should consider factors such as the possibility of the supplier going out of
business, engineering changes that could make the part more reliable,
technological advances, the equipment's maintainability, the possibility of a
labour strike at the supplier site, and the probability of a natural disaster.
The list of factors to consider in an FMEA is extensive, and careful evaluation
of each factor is essential to determine the optimal MRO inventory stock or
non-stock policy.
2.9.9 LOSS ELIMINATION
Inventory
losses are also a concern for tanker vessel tanker management organisations, as
they can lead to delays, increased costs, and safety hazards. These losses can
occur due to theft, damage, incorrect issuance, or improper storage of
materials. One effective way to prevent inventory losses is by implementing a
proper inventory management system that includes proper documentation, quality
control checks, and monitoring of shelf life and warranty claims. A preventive
maintenance program can also be established to ensure that all items in storage
are maintained under appropriate conditions. It is also essential to enforce
security policies in the storeroom, require work orders when issuing materials,
and properly handle hazardous materials. By taking these steps, tanker vessel
tanker management organisations can minimise inventory losses and ensure their
operations run efficiently and safely.
Common
reasons for inventory losses are
•
Wrong
part received
•
Items
received damaged, no claim processed
•
Damage
to items while in inventory
·
Located
in the wrong location
•
Move to
a new location, and new location not entered
•
Wrong
part issued
•
Damage
from exposure to the environment
Loss
prevention can be done by
•
Shipping
documents on all outbound materials
•
Implementing
quality control checks in receiving
•
Monitoring
shelf life of parts in storage
•
PM
activities for parts in storage
•
Proper
packaging
•
Accurate
warranty claims
•
Removing
obsolete materials
•
Enforcing
the security policy in the storeroom
•
Requiring
a work order when issuing materials from stores
•
Proper
handling and storage of hazardous materials
2.9.10 INVENTORY CRITICALITY
In
the vessel management organisation, it is crucial to determine the criticality
of MRO inventory to ensure the availability of the right parts at the right
time. Maintenance and engineering departments play a crucial role in
identifying the criticality of MRO inventory and prioritising each item; this
can be achieved through the equipment bill of materials, which lists the parts
evaluated by the reliability engineering team to determine their hierarchy and
criticality for each identified asset group. The prioritised MRO inventory is
managed carefully, with a policy addressing environmental conditions, humidity,
dust, dirt, and exposure to high-traffic areas.
Accurate
equipment BOMs are essential to the planning and scheduling department to
prepare a work schedule for maintenance technicians. The accuracy of the BOM
ensures that critical parts are identified, and it becomes the responsibility
of the storeroom to ensure that these parts are in inventory 100 per cent of
the time. Any modifications or inventory added must be entered into the CMMS
using the approved standard part description and the criticality priority
assigned for inventory management.
Certain
types of MRO inventory require special attention and facilities to protect
their integrity. Electronic drive boards and drive units are examples of
inventory that can be damaged when exposed to temperature, humidity, dust, and
dirt. The MRO bearing inventory is another item that needs to be correctly
stored to prevent storage damage that will cause the bearing to fail
prematurely when placed in service. Again, the supplier is a good resource for
proper guidelines to follow to ensure inventory is stored correctly and not
damaged during storage.
Handling
hazardous materials is a significant concern for the tanker vessel management
organisation. Training storeroom personnel to handle hazardous materials and
react quickly to accidental spills is essential to prevent environmental or
personal injury. Hazardous materials must have special storage accommodations
like flame-proof cabinets, segregation from regular inventory or secure
facilities built to house only that classification of hazardous material.
Training to understand the materials safety data sheets (MSDS) and use the
personal protective equipment required to handle hazardous material safely must
be part of a safety awareness program for the storeroom.
2.9.11 STOCKING LEVELS
In
the context of a vessel management organisation, it is crucial to have
materials readily available to ensure that the vessel operates at total
capacity, maximising production output while minimising downtime. The MRO
inventory must be managed effectively to ensure that critical and insurance
spares are available 100% of the time to prevent production losses due to
equipment failure. The reliability engineering team plays a vital role in
determining the criticality of MRO inventory and prioritising them accordingly.
In addition, it is essential to have an accurate equipment bill of materials to
support effective planning and scheduling of maintenance activities.
Supplier
accountability is another critical aspect of inventory management. Suppliers
must deliver the materials on or before the due date indicated by the planner,
and if there are any delays, they must communicate with the purchasing and
storeroom departments to adjust planned jobs accordingly. Effective
communication between departments and suppliers is crucial to avoid surprises
and maintain service levels.
Expected
service levels of MRO parts must be defined to manage inventory levels
effectively. For example, critical or insurance spares must be available 100
per cent of the time, while components to insurance spares require 98 per cent
availability. In addition, standard replacement parts, hardware items, small
tools, and general supplies must have 95 per cent, 90 per cent, 90 per cent,
and 90 per cent availability, respectively. Effective management of MRO
inventory ensures that the tanker vessel operates at total capacity and that
production losses due to equipment failure are minimised.
2.9.12 CARRYING COST
Carrying
costs are a significant factor to consider when managing a plant or
organisation's MRO inventory. These costs are calculated by applying an annual
percentage to the total value of MRO inventory per period and can be prorated
according to the specific period being used. However, it is essential to note
that the carrying cost calculation should not be oversimplified, as this can
result in an inaccurate picture of the actual cost of maintaining the
inventory.
Excessive
obsolete or slow-moving inventory can directly impact the carrying cost of MRO
inventory. While it can be difficult to let go of
obsolete items, reducing these costs can result in significant savings for the
organisation.
While
carrying costs are considered a necessary evil and a cost of doing business,
best-practice inventory management and following defined workflow processes can
help to control these costs. It is important to remember that cost-cutting
efforts focused solely on reducing headcount may provide short-term gains but
can ultimately result in serious tactical business mistakes. Therefore,
effective management of the MRO inventory is essential for overall business
success.
2.8.12.1
ELEMENTS OF MRO CARRYING COSTS
•
Cost of
money: The interest cost associated with
holding inventory.
•
Property
taxes: Taxes on the property where the
inventory is stored. (warehouse before delivering on board)
•
Liability/property
insurance:
Insurance costs to protect the inventory from damage, loss, or theft.
•
Obsolete
inventory: The cost of maintaining no longer
needed or useful inventory.
•
Shrinkage
and deterioration: The
cost of lost or damaged inventory due to shrinkage or deterioration.
•
Scrap: The cost of disposing of unusable inventory.
•
Damage: The cost of repairing or replacing damaged
inventory.
•
Theft: The cost of inventory lost to theft or pilferage.
•
Facility
rent: The cost of renting space to store
inventory.
•
Utilities: The storage space's electricity, heating, and
cooling costs.
•
Weight: The weight of spares reduces the vessel's payable
weight and earnings for some time.
•
Storeroom
labour cost: The
cost of labour to manage and maintain the inventory. (warehouse
before delivering on board)
•
Storeroom
security: The cost of security measures to
protect the inventory from theft or damage. (warehouse before delivering on
board)
2.9.12.2
CARRYING COST CALCULATION
Carrying cost = (carrying cost %) × (total
inventory value)
2.9.13 STOREROOM MANAGEMENT
2.9.13.1
ROLE OF A STOREROOM SUPERVISOR (2nd
Engineer, Chief Engineer, Chief Officer)
The
storeroom supervisor on a vessel and within the vessel management organisation
plays a critical role in supporting the maintenance department. The storeroom
is where the ship's engineers and crew will come, expecting to find the parts
they need to repair operational equipment. The storeroom supervisor (2nd
Engineer, Chief Engineer, Chief Officer) is responsible for running a service
within an organisation and is ultimately responsible for providing the correct
items in good condition, of the right quantity, and good quality.
Much
like an auto mechanic who goes into a parts store, if they are given the wrong
part, it is dirty and corroded, and with parts robbed off, will that auto
mechanic return to that part store or find another supplier? The same is true
for the ship's engineers and crew; their only vendor is the storeroom
supervisor (2nd Engineer, Chief Engineer, Chief Officer), and the maintenance
department is the only customer. Suppose the deck department gets upset with
the storeroom(2nd Engineer, Chief Engineer). In that case, it can lead to a
highly reactive situation that will drive the repair cost through the roof and
directly affect the ship's profitability.
The
following are some key responsibilities of the storeroom supervisor (2nd
Engineer, Chief Engineer, Chief Officer)
on board the vessel and within the vessel management organisation:
•
Maintain
a clean and orderly storeroom to ensure easy accessibility of parts
•
Plan
the storeroom layout, taking into consideration the available space on board,
for efficient order picking and inventory care.
•
Organise
and manage staffing levels to ensure adequate support for maintenance, ensuring
that the right personnel are employed to manage the inventory
•
Work
closely with the planning/scheduling department to ensure the right parts are
available for planned maintenance activities.
•
Provide
inventory reporting to purchasing to ensure that the right parts are ordered
and available when needed.
•
Monitor
min/max levels and order point information to ensure that the storeroom has
adequate levels of inventory to support maintenance activities.
•
Manage
inventories by ABC classification to ensure critical parts are available when
needed.
•
Use
best practice inventory management practices to optimise the inventory levels
on board and reduce carrying costs.
•
Coordinate
activities with other disciplines (purchasing, accounting, engineering,
operations, management) to ensure high support for maintenance activities.
•
Provide
monthly key performance indicators (KPI) reports to the maintenance manager for
effective decision-making and continuous improvement.
•
Coordinate
special parts orders with maintenance to ensure that the right parts are
ordered and delivered on time.
•
Provide
reports to management such as inventory valuation reports, negative inventory
reports, cycle count variances, scrap, and obsolescence.
•
Attend
maintenance and plan meetings to provide updates on inventory status and
upcoming parts deliveries.
•
Become
familiar with ship equipment and operational processes to ensure the correct
parts are available when needed.
•
Maintain
open lines of communication with the maintenance department to ensure that
their needs are met, and any issues are resolved on time.
Overall,
the storeroom supervisor is critical in ensuring that the maintenance
department is well-supported and that the correct parts are available when
needed. In addition, by managing the inventory effectively, vessel management
can reduce carrying costs, optimise inventory levels, and improve the ship's
overall equipment effectiveness (OEE).
2.9.13.2
FUNCTIONS OF A STOREROOM
•
Receive goods
•
Store inventory correctly
•
Issue items from inventory
•
Utilise the kitting process for planned work
•
Respond to emergency breakdowns
•
Maximise effective use of resources
•
Perform PM as required
•
The single point for shipments when landing and
receiving parts
2.9.13.3
WHO SHOULD THE STOREROOM REPORT TO?
The
organisational structure of every vessel management organisation is different,
and who has responsibility for each specific function will also vary. Whom the
storeroom (warehouse) reports to is a topic of debate, and there are strong
arguments for ownership and management in each case. The MRO storeroom is a
facility that houses millions of dollars in spare parts with lesser amounts of
operating supplies and acts as a funnel for all purchased items received into
the organisation. The storeroom ( warehouse) is responsible for distributing
spare parts and supplies upon request to the vessel's job site as a kit or
assembly to support maintenance. In the case of vessel and vessel management,
the storeroom does not take orders for its replacement inventory; the crew does
that. Crew ensures the items are correctly stored to protect them from handling
or environmental damage. Storeroom employees perform job tasks like
accountants, counting the inventory, monitoring the inventory turns, and
accounting for each dollar of inventory on a monthly basis.
Looking
at the activities and function of the storeroom on these factors, it would be a
good argument that the purchasing department or finance should control the
purse strings of such a significant investment.
Who
would know better how much of each item to stock and the best investment of
parts to produce the highest return? In the case of the storeroom, it is not so
much about return on the investment; it is more about having the right part
ready to go when needed. Kitting and scheduling maintenance work are two
activities that require seamless communication and cooperation every step of
the way. Not having the parts available when needed or finding out have a part
that does not meet the engineering specifications will discount any cost
savings and cost more in operational downtime and rework.
While
all departments within the vessel management organisation have some ownership
in the storeroom, the main focus is to supply maintenance with the parts and
materials to perform their work efficiently. Finance and purchasing have a
definite interest in the dollars invested in the MRO inventory but lack the
expertise to make the necessary decisions to support maintenance and
operational excellence. On the other hand, engineering and the technical
department have the expertise and are ultimately on the hook to ensure
operations will produce at maximum capacity. Undoubtedly, it is essential to
have the storeroom report to the Technical department/manager.
2.9.13.4
HOUSEKEEPING AND 5S
A
vessel management organisation's storeroom excellence is crucial for efficient
operations and crew morale. The storeroom is a critical facility that houses
valuable spare parts and supplies, making it essential to keep it clean and
orderly. In addition, a well-maintained storeroom ensures that the maintenance
crew can promptly access the parts they need to repair operational equipment.
Implementing
a 5S program can be an effective way to start maintaining a world-class
storeroom operation. The five-step process includes sorting clutter into
categories, systemising the workplace, daily maintenance of the work area, standardising
the methods learned, and expanding the 5S method throughout the facility.
In
a tanker vessel management organisation, the first two steps of the 5S program
require a team effort to decide what parts are necessary and what can be
disposed of. After that, the daily maintenance of the work area becomes
routine, and behaviour change occurs. Ensuring the storeroom is tour-ready maintains
crew morale and prevents unnecessary repair delays.
While
every department within the vessel management organisation plays a role in the
storeroom, the technical/engineering department has the expertise to manage it
effectively. In addition, the maintenance department needs to ensure the
storeroom is clean and well-organised to provide the right parts and materials
efficiently to support vessel operations. In summary, maintaining a clean and
organised storeroom is crucial to the efficient operations of a vessel
management organisation.
2.9.13.5
KEY PERFORMANCE INDICATORS
Key
performance indicators (KPIs) are essential in measuring the effectiveness and
efficiency of the storeroom operation in a vessel management organisation.
These KPIs provide a benchmark of the current performance and help identify
areas for improvement. By analysing trends through charts and graphs, KPIs can
predict the future performance of the storeroom unless changes are made to
improve the current situation. It is essential to communicate KPIs to employees
to ensure they understand their job expectations and how they can contribute to
the success of the storeroom. By using KPIs as a tool for managing the
storeroom, the organisation can facilitate change management programs
effectively. In summary, KPIs are vital in managing and improving the storeroom
operation and should be used to monitor performance continually.
2.9.13.6
MATERIAL CARE AND STORAGE
The
environment of the vessel's storeroom should be sensitive to the type of parts
stored. Sensitive electronic equipment and computer boards must be stored in a
controlled temperature and humidity atmosphere. Whenever parts are unsuitable
for installation in a piece of equipment, they must be removed from the
inventory. Racking is also an essential part of inventory storage. Selecting
the correct type of rack application for the tanker vessel is essential to
proper inventory storage. Rack loading should never exceed the rated capacity,
and the capacity rating for each rack must be indicated to prevent overloading.
If the storeroom has multiple floors or the floor has a rating capacity, it may
be necessary to calculate total rack capacity and load restrictions to prevent
overloading the floor capacity. Many storerooms use standard pallet-size
racking and purchase pallets to store MRO inventory, which can remain in or be
returned to the storeroom. Lighting is also essential in a well-organised
storeroom, and some storerooms use light-coloured floor epoxy paint to reflect
available light and improve visibility.
All
inventories require special care while stored in the tanker vessel's storeroom.
Bearings are sensitive to vibration, dirt, humidity, and being dropped.
Vibration-dampening cabinets or racking in a climate-controlled environment is
a good idea for bearings that will be stored extensively. Electric motors,
gearboxes, and other rotating stock should be under a PM program that rotates
the motor shaft or gearbox shaft 450 degrees from the original position. If the
motor or gearbox is identified as a critical item, the PM should be conducted
every 45 to 60 days. Heating blankets and low-voltage current applied to
critical motors and transformers also decrease the possibility of moisture
causing damage to windings and internal electrical components.
The
vessel's storeroom may have a central storeroom with several smaller satellite
stores throughout the vessel. Satellite stores allow the crew to have parts and
supplies closer to their work areas, but this should not be a convenience to
compensate for a reactive maintenance program. If the decision to have
satellite stores is accepted, the main storeroom must control all inventory
entering the satellite stores, and this inventory is subject to the same
guidelines as the main storeroom when it comes to PMs, cycle counting,
housekeeping, and inventory levels.
Sometimes
the storeroom may have developed poor business practices, and the tanker vessel
organisation needs to revise the current practices. The first step in
organising or revising a storeroom is to develop a plan of action. The plan
should include an organisation chart, a matrix of resource allocation, and an
analysis of the type of material stored, the type of storage required, and the
inventory levels needed to support maintenance. The organisation chart
describes the needed personnel positions, including the reporting structure
required to manage the storeroom. An allocation of resources matrix determines
the workforce required to perform the work and promptly provide the expected
service. The matrix may include slots from some or all of these positions:
engineering, purchasing, planning and scheduling, storeroom management,
storeroom personnel, shop repair technician, quality control and assurance,
materials management, and possibly a representative from operations. The
vessel's maintenance storeroom will interact with all of these areas at some
point, and the expected areas of participation must be communicated so
employees understand their role in the change process. Materials stored need to
be reviewed for the following considerations:
•
Environmental
exposure
•
High-dollar
critical items
•
Security
requirements
•
Bulk
storage
•
Operating
supplies, consumables
•
Speciality
tools
•
Electric
motors, gearboxes (PM program)
•
Packaging
(replace broken packages or aged packages)
•
VMI and
consignment inventory
Managing
inventory on a vessel is crucial to the successful operation and maintenance of
the ship. Once the inventory is received, it must be stored correctly and
efficiently for easy access when needed. The type of storage racks and cabinets
used should be carefully planned and organised to ensure that items are easily
retrievable. Inventory must be assigned a specific location using a locator
system in the computer system that identifies each part with all empty bins
reported and marked in the system.
Establishing
supplier partnerships and certified suppliers is important to support the
maintenance effort. The purchasing and storeroom managers should communicate
lead times from suppliers and the availability of parts to the maintenance
crews. By planning the organisational needs of the storeroom regarding
materials and labour, the daily operation will be more predictable and
efficient from day to day.
The
goal of the storeroom is to provide outstanding support and service to the
organisation to ensure that equipment is repaired, providing the lowest mean
time to repair possible with the right parts, quality of parts, and quantity.
The best practice storeroom inventory value in the tanker vessel industry is
usually 0.5 to 0.75 per cent of the replacement asset value of the ship
equipment.
If
overflow storage locations are required, a specific location must be designated
and entered into the computerised maintenance management system (CMMS).
Barcoding is a great tool for tracking inventory movement and will help
employees quickly move the inventory. Using a sound min/max program
administration, planned purchases, and detailed forecasts, stock outages can be
minimised, and a solid basis for parts management can be established.
2.9.13.7
TYPES OF LOCATOR SYSTEMS
In
the context of the vessel tanker management organisation, efficient inventory
management is crucial to ensure that spare parts and supplies are available to
keep the vessel running smoothly. Several inventory storage and management
methods can be applied to this organisation.
Fixed
locations for inventory are no longer considered efficient due to the
fluctuation in inventory size and usage, which reduces the amount of space
needed. Random locations are the most efficient method of inventory storage and
are used more frequently due to bar coding and radio frequency identification
(RFID) locators. Floating slots work best for capital project inventory
management or items not in storage for over a few months. A logical address
system is the most efficient method of grouping inventory by commodity.
Employees easily understand this system and can reduce search time if the MRO
inventory is not catalogued in a CMMS.
In
the kitting area of the storeroom, locations should be assigned so that kits
can be located quickly and the status of each kit can be determined at a
glance. Each planner will have an assigned set of racks where all kits they
have in progress will be located.
The
CMMS should be able to identify and report all empty bin locations available
throughout the warehouse. This report allows store employees to plan the stock
location work for inventory stock received daily. Cabinets can be tricky to
determine how much space have available. A good method to ensure space
utilisation is to use magnetic buttons to indicate open slots in cabinets and
closed containers. Commodity grouping of inventory is a very good method to
keep the unused space problem in cabinets to a minimum.
To
reduce waste and promote cost savings, returnable plastic containers can be
used instead of cardboard boxes that must be disposed of by the customer.
Returnable pallets from the supplier can also be used to reduce costs. Totes
for oils and chemicals are reusable bulk containers and are returned to the
supplier, eliminating the need for metal or plastic barrels.
Dust
and dirt can cause damage to unprotected inventory. They should be stored in
vacuum-sealed packages or plastic containers to prevent damage to rubber
products. Free-issue inventory, such as nuts, washers, and bolts, can be
managed using a vendor-managed inventory agreement and a two-bin Kanban system.
The supplier checks the inventory periodically and fills the bins as required,
promoting a first-in, first-out inventory management system.
Efficient
inventory management is critical to ensure that spare parts and supplies are
available to keep the tanker vessel running smoothly. By implementing the above
inventory storage and management methods, the organisation can minimise waste,
reduce costs, and improve overall efficiency.
2.9.13.8
BARCODING
Barcoding
technology offers over 40 symbolisms in today's industry, providing customers
various options. Two main types of bar codes are available, one-dimensional
(1D) and two-dimensional (2D) or QR codes, which stand for Quick Response code.
The 1D is the most common and cost-effective type suitable for most MRO
inventory needs. On the other hand, the 2D system is more advanced and used by
large parcel carriers.
Bar
code scanners read bar code labels and transmit data in real-time to the CMMS
system using radio frequency (RF) communication. Alternatively, some scanners
store the data internally for later download into the CMMS. The market offers
two primary technologies for barcode scanners: the laser scanner and the
charged coupled devices (CCD). Laser scanners can scan bar codes from over 20
ft away, making them the preferred choice for most storeroom employees. On the
other hand, CCD scanners are better suited for scanning bar codes on office or
shop floor documents.
Hand-held
scanners can read bar codes in either direction, making it easy to scan items
even when the unit is upside down. Laser scanners can also be mounted onto
vehicles like lift trucks to scan location and product labels without the
driver leaving the seat. Implementing a bar code program in the MRO storeroom
can significantly increase employee productivity. However, a drawback of the
bar code system is that employees must scan items to their location, scan
inventory moved to another location, and record all issues and receipts
accurately for the system to maintain an accurate inventory. Therefore, the
system's success depends on how well the employees operate it.
2.9.13.9
WHY IS BAR CODING ATTRACTIVE IN MRO INVENTORY CONTROL?
Implementing
a bar code system with radio frequency transmitters allows for real-time
inventory management and accurate recording of transactions. As soon as
inventory is received, it is entered into the CMMS inventory management system,
and when issued, it is immediately removed from inventory. This system
simplifies tracking and recording of repair histories for operational
equipment, and employee training is fast and easy. In addition, using scanners
to record data in place of paperwork eliminates errors in transposing numbers
or forgetting to record transactions. Furthermore, a bar code system can
increase productivity and improve MRO storerooms' efficiency.
When
implementing a bar code system, it is important to communicate the benefits to
employees, involve them in the planning process, set realistic schedules, and
allow ample time for training. Mistakes during implementation can be costly and
may not provide the expected benefits. A bar code system is a significant
capital expenditure, but the main benefit is real-time control of the MRO
inventory, which can lead to a reduced total inventory investment and a reduced
paperwork and clerical workforce.
While
RFID technology has many applications, it may not be cost-effective for most
organisations now. For example, using a bar code system for receiving, issuing,
and cycle counting inventory can outweigh the cost of implementing an RFID
system. However, as technology advances and costs decrease, RFID may become a
more viable option for MRO inventory management.
2.9.13.10
MACHINE LEARNING RECOGNITION SOFTWARE IN MRO INVENTORY CONTROL
Visual machine learning recognition
software can significantly affect inventory management by automating inventory
tracking and reducing manual labour. Cameras and sensors can be installed in
the warehouse or storeroom to monitor inventory levels and movement using
visual machine-learning algorithms,
The visual machine learning recognition
software can recognise different items by their unique features, such as shape,
colour, and size. Then, as items move in and out of the storeroom, the software
can track them in real time, providing accurate information about inventory
levels.
This technology can also identify when
inventory runs low, alerting inventory managers to restock certain items; this
can help reduce inventory carrying costs by ensuring that only the necessary
inventory is kept on hand.
Visual machine learning recognition
software can also help with quality control by identifying damaged or defective
items; this can help prevent the distribution of faulty products and reduce the
risk of product recalls.
Furthermore, this technology can
improve accuracy and efficiency in picking and shipping orders. Using visual
machine learning recognition software, warehouses and storerooms can automate
the order-picking process, reducing errors and improving order fulfilment
times.
2.9.13.11
WHY USE MACHINE LEARNING RECOGNITION SOFTWARE IN MRO INVENTORY CONTROL?
There
are several reasons why machine learning recognition software can be beneficial
for MRO inventory control:
•
Improved
accuracy: Using machine learning
algorithms, the software can accurately identify and track inventory items; this
helps to reduce the likelihood of human error, such as mislabeling or
miscounting, which can lead to inventory discrepancies and supply chain
disruptions.
•
Increased
efficiency: Machine learning recognition software can process large amounts of
data quickly and accurately; this helps to streamline inventory management
processes, such as cycle counting and frees up staff to focus on more
value-added activities.
•
Real-time
tracking: Machine learning recognition software can track inventory in real-time,
allowing for more accurate demand planning and reducing the likelihood of
stockouts; this helps ensure that the right inventory is available when needed,
reducing downtime and improving overall equipment effectiveness (OEE).
•
Predictive
maintenance: Machine learning recognition software can monitor equipment
performance and predict when maintenance is needed. The software can identify
patterns and anomalies that may indicate a problem by analysing data from
sensors and other sources; this helps to reduce unplanned downtime and
maintenance costs.
2.9.13.12
TYPES OF STORAGE EQUIPMENT
Proper
organisation and storage of inventory in a storeroom is crucial for efficient
inventory management. There are several storage techniques and equipment
available to achieve this, such as:
1.
Bulk
storage involves storing pallets on the floor in designated areas without
storage equipment. The material is organised in lines 48 inches wide with 12
inches of separation between each line, allowing easy access for counting,
picking, or quality checks.
2.
Demand
flow racks: Material is stored in a way that ensures the oldest material is in
front and the newest at the back. The stock is rotated by binning new material
from the back.
3.
Pallet
racks: Used for bulk material, these racks allow for better space utilisation
and are cost-effective for storing materials with high cubic feet.
4.
Vidmar
storage cabinets: Ideal for smaller stock such as fasteners, computer parts,
tools, rubber products, and products where dust needs to be minimised.
5.
Cantilever
racks: Used for long parts such as steel tubing, long shafts, springs, and
axles.
6.
Drive-in/drive-through:
Parts are stored to enable forklifts to enter from the rear and pull from the
front, making it efficient for a finished goods warehouse.
7.
Flow-through
rack: Utilises the higher cubing allowed by pallet racks and incorporates
demand flow technology to rotate material. It is loaded from the rear and
removed from the front.
8.
Sliding
rack/shelving: The shelves can be moved on the floor to consolidate floor
space, making it a space-saving method of cubic feet.
9.
Shelving:
Metal shelving is a must-have for bin rooms as it is easy to install and can be
adjusted to any height.
10. Rotating shelving: This is similar to the lazy
susan concept, with parts that can rotate to the part that needs to be picked.
11. Rack entry module system (REM): Used to rotate
material more effectively, this system involves movable racks on a track.
12. Carousel storage: Designed to store many parts in a
small number of cubic feet, this system stores parts on shelves that can be
rotated automatically.
Properly
organising and binning inventory in a storeroom using the appropriate storage
techniques and equipment can help to optimise space, improve inventory
accuracy, and facilitate efficient inventory management.
2.9.14 STOREROOM OPERATION
2.9.14.1
UTILISATION AND CONTROL
In
order to effectively manage MRO inventory, it is crucial to adhere to standard
operating procedures for each workflow process, from receiving parts to issuing
them for approved work orders. Storeroom managers must recognise the
significance of following these processes and ensure employees comply. A robust
security policy is necessary to restrict storeroom access during off-hours and
prevent non-storeroom employees from entering without an accompanying store
employee. Allowing self-service in the storeroom is a critical mistake that
will harm inventory accuracy. Storeroom security and inventory accuracy are
interconnected, and it is important to maintain both.
Maintenance
and supervisory employees who require parts during off-hours must be able to
find inventory in the CMMS and issue parts to work orders like storeroom
employees. The MRO inventory has various built-in controls that continuously
monitor and adjust inventory requirements if all workflow processes are
followed correctly. The min/max reorder points should be constantly reviewed
based on usage, balance-on-hand inventory levels, and projected needs for parts
in the coming months. In proactive sites, these needs and decisions are part of
daily work activity, and communication between the storeroom, planning, and
purchasing departments is expected. Regularly reviewing min/max inventory
levels enables better control of overstock and stockout occurrences, reflected
in the monthly storeroom KPIs.
Store
stock repair parts are often overlooked but must be repaired and returned to
the storeroom inventory. A durable tag with essential information should be
placed on the repair item after it is repaired, indicating the store stock
number, part number, and other relevant information. Documentation that ties
the item to a work order and purchase order should accompany the part if it is
being repaired offsite or in-house by the maintenance shop. Some store stock
repair items can only be repaired a certain number of times, after which it is
necessary to purchase a new replacement to maintain the inventory at the
expected level.
During
the receiving process, some parts may not be correct, have the wrong
specifications, or not meet quality standards. Parts that fail quality checks
must be returned to the supplier for credit, and a return authorisation number
and form may be required. The purchasing department or the buyer for the item
typically contacts the supplier and arranges the necessary return authorisation
and documentation for the returned part.
The
CMMS inventory system is utilised by planners and maintenance technicians
daily, and they must trust the stated inventory levels when they search for
parts. The storeroom's credibility is on the line each time inventory is
accessed, and the part's availability may or may not match what is indicated in
the CMMS. The storeroom should not be reactive; instead, it should be a safety
net supplying the parts necessary to get the equipment running. The kitting and
delivery processes can turn the storeroom into a profit centre for the
organisation instead of an expense centre. Planning and scheduling work,
kitting planned jobs, and delivering those kits to the work site can reduce the
time maintenance workers spend going to the storeroom to pick up parts, ultimately
driving the overall equipment effectiveness of operations and production
departments. Accurate data in the bill of materials and MRO inventory are
essential to supporting maintenance reliability excellence and sustaining
long-term results.
2.9.14.2
EXPECTED OUTCOMES OF STOREROOM BEST PRACTICE IMPLEMENTATION
Reduced
inventory levels
•
Increased
inventory accuracy
•
Obsolete
inventory identified
•
Overstock
inventory identified
•
Accurate
min/max inventory levels
•
Work
processes identified
•
Reduced
emergency buying
•
Reduced
inventory stock out the occurrence
•
Increased
operational efficiency of the equipment
•
Reduction
in production downtime
•
Supplier
partnerships
2.9.15 COMPUTERISED MAINTENANCE MANAGEMENT SYSTEMS
2.9.15.1
ENTERPRISE ASSET MANAGEMENT
Successful
maintenance practices in vessel management organisations depend on a robust
information system to track equipment histories and help manage MRO inventory
levels. An effective trend in computerised maintenance management systems
(CMMS) is incorporating enterprise asset management (EAM) features and
functions software, which crew and owners can use to their advantage.
EAM
is being integrated into CMMS programs in various ways. Simple packages enable
manual data entry, such as condition readings, for triggering PM routines and
inventory management. Sophisticated CMMS software connects online to
Programmable Logic Controllers (PLCs) or other shop-floor devices for automated
data collection. For example, linking the CMMS to a radio frequency
identification software package for inventory control enables real-time
inventory management and tracking of PM activity by scanning the tag. The
software analyses incoming data to ensure trends are on target and within
user-defined control limits. If data strays outside the defined limits, the
software can automatically initiate a work order or notify the appropriate
individuals that action needs to be taken to change the current situation. The
software also tracks variance from the target and the worst and best readings.
EAM
and other monitoring programs like it are a form of proactive, preventive, and
predictive maintenance that can be defined as maintenance initiated based on an
asset's condition. Physical properties or trends are monitored periodically or
continuously for attributes such as vibration, particulates in the oil, wear,
and so on. EAM is an alternative to failure-based maintenance initiated when
assets break down, and use-based maintenance is triggered by time or meter
readings.
The
CMMS that can perform all these necessary functions is user-friendly and
well-supported and is the heart and soul of the vessel management
organisation's business operation. Proper investment in CMMS implementation and
personnel training is essential. Investing the time upfront to develop failure
codes and action codes, as well as developing standard conventions as to what
things will be called and how parts will be numbered, can improve the quality
of the CMMS. An essential element of a CMMS is its reporting capabilities,
including reporting tools to analyse and make decisions on facts and data
rather than opinions and assumptions.
When
upgrading the current system or looking for a solid CMMS, the main
consideration is that the system must support operations and maintenance
reliability. Therefore, research and selection of the system that can supply
operational needs for the next 5 to 6 years of operation is crucial.
Unfortunately, upgrades to the current system are also costly, and once they
are in place, they will probably be used until the choice is made to upgrade or
change systems altogether.
2.9.15.2
STOCK KEEPING UNITS
Stock-keeping
units (SKU) are also critical to efficient inventory management. Each item in
the inventory database must have a unique SKU with a detailed part description.
This ensures that there is only one SKU in the inventory records for each
inventory item. For example, if two different warehouses have the same part
number and SKU, the items are identical and have the same part description.
Given the significant investment in MRO inventory across tanker vessel fleets,
standardising SKUs for parts across multiple sites is crucial. However, this is
a massive undertaking and could take several years, depending on the
organisation's size. Despite the challenges, the benefits of standardising SKUs
are significant and can lead to reduced inventories and increased efficiency
with the help of EAM systems available today.
2.9.15.2.1 PART NOMENCLATURE
When
presenting the same item to a group of people and asking them to identify it,
each individual is likely to provide a different response. Some may provide a
brief description, while others offer detailed information. Even if some people
provide the same information, they may do so in a different order; this is
often the case when multiple individuals are responsible for entering part
descriptions into the CMMS or providing descriptions for new storeroom items
without guidance or standardisation. As a result, the Part Master can quickly
become cluttered with disorganised or incorrect data. Therefore, it is
important to establish and follow standard guidelines for item descriptions,
which will help to identify similar parts, reduce the likelihood of duplicate
CMMS numbers for the same part, and facilitate queries for parts within and
across sites to avoid this. While there is no standard or best practice for
establishing part descriptions, some generally accepted rules can be applied
with common sense and a disciplined approach to establishing adequate part
descriptions.
The
most commonly used method for establishing part descriptions follows a sequence
of
•
Noun
•
Attribute
•
Specification
•
Further
description
For
example
Motor,
AC, 3.0 HP, 3500 RPM, FRAME 182T, 115V, 32A, SF1.15, AO Smith H699
(Noun)
(Attribute) (Specification) (Further description).
2.9.15.3
OBSOLETE INVENTORY
Regularly
identifying and removing obsolete materials is essential for the storeroom,
with several benefits. Firstly, it creates more space and improves inventory
management, reducing the risk of damage or loss of inventory due to
overcrowding. Secondly, it reduces the chances of obsolete parts being
mistakenly picked and installed during unplanned work, which could lead to
equipment failure. Thirdly, it helps to rotate inventory properly, ensuring
that older inventory is picked first to avoid exceeding the expected shelf life
of the item. Finally, monitoring the parts in the inventory to identify
obsolete items ensures that the storeroom can maintain an accurate inventory
and that items will provide the expected service life when installed.
The
storeroom should have a monthly budget and a disposal process to scrap,
recycle, or dispose of these items to write off obsolete items. While some
obsolete items may be useful to other operations or inventory liquidators,
using liquidators carries risks, as some items may have legal liabilities
attached. For this reason, many businesses prefer to allow material to leave
the plant site only if it goes to a recycling or scrap dealer. Ultimately,
maintaining obsolete items in the MRO inventory can be very costly in terms of
space, management, and potential legal issues.
Disclaimer:
Out
of Box Maritime Thinker © by Narenta Gestio Consilium Group 2022 and Aleksandar
Pudar assumes no responsibility or liability for any errors or omissions in the
content of this paper. The information in this paper is provided on an "as
is" basis with no guarantees of completeness, accuracy, usefulness, or
timeliness or of the results obtained from using this information. The ideas
and strategies should never be used without first assessing your company's
situation or system or consulting a consultancy professional. The content of
this paper is intended to be used and must be used for informational purposes
only.
