Reduce Spending and Make the Most Out of On-Hand Inventory
Effective MRO and indirect inventory management is crucial for any business looking to reduce costs, minimize risk, increase profits, and stay competitive. An important part of this is making full use of on-hand MRO and spare parts inventory. However, outdated inventory management and procurement strategies can make this especially challenging, leading to operational bottlenecks and eventually, financial losses.
New strategies can help avoid these pitfalls and maintain a cost-effective MRO inventory management strategy that prioritizes using what’s on hand rather than spending on what is not.
Avoid outdated inventory management strategies
Combat overstocking with AI-powered analysis
Many businesses still make the mistake of overstocking MRO equipment, whether intentional or not, so that they have the necessary parts on hand to help them with maintenance, repair, and daily operation. However, this not only ties up capital but also increases the risk of wasted and unused assets.
Abandon overstocking and inconsistent procurement strategies to instead leverage the power of predictive analysis powered by artificial intelligence. By analyzing historical data, predictive analysis can accurately forecast future inventory needs. This makes it possible to maintain a more cost-effective inventory strategy, without sacrificing efficiency.
AI-powered analysis tools work on a micro and macro level, making it easy to treat each asset and maintenance material on a case-by-case basis. It cuts assumption and guesswork out of MRO procurement, allocating appropriate expenses to spare parts and MRO inventory that need the most attention. It also ensures that your on-hand inventory is where it needs to be, rather than letting it sit unused elsewhere.
This strategic approach allows businesses to maximize the value of their on-hand inventory while minimizing waste and overhead costs.
Use tools equipped with natural language processing to increase visibility
Natural Language Processing (NLP) is a subset of Artificial Intelligence (AI) that enables machines to interpret and analyze human language.
This tool can help from an operational and organizational perspective. Take, for example, the way that procurement and inventory information is housed and organized. It’s common for most organizations to use the language provided by vendors on a site-by-site location. This doesn’t prove to be a problem until it comes time to locate parts with slight naming differences in the way alternate vendors identify them. This can make it nearly impossible to locate on-hand inventory, particularly when relying on ERP and EAM solutions that don’t possess NLP capabilities.
NLP seeks to solve this problem by synchronizing data nuances and variations to reveal both critical shortages and costly overages. It also offers procurement and operations teams the ability to use fuzzy search-engine-like features to find what they are looking for and prioritize using on-hand inventory for maintenance projects.
Businesses can also use NLP to capture and analyze a vast amount of unstructured data from sources to identify trends, preferences, and areas for improvement, allowing teams to make data-driven decisions about their inventory management strategies.
This includes helping procurement teams monitor supplier performance and identify potential issues before they become problems. By analyzing supplier contracts, invoices, and other documents, NLP-powered tools can flag issues such as inconsistent delivery times, quality issues, and pricing discrepancies.
This level of visibility and control over supplier performance enables businesses to make informed decisions about which suppliers to work with and how to optimize their purchasing strategies for maximum efficiency and cost savings.
Maintain a cost-effective inventory management strategy with the cutting-edge MRO tools
Make inventory tracking and data sharing a standard practice
One of the key benefits of MRO tools is the ability to automate and streamline inventory data analysis. By using their MRO data as it currently exists, businesses can automate AI-powered inventory analysis and prioritize using on-hand inventory before looking to place more orders. This enables businesses to maintain optimal inventory levels while minimizing the risk of stockouts, excess inventory, and waste.
Another benefit of MRO tools is their ability to facilitate data sharing and collaboration across different departments and locations. Cloud-based platforms allow businesses to integrate with existing ERPs or EAM systems, which can provide real-time visibility into MRO inventory levels, usage patterns, and demand forecasts.
This level of collaboration enables businesses to make informed decisions about MRO inventory management strategies and adjust their plans based on real-time data.
Partner procurement and inventory management to create a resilient system
By integrating procurement and inventory management systems, manufacturers can streamline their supply chain operations, improve efficiency, and reduce costs.
MRO tools can help operations teams track inventory levels and measure them up against demand forecasts to create procurement strategies that are robust and resilient. These insights and data-based decisions can help avoid downtime events and prevent overspending.
This software works end-to-end, helping teams automate procurement processes and schedule maintenance events. This level of efficiency enables businesses to reduce lead times, improve supplier performance, and optimize their purchasing strategies for maximum cost savings.
Upgrade your approach to inventory management
In a rapidly evolving supply chain landscape, it no longer makes sense to stagnate with outdated, traditional, MRO inventory management practices. These systems hinder progress and negatively affect a company’s bottom line.
Harnessing the power of digital systems not only helps companies make use of their existing assets and inventory, but they can also help streamline other aspects of day-to-day operations. Learn how you can reduce spending and make the most out of on-hand inventory with intelligent materials management solutions.