Q: A question I have is how do we measure reduction in consumption of MRO? It seems a highly problematic area (to me at least!). We have a complete data set of usage and spend for the past 12 months and are seeking to measure the impact of control systems we are putting in place. By way of example, we are proposing to measure PPE consumption by department against hours worked. For example, 82,000 hours per month with a PPE spend of $60,000 gives us a benchmark of $0.73 per hour worked. We can then monitor this month on month against previous year to measure. When it comes to maintenance expenditure, the question is how do we measure this? One thought was to divide MRO spend on maintenance by maintenance hours worked. However this seems simplistic and flawed. Your comment and experience would be very much appreciated.
A: I am wondering what’s behind the problem – on the surface it doesn’t seem too complicated and you have some measures in place already. What are the control systems that you mention trying to control? Overall MRO spend? PPE spend? I assume that you are concerned about man hours because you want to rule out increases or reductions resulting from changes in work load. Correct? Are changes of any significance expected? With respect to maintenance it would seem reasonable to exclude the impact of extra or less PM or corrective activity. So, it all depends on what the specific control system is aimed at. Ultimately, I assume that the company wants to spend less so just measuring that at a headline level over time, correlated with operating hours, seems like it aligns with the overall goal.