So you want to go down the route of achieving best practice inventory management for spare parts.
Or maybe you want to at least understand what consitutes best practice inventory management so that you can implement improvements that take you in that direction.
One problem of course is actually identifying best practice.
What does it look like?
How do you know if it really is best practice?
How does it apply in your situation?
Is it translatable from other industries or geographies?
These questions (and more) prevent many companies from even trying to achieve best practice.
When it comes to best practice most companies think only about metrics, that is, quantifiable values such as inventory levels, stock turns and so on.
Often, the actual measurable value of best practice with these metrics is so much better than most companies actually achieve that it just seems unrealistic to try.
And these values usually cannot be translated across industries or geographies. When companies look to metrics for best practice they are being unrealistic because outcomes are not really best practice; outcomes are situational.
Can someone running an asset-intensive operation in the Australian outback, distant from all major suppliers, really expect to achieve the same values for their metrics as a company operating within the bounds of a major American city, with suppliers at their doorstep? Probably not.
If you are genuinely interested in using best practice as a means of improving your spare parts inventory management you need to look at processes, that is, the way that you manage your inventory.
Your processes are the input to your activity and it is through these processes that you drive the desired output. Therefore, if you implement best practice processes you are likely to achieve the best practice outcome – for your situation.
The benefit of taking the process approach is that process best practices are just as identifiable as metrics but they are also transferable across industries and geographies.
So, using my earlier example, what looks like best practice in a major American city will also be best practice in the Australian outback.
You might also be interested in this video:
5 Common Techniques You Should NOT Use for Spare Parts Management
Author: Phillip Slater