Maintenance Management 4.0 - With Software to Success

Maintenance Management 4.0 - With Software to Success

The main objective of maintenance management is to ensure equipment and machine availability and avoid unplanned downtime. This is because the costs caused by unplanned downtimes quickly amount to six-figures, or more in the worst case, especially when it comes to highly automated and closely interlinked production processes.

It is specifically annoying when a repair is delayed because an urgently needed spare part is not available. It is common practice for manufacturing companies to stock numerous different spare parts in their own warehouses in order to counteract this problem.

From the perspective of maintenance, this is a risk-minimizing preventive measure. But from a business perspective, it means a lot of tied working capital. SPARETECH analyses indicate that the inventory volume for machine and plant spare parts of an automotive production plant amounts to an average of € 42 million.

At the same time, the risk of machine downtime cannot be completely eliminated because not every spare part can be kept in stock due to the enormous number of different variants. Each month, there are on average two hours of unplanned machine downtime due to lack of spare parts. Especially in case of emergencies, the procurement costs for spare parts increase. On average, along SPARETECH's automotive and consumer goods customers, € 8.4 million is spent annually on procurement costs for machine and plant spare parts per site.

Why tackle spare parts management?

This article addresses the fundamental underlying problems and causes, as well as respective solutions, in order to increase plant availability and reduce the resulting procurement and factory costs.

Initial situation: Equipment procurement

During plant procurement, the operator is provided with the plant documentation prior to commissioning. This also includes spare and wear parts lists for the respective plant sections, modules, assemblies and spare parts contained therein.

The analysis of a spare parts list marks the beginning of the maintenance planning work. Basically, the process follows five key steps:

1. Indexing of list items

2. Stocking decisions

3. Request for quotes

4. New record creation in the system

5. Procurement and goods in process

1. Indexing

The first step of indexing already presents several challenges. First, it is crucial to analyze which spare parts are being referred to in the list items of the spare parts list. Often, there are discrepancies between the information in the list and the original manufacturer's information, especially with regard to part numbers, type codes and short texts. There are various reasons for this: Since spare parts lists are often generated manually and usually transferred to customer-specific formats by hand, however, inconsistencies can occur.

Duplicates in the spare parts list and identification by SPARETECH.

When the identification of the individual spare parts items has been completed, it is important to be able to reliably detect duplicates within the list. Current practice uses methods like Excel vlookup, taking into account deleted special characters. The fact that this method does not work very reliably even with the smallest differences in description is obvious and in practice often causes frustration among the people involved.

As soon as a best possible duplicate-free version of the present spare parts list has been created, existing material numbers and spare parts in the warehouse have to be compared. This process is particularly important in order to avoid buying spare parts that are already in stock.

Duplicates check between the new spare parts list and the existing material master

In nearly all cases, the difficulty during this step is that the descriptive texts of the spare parts list differ from the information in the company's internal ERP system. Only rarely are the type codes, part numbers and description texts identical. This is another area where common methods such as Microsoft Excel reach their limits.

2. Stocking decisions

After indexing, step 2, the stocking decisions, begins. Numerous, largely company-specific approaches are available here, ranging from data-driven classification tools to purely expert assessments based on empirical values.

Frequently, classic methods such as ABC and XYZ classification are used. Similarly, some companies determine so-called risk priority numbers to best support the decision at spare part and/or component level to stockpile. Common factors considered in a risk priority number include:

  • Delivery time
  • Price
  • Number of shifts
  • Estimated probability of failure
  • Expected future demand

Additionally, in some cases, the shift model is taken into account, as well as the storage costs or information on shelf life.

Ideally, the result of a stock assessment is a duplicate-free list of spare parts to be procured that do not yet exist as material numbers and are not currently kept in stock. For list items that are already in stock, change proposals can be developed, for example, to adjust the replenishment parameters for these materials, such as slightly increasing the safety stock.

3. Request for quotes

The third step involves obtaining quotes. Here, various options exist. On the one hand, all spare parts can be procured directly from the general contractor (so-called one-stop shop). On the other hand, offers can be obtained from the respective original manufacturer for the corresponding spare part. In this case, there are significantly more quotations to be prepared, sent out and responses to be given.

From an economical point of view, the best possible approach is often the middle ground. Machine-specific assemblies and spare parts are purchased directly from the machine manufacturer. On the other hand, it may make sense to bundle smaller components and procure them via wholesalers. Other components for which framework agreements have already been negotiated with manufacturers should ideally be procured directly.

4. New record creation in the system

When the request for quotes has been successfully completed, new material data can be generated in the ERP system. In practice, numerous different practices are used here: from manual entry in Excel, Access or Word input masks, to self-programmed or purchased add-ons, or the direct input screen in the ERP system.

Excerpt of a data entry form for new spare part record creation (Source: anonymous manufacturing company)

Often, existing solutions are not very intuitive and cost users a lot of time. In addition, all data must be manually transferred to the input forms, which leaves room for error. The result is incomplete, incorrect data records, which are then difficult to locate using the existing search functions in the respective system. 9 out of 10 SPARETECH customers state that they waste far too much time searching for spare parts in their own system - an average of 2.5 minutes per search process.

5. Procurement and goods in process

The next step is the procurement of spare parts. A purchase requests triggers the order via common purchasing transactions. Following successful delivery and goods-in inspection, the materials are placed in storage, accounted for according to the storage locations and then wait to be used. However, procured spare parts are often never used because the assumed "demand forecast" in the course of the stockpiling decision was not sufficiently precise, so that at the end of the life cycle, spare parts that are not needed are often scrapped.

For an average automotive factory, the costs for this amount to a six-figure sum. At the same time, the ecological dimension is questionable, since functional spare parts are scrapped that were created with a high input of material, energy and capital.

In current corporate practice, the entire process from indexing to scrapping or consumption of the part at the end of its life cycle often takes 20 days, and in some cases several months.

Digital Maintenance Management - With software to success

The problems in spare parts management can be solved by using intelligent software. This reduces the overall lead time from 20 days to just a few minutes.

SPARETECH offers a digital and automated software solution to drastically reduce the high capital commitment costs, procurement costs and manual effort.

The web-based application contains two modules:

1. Digital Workflow and 2. Data Lifecycle Management.

The main modules of digital spare parts management software

The digital workflow of SPARETECH includes both the single new creation of materials with verified manufacturer data from the SPARETECH database, as well as an automated spare parts list verification (BOM check).

Data lifecycle management ensures the identification of all spare parts and duplicates in the material master and completes the data records with product and reference information. In the near future, it will also be possible to continuously maintain product data through manufacturer updates (obsolescence management).

The Software as a Service application has reduced inventory levels by up to 21% on average across a wide range of customers like Bosch, Hydro Aluminium, Wepa, and many more. At the same time, maintenance costs were significantly reduced.

Leading international companies such as Bosch, Porsche and Volkswagen already trust SPARETECH's digital solution and use it profitably in their day-to-day operations.

Contact us to get your free trial and a quick check of your savings potential. We look forward to hearing from you.


Images: SPARETECH GmbH & Unsplash

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