The Uptime Blog
Parts and Service for Complex Equipment - Why So Complicated?
Every parts supplier or service department with a parts counter has a system for managing their replacement parts. So why then do some companies have us singing their praises while others make us curse the experience?
It’s the system, silly
Surprisingly, some parts management systems are still pretty basic with a manual means of receiving, storing, retrieving and reordering parts. This is slow, inaccurate and prone to mistakes. So unless you have a superstar parts guy with a photographic memory who is personally overseeing your interaction, your experience is likely to be much like the system itself, slow and inaccurate.
Other parts management systems may be partially automated, or managed through personal spreadsheets of parts and service information that gets manually updated on an irregular schedule. These semi-automated systems help, but lack the consistency of data and the scalability to adapt to growing businesses. They also lack the capacity to be integrated system-wide on an enterprise level and fail to provide the immediacy of parts and service information needed to make timely repairs.
The parts management systems that are the most effective are those that are integrated on an enterprise level across the entire business unit and tied into the company’s ERP system so that mechanics, service technicians and parts managers can easily identify parts, see recommendations on related assembly parts, and have updates available to help improve service which ultimately improves equipment performance and uptime. These systems help service technicians quickly and accurately find, order, and install the right part for the piece of equipment.
Inefficient systems contribute to cost and complexity
Parts and Service managers relying on manual or semi-automated systems of parts management however are less efficient or accurate, adding to the complexity of the experience and costing more. Consider these points.
- Parts carrying costs: There is a cost associated with having a part in inventory. If too many of the same part are on the shelves, they increase warehouse costs. If too few are available, repair time is extended while parts are ordered, received and distributed. The trick is to accurately estimate the necessary parts to keep the fleet (or customers fleet) up and running without overstocking.
- Parts ordering costs: There is a cost associated with ordering parts. The less sophisticated the parts management system, the higher the per order cost of parts including finding the correct part, calling for availability, issuing a purchase order, shipping (or delivery), receiving, stocking, and order delivery. The fewer the steps or the more automated and accurate the system for delivering the information, the more cost efficient parts identification and ordering can be.
- Service update costs: There is a cost to keeping multiple service locations or multiple mobile service technicians up to date on the newest parts, part numbers, service bulletins, or service training information. Outdated service information causes the wrong parts to be ordered, extends repair times, and unhappy customers.
- Information distribution costs: There is a cost of keeping field technicians, service departments, mechanics and parts managers informed on critical parts and service information. Parts catalog production, printing (or even electronic media preparation like parts catalog CD’s), and distribution can be a costly endeavor. Especially when multiple locations, dealer networks or field service crews are involved.
- Parts mis-order costs: There is a cost to parts mis-orders, which are due in large part to information being inaccurate or outdated (see 4. Information distribution costs). Returns, reorders, and delayed time to repair are costly contributors to equipment repair or maintenance.
Whether you’re the OEM operating your own in-house service department, a dealership working with your OEM or an end user of a piece of complex equipment, running a less than optimum parts catalog system yields the same results. It takes more time, effort and money to keep the equipment running. You, your dealers or your customers pay inflated costs and get an unsatisfactory service experience.
Moving toward a new model
While some parts management teams try to implement one or more single point solutions (like adding more frequent parts catalog distributions, an easier ordering processes, or warehouse inventory improvements) to make parts and service management more organized and keep the high cost of parts management in check, a more holistic approach produces a better result.
A complete service management system is a new approach that is finding support in the service community. Just as Enterprise Resources Planning (ERP) consolidated the concept of business integration into a product lifecycle management type of structure, service lifecycle management (SLM) is now helping to bring together individually run yet related service units inside a service organization. It’s a cross-functional system that supports the service eco-system of a business that enables a full lifecycle approach to customer service and product performance. It optimizes the total value of the customer experience. And it’s how companies will learn to earn more service profitability.
InService EPC, Enigma’s electronic parts catalog is one of several service related software components that integrate together to form a stronger, more holistic service approach. We’re part of the burgeoning SLM concept designed, developed and now coming together under the PTC service lifecycle management approach.
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