Digitisation of the end-to-end maintenance supply chain

MANUFACTURING SUPPLY chains have been subject to unprecedented turbulence by a variety of economic-related events, leading to a profound impact on the sector. This has focused organisations on resilience like never before, as firms try to implement procurement processes to help mitigate the risk of vulnerability - vulnerability that has been highlighted in recent years with events from the pandemic and Brexit through to the Russian invasion of Ukraine. This, along with soaring inflation and energy costs, means volatility has very much become the norm.

But just as important as resilience in the industrial sphere - if not more important - is keeping production running, and avoiding downtime that can lead to profit loss and customer dissatisfaction. While a focus on maintaining the availability of direct manufacturing supplies which are used in the finished product is crucial, ensuring the availability of indirect supply stock is what will keep operations moving. Indirect 'MRO' procurement is often seen as the poor relation when it comes to procurement of supplies.

In a sector as diverse as UK manufacturing, which is underpinned by many small-medium businesses, the embrace of digitisation has been slow. The perceived investment requirement in large-scale IT or technology projects, presents a barrier to the implementation of technologies that ultimately aid supply chain resilience. 

This issue was highlighted in a recent Make UK survey, which showed that while 42% of manufacturers plan on increasing investment in technology to facilitate agility in their supply chain, 28% stated that they haven’t even developed an approach to the implementation of digital supply chain solutions. With only 20% of surveyed manufacturing firms saying they were at an advanced stage of implementation, there's undoubtedly still a way to go. However, when it comes to strengthening the supply chain of indirect supplies, organisations don't necessarily have to make any significant investment in IT.

Bringing a consumer eCommerce concept into the industrial world 

Digitisation of supply chains isn’t beholden to major investments in IT, but instead embraces the same concepts of eCommerce that we experience in our personal lives. Some industrial distributors still offer a very basic eCommerce experience and phoning through to branches to enquire about industrial parts, consumables and their availability is the norm for customers. It’s a process that is a million miles from the online retail experience which most of us use as a benchmark for our expectations and is a time-consuming procurement process fraught with inefficiencies.

Availability of crucial parts is key, and so while having big inventory stores full of maintenance components ‘just in case’ is a safe option – seen particularly during the pandemic when lack of supplies made firms act more cautiously - it’s not always viable from a cash flow, inventory storage or procurement process point of view. This is where using supply partners offering digital procurement solutions can help with online live product availability and ensuring maintenance stores are stocked smartly with the right products at the right time, based on consumption data - to avoid gaps in availability that can lead to costly downtime or overspend.

Leveraging partnerships 

Since investment and lack of knowledge or confidence on where to start can be a barrier to technology implementation or use, firms should look to embark on their digitisation journey by working with strategic partners. Using external solutions and services paves the way to technology adoption, negates significant IT investment and can be implemented swiftly, allowing businesses to see the benefits quickly and be agile in a changing and uncertain world.

Data is all around us and is at the core of effective supply chain management, so it makes sense to work with solutions providers that capture and share that data with customers, helping them to see and understand more about their operation. Working with a partner with the right solutions and high consumption data capacity, that can help you with a find, buy, stock, track, use, report and learn approach - all enabled by data from combined digitised solutions – is invaluable. Using a digitised stock system or tool via a partner will mean less stores of slow-moving stock, and ensure your stock investment works harder. The automation available now through managed inventory solutions means supply order replenishment is provided – negating the headache of manual stock control for engineering teams.

Empowering engineering teams 

A significant amount of time can be spent on manual processes around procurement of indirect supplies which is why sometimes procurement managers may stock more than what is needed to offset the resource invested in the procurement process. But when the process is executed electronically via a solution, making and gaining approval on orders is totally streamlined. Leveraging the flexibility and visibility of procurement solutions enables procurement managers to help engineering teams do what they need to do, quickly. In an increasing scenario of the hybrid working model, a buyer or procurement manager may not be on-site every day, so an online electronic purchasing process greatly aids efficiency and keeps the plant moving.

Reducing complexity in the maintenance supply chainy

Using a number of digitally able suppliers offering embedded solutions may solve some procurement pain paints, but becoming intrinsically tied into one supplier reduces complexity, and enables a 360-degree view of consumption data that facilitates the agility that is so crucial in today’s economic climate. 

This is a concept advocated in the BDO viewpoint in Make UK’s Q3 Manufacturing Outlook, which cites increasing operational efficiency through reduction of complexity as a key area of opportunity. Some of the benefits offered include reducing stock keeping units and automating where possible. Of course, as well as the data providing enhanced stock visibility to ensure stability in stock levels, the efficiencies that can be gained from working with one supplier are infinite. Consolidating processes around purchase order generation and invoice raising and paying, with one organisation, is a huge time-saver in itself.

While digitisation might sometimes feel like a forced measure in response to external turbulence, it’s a real driver of competitive advantage and efficiencies that can directly affect the bottom line. For maintenance engineering operations, a full ‘procurement to application’ end-to-end digitisation of the maintenance supply chain brings resilience, flexibility and competitive advantages in an increasingly volatile landscape. Reducing supply chain disruption of indirect or direct supplies that pose a significant threat to business profitability or even survival, is something no organisation can afford to side-line.

Ed Orgill is head of value added services sales at RS

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