Duration 3 -5 days
Most companies do a bad job of managing their inventory effectively. There are many reasons for this, but it usually starts with bad submission of vendors recommended spare parts data, poor cataloguing and selecting initial spares
From our experience this is not limited to any one industry. Irrespective of the industry, e.g. Oil and gas, mining, power, food & drink, electronics, semi-conductor plants, all do a bad job of managing spares leading to excess costs
This practical 3 day workshop covers aspects related to reducing inventory and costs of spare parts and is supported by case studies, software and practical exercises to aid understanding
This workshop focuses on reducing the inventory, which is an area often overlooked
There are very few courses conducted that deal with the practical issues of spares cataloguing, optimising spares and stock reduction
After this course, delegates will leave the workshop with tools and techniques that they can immediately apply in their own companies and start to reduce costs
An Excel Analysis worksheet containing all formulae will be provided to conduct an audit of current inventory parameters
Two analysis techniques will be covered; first using probability for normal operating and consumable spares and the second using simulation (modelling) techniques for high value spares with logistic issues
The course is of particular benefit to companies who:
Many case studies will be shown including reduction of 50-70% in line items
Course Introduction
Delegates' issues
Common issues in inventory management with real examples
Where we incur excess costs
Benefits of improved inventory management
Terms and definitions used in the workshop
Introduction to a 30 tactic inventory reduction programme, tactics including, but not limited to:
Introduction and detailed examples of an 8 step cataloguing process, i.e
Many examples collected from our numerous studies will be shown
RSPLs, their purpose and why they are submitted incorrectly, principles good spares cataloguing to ensure zero duplicates, and ease of searching
A critical review of a typical RSPL form and the associated procedures sent to vendors
Examples of good and bad RSPL
10 rules for effective use of RSPL
Proposed improved format for an electronic RSPL
Different costs used in the stock management process, e.g. buying, holding cost, item cost, issue cost, penalty cost, average stock level costs, annual issue value
Normal & Poisson distribution
Weibull parameters for high value spares
Explanation of service levels
Importance of the P-F
How to estimate annual usage using MTBFs or reliability data sources
How to calculate estimated annual demand rates based on spare reliability
Case studies where actual consumption has exceeded initial estimates
Different approaches to set safety stock
Using the Poisson distribution to set re-order points based on lead time, annual usage and criticality and the typical issue quantity
Different replenishment strategies such as ROP control, Min-Max and Constant Vendor Delivery
Exercise - setting re-order levels using formula based on the Poisson cumulative probability tables
How to determine the economic order quantity using both a formula and a tabular approach
The effects of ordering too many or too few
Evaluating whether discounts are worth accepting for higher quantities
What to do if the EOQ is not practical
Introduction to 25 inventory formulae, use an Excel worksheet to seek opportunities to reduce stock levels and stock holding costs
Metrics include service levels; safety stock, ROP, Average stock levels, no of years of stock, Annual Issue Rates, and Value, Stock holding value all calculated at line item level
Demonstration of an MS Access based application to simplify the analysis
Demonstration of an MS Access Based Application to simplify the analysis
Introduction to Monte-Car lo simulation and penalty costs to evaluate policies for insurance spares
Sometimes the ROP/EOQ strategy is not appropriate, discussion on other options
Purchasing & Inventory KPIs
Performance management system
Maintenance Managers, Engineers
CMMS super users
Warehouse Managers & Supervisors
Project Engineers
Spares & Inventory Personnel
Purchasing & Logistics
Cost Controllers
PowerPoint slide. Delegates will learn by active participation during the workshop and through the use of exercises, case studies
Laptop required
David Thompson has over 40 years in the field of Maintenance, Reliability & Spares Optimisation
As a consultant David has conducted 100s of different types of audits, developed strategy and procedures and has been involved in CMMS builds and data revamps. He has worked in the oil and gas, petrochemical, mining and many manufacturing companies
He was the UK representative for Reliasoft Corp, one of the world's leading providers of Reliability Analysis software and a certified instructor for the Taproot RCA/RCFA process
David has conducted numerous courses in reliability, including public as well as in-house courses for SABIC, Qatar Petroleum, Wood Group, Shell Nigeria, First Quantum Mining etc.
David has also presented at Reliability Symposiums in Brazil, Europe and Asia and is an external online instructor in Reliability for the Robert Gordon University
This spares course has been conducted very successfully in Asia, Africa and the Middle East