What’s in It for Me?

By George E. Krauter

December 01, 2016 at 7:37 AM

Companies that offer onsite MRO management programs (third-party MRO or 3PMRO) are able to prove substantial savings for their client’s total cost of ownership (TCO). 

These savings are in the form of financial and non-financial benefits which accrue in varying levels to various plant disciplines.

For example, price reductions are beneficial to procurement, stock on hand when needed affecting less downtime is important to maintenance, lower inventory and less cost of paperwork resonates with finance, and the reliability of plant assets is meaningful to engineering, as well as maintenance.

Here’s the rub. When the 3PMRO company becomes aware of a prospect in need of MRO TCO recovery (whether they know it or not, it will try to get to the highest level of management because management must be able to see the potential benefits that will accrue before approval to change is forthcoming. Too many times when a company is approached, the seller is asked what product category they are soliciting; when the seller mentions MRO, they are sent to the MRO buyer.

There are interesting exceptions to what I am going to say next; however in most cases, the MRO buyer will see 3PMRO as a process that will eliminate the buyer’s job. In the real MRO world, the MRO buyer is elevated to a higher level of supervision via managing this new process (3PMRO) that has provided new channels of profitability. The buyer’s employment level is enhanced.

So, here we are. Since there is no other option, the 3PMRO presentation is made to the MRO buyer. Verbalized or not, the buyer has in mind, “What’s in it for me?”

This makes sense, because, although, every employee should be thinking of company improvements, every associate will think, “How will I benefit?  Will this improve my chances of advancement?” Three situations occur:

One, there is recognition of total benefit opportunities; proactive reactions occur: The MRO buyer sees the benefit to the company and to him or her personally. The proposal is taken to the proper management level for assessment and approval to proceed.

Two, there is recognition of total benefit opportunities; negative reactions occur: The MRO buyer smothers the 3PMRO concept and acts to keep it out of the company’s reach. This is really foolish from an objective prospective, because, if the traditional buyer’s function can be saved via a better procedure, it is eventually doomed anyhow.

Three, there is no recognition of potential benefits for anyone: The buyer listens to the proposal, files it away, and returns to the daily MRO process. “It’s not my job to change anything.” “This is above my pay grade.” “If I stick my neck out and it does not work, I will look bad; I better not do anything and be safe.” Follow-up actions from the 3PMRO are met with, “There seems to be no interest.”

Obviously, number one benefits all. Numbers two and three are equally bad for the 3PMRO, the buyer and the company. What is the answer? 

A presentation that answers the unsaid question, “What’s in it for me?” can get movement to the decision makers. 

My Purchasing Center recorded a series of interviews with Blogger George Krauter:

Banging Head Against Wall? Overcoming Resistance to Change

How to Calculate the Cost of a Purchase Order

The Market Basket to Select an MRO Supplier: A Flawed Process?

Download podcast


Tags: purchasing MRO indirect Outsourcing Supply chain management Careers Procurement sourcing
Category: Blog Post

George E. Krauter


George Krauter, former founder and president of Industrial Systems Assoc. [I.S.A.] has retired as vice president of Synovos.

Currently, he has initiated, "George Krauter Consulting [GKC]"  for effective reliability and cost recovery for consumers  of MRO materials. George is a recognized authority on the management of the MRO supply chain and support for maintenance reliability programs. His book, "OUTSOURCING MRO...FINDING A BETTER WAY" is available from Amazon and from Reliability Web.com.

He is published in Uptime, Modern Distribution Management, and Supply and Demand Chain Executive. George has conducted seminars across North America, in Europe, and in the U.A.R. as well as a guest speaker at Temple U., Howard U., Duke, and MIT.

George is a graduate of Temple University; he lives with his wife, Joyce, in Bucks County, PA. All grand kids live within eating distance. He can be reached anytime:   georgekrauter@comcast.net.

Please add a comment

You must be logged in to leave a reply. Login »

Related Content

Thought Leadership and the Demise of Your Third-Party MRO Outsourcing Program: Part 4

George E. Krauter

When one defines third-party MRO (3PMRO) success, one assumes that fundamental operations are being executed and that expectations are being met (i.e., ROI goals are surpassed} Read More

Guidance for Addressing the New Talent Acquisition Challenge

Dennis Bouley

The US Labor Department reported in March of this year that there were 6.6 million job openings, a record high. Although most of us applaud these numbers Read More

Millennials in Supply Chain Management Seek Advancement and Development Opportunities

Marisa Brown

Millennials working in the supply chain management field don’t fit the mold that the older generation assumes for them. APQC’s recent study Read More

Supplier Profiles


Staples Advantage is the one supplier that offers all the business solutions you need, all with the expertise of a specialty vendor. Read More


It started in 1972 with an idea, a new concept in distribution. Today, Digi-Key Corporation is one of the fastest-growing electronic component distributors in the World. The stimulus for this growth is Digi-Key's customer-centered business philosophy… Read More

Lunney Advisory Group

Lunney Advisory Group was founded in 2007. Our firm is not your typical consulting company. Some members of our firm are highly qualified and experienced industry executives/practitioners while others are full time or adjunct university professors.… Read More


What CEOs Expect Of Purchasing

Guest Contributor

Procurement and supply management leaders have a seat at the table, and management’s expectations are high. But what do CEOs really want, and is purchasing delivering on these expectations? This webcast looks at how procurement and supply management … Read More

Growing Purchasing Influence On Indirect Spending

Guest Contributor

At world-class companies, purchasing’s influence touches just about every area of spending. But, how exactly do procurement teams get to the point where other departments approach them for help with sourcing such indirect categories as human resource… Read More

Procurement-Finance Collaboration

Guest Contributor

Procurement & finance are two business functions which are often at loggerheads with each other. One reason for this is the lack of perception alignment on an important metric of procurement and finance performance - 'savings'. Read More