June 07, 2011 at 1:04 PM

By Nupur Agrawal, AR & PR Lead, Zynapse

10 Epic fails in MRO Master Management Data

Most business enterprises typically put their energy, resources and investment into things like product design, sales and marketing, production efficiency, tight process control, information technology, and supply-chain management both for inbound flows of direct materials and outbound flows of finished goods to end customers. With so many important priorities vying for attention, managing a company's MRO supply chain has typically been quite neglected.

This article highlights the 10 Epic fail in MRO Master Data Management.

1. Free-text MRO description: Unleashing people's inner Shakespeare by letting each one choose their own words and writing styles to describe MRO items in ERP results in item descriptions that are cryptic, randomly and differently abbreviated, and often unintelligible to anyone other than the person who created them (and even to the person who created them if enough time passes).Eg. Is it a ball bearing, a brg, a ball brg, a bb, b bear, a balbr, a bearing/ball type? a bearing (type unspecified)?
2. Free-for-allI ERP Access: If anyone from facilities manager to storehouse operator is allowed to create new MRO item and supplier masters in ERP without providing protocols, policies or guidelines, then it results in massive duplication of records.
3. Taxonomy-free MRO: Having no discernible taxonomy forces search and analysis activities into labor intensity and failure. Simple, high-level taxonomies may help somewhat with search, but leave detailed drilldown type analyses virtually impossible to accomplish without ad hoc manual or external classification exercises.
4. No Ownership: Giving people direct access to create item and supplier masters in ERP without a Master Data Management (MDM) solution layer primed for data validation is just asking for incomplete, inconsistent and inaccurate data.
5. No workflow for MRO: Workflow makes certain the right people pay attention and participate in the process. Most important, though, workflow makes it as easy as possible for a person to comply with policy.
6. MRO safety stockpiles: failure to find a part in inventory may lead to an unnecessary order, it can also lead to unnecessary inventory. Safety stock might sit for years, dragging down MRO inventory turn rates and may still be sitting long after a machine has been taken out of service, causing obsolescence in MRO storerooms. Without any feasible ways to create clean, enterprise level views of MRO stockpiles, inventory optimization endeavors are doomed to fail.
7. Preventive Maintenance:  While preventative maintenance is typically triggered by testing, visual inspection, electronic sensors and/or OEM recommendations for maintenance scheduling, insight into real parts consumption as it relates to particular machines might go a long way to making preventative maintenance more science than art. Dirty MRO master data, however, makes such a scenario impossible to contemplate.
8. MRO Demand forecasting:  Inability to accurately read MRO consumption patterns from an enterprise level undermines an organization's ability to predict demand for consumable MRO items.
9. Cash Management & Liquidity:  Cash tied up in inventory or spent on non- or negative value adding work is not earning returns, hampering investment in innovation, capital expansion, future business development and growth. It also forces enterprises to finance more working capital for longer periods than necessary.  In relation to MRO, the lighter-colored buttons are rendered unpushable or only partially depressible when MRO item and supplier master data is duplicated and dirty. 
10. Performance Management:  Systematic problems like poor MRO Master Data Management can affect many people's job-performance metrics negativelyin ways that are not under their direct control. This corrupts the company's performance management system, leading to great personal frustration and low morale.  These failures thus provide us with a picture of the vast duplication, misclassification, inconsistency, and inaccuracy that permeates typical industrial enterprises' ERP ecosystems related to MRO.

Download  10_Epic_Fails_in_MRO_Master_Data_Management.pdf here