Storerooms and Listening to Customers (VOC)

One of the first supply chain projects that we did at a large chemical company in Alabama which involved frequently used MRO parts by the maintenance folks. First we did an As Is process map! Highly paid maintenance personnel ($30 per hour) were driving in pickup trucks, in pairs, to go to a central storeroom to pick up basic and frequently-used parts. The time lost was enormous. The feedback we got from the maintenance personnel (VOC) was that they did not trust the current system at all. We were a chemical company, and our expertise or core competency was not in storeroom, or MRO parts management. We started a supplier search for dis­tributors with expertise in management parts and storerooms. We decided to basically outsource the management of these fre­quently used parts to the distributor. They examined our store­room data, provided us software, and soon discovered the one hundred parts most-frequently used by our maintenance folks.

In other words the distributor did the To Be process map for us! Since they had strong credibility the Kaizen team formed. They then set up many free-issue or mini-storerooms throughout the large chemical plant’s grounds. Our mainte­nance folks traveled or walked to these areas to get the parts they needed. The distributor maintained and restocked the areas. The distances were much shorter and conveniently decentral­ized. The maintenance people set up a steering committee (another best practice) with the distributor to review parts usage and add or subtract parts to the mini-storerooms. In Kaizen terminology this was To Be metrics! The process was greatly simplified, and the maintenance people soon developed a high degree of confidence in the distributor and the streamlined system. Then the distributor offered to reorganize our storeroom and barcode all the parts at no charge. We quickly agreed.

In another month, a shocking development occurred. We were not sure how to quantify the savings from this project and were worried that many people would not appreciate the soft savings. As stated above, many of our maintenance people had no confidence in our current storeroom system. We publicized a return-any extra-parts-with-no-questions-asked week. This was run much like a fine-free day at your local library. Our maintenance people returned over $2 million-worth of bogey or just-in-case inventory that they had been squirreling away in their toolboxes and other areas. They’d done this because they’d had zero confidence in the old system. Our new supplier accepted the parts back and gave us a large credit for the returned parts that were still usable. The distributor kept us abreast of any new storeroom-management techniques and technologies, including the RFID (Radio Frequency Identifica­tion Device). We developed a long and lasting relationship with them which became the model for our other chemical plants.

By just using a few tools of the Kaizen methodology we experienced a huge success!