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Service Parts planning metrics

Are we using the right metrics for planning our service parts?  The reason for storing spare parts is to be able to repair equipment within a required time. This time is set by the mission requirements and the contracts established. Most often, these requirements are then translated in min/max stock, EOQ, ROP,… The fact that these are static numbers doesn’t recognize the dynamic nature of the Defense business. Mission requirements may vary over time, flight hours and cycles, etc.  Hence our first statement: dynamic sparing delivers a better service/cost ratio than static approaches by lowering the cost.  This brings us to the next point; how do we measure service levels? Here too, the classic fill rate measures fail to relate the real goal – mission readiness – to the measured figures. Let’s take an example; 10 aircraft are down and each requires 10 parts for being repaired. If the required service level is 90% fill rate, it could very well be achieved by having 9 out of every 10 required parts available for every airplane resulting in zero aircraft read to fullfill their mission! Or, 9 out of 10 orders could be fullfilled with the last one having zero parts available. Result? 9 planes ready. As one can see, the result is very different whereas in both cases the performance indicator (90% fill rate) would say everything’s OK. Readiness Based Sparing alligns the goals (mission readiness) with the sparing strategies and measurements. What is being measured is the availability of the equipment. This requires different metrics but also different sparing tools able to capture the relationship  to the mission readiness and between parts. Hence our second statement: realligning the metrics for measuring the performance and for determining the sparing strategies with the mission goals improves the service/cost ratio by improving the service levels.
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