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Spare Parts for Maintenance-Repair-Overhaul: The Intelligent Supply Chain for Assets


SAP Intelligent Asset Management and Plant Maintenance Solutions are designed to assure that the assets are always up and running by extending its life cycle. This usually happens by predicting and preventing assets failure and determining the optimal maintenance schedule to increase the asset health. Now, imagine in case of a machine failure, the spare part needed is not available in stock?! This might result to an unexpected complete freeze and shutdown of the supply chain for several hours or days till the delivery of the critical asset is made, resulting in millions of operational costs loss! Analysts says that unscheduled assets downtime from lack of spare parts reaches up to 50% on yearly basis, which is quite alarming.

In this blog, I focus on how companies should consider their asset as a customer? Using SAP latest innovations to predict, maintain and plan the spare parts inventory level. I shed the light on the study we did with customers and my plan as I set industry best practice and co-innovate on functionality improvements with leading customers in Energy & Natural Resources industries.

Customer Study

Several Customers in the area of Energy & Natural Resources are facing massive costs challenges due to Maintenance-Repair-Overhaul (MRO). Let’s take an example of Roy Hill an innovation led iron ore miner in Australia. In a recent study I sat with their Supply Chain director and architects, we found out that traditional improvements were never able to address the problem of timely material flow and assets up time, which has a huge impact on profitability. 1 hour of downtime could result in millions of dollars in lost production!

As a result, by embedding sensor technologies and latest physics based Digital Twins, Roy Hill considered their Asset as a Customer. Getting sensor maintenance data to supply chain planning resulted to maximizing service levels and asset performance, increasing asset uptime and minimizing costs. This was possible by getting maintenance plans closer to Supply Chain Planning allowing us to predict and manage spare parts inventory efficiently using SAP Integrated Business Planning (IBP).

Solution Capabilities

As part of SAP’s Intelligent Enterprise, we are rethinking and transforming MRO to get demand planning, maintenance planning and inventory optimization closer together. The solution will focus on overcoming any unexpected maintenance delays due to lack of spare parts availability in stock. Integrating IBP Demand & Inventory Optimization with Intelligent Asset Management solutions will allow customers to create a stocking strategy that prevent stock-outs and make the best use of the customers and partners warehouse. By making sure that the right parts are available at the right time and the right place, the mean time to repair and improve maintenance quality will be shortened.


Spare Parts MRO Architecture


Join the Intelligent Enterprise initiative

The study work conducted led me to establishing an Intelligent Enterprise Customer Initiative free of charge, for industry leading Energy & Natural Resources customers to advance the thinking and accelerate the maturation of SAP solutions. Extending collaboration to the broader community of expertise in the SAP customer base will enhance the solution design and development for specific industries including Oil & Gas, Utilities, Mining, Chemicals and Mill Products.

The current initiative results will lead to significant MRO cost reduction, giving full visibility on spare parts stock availability across the supply chain and predicting stock levels according to maintenance plans and assets insights.  All using latest SAP Leonardo Technologies such as IoT, Machine Learning and Digital Twins built on SAP Cloud Platform.

Join the initiative free of charge by taking a pic. or using this link

Read more about the announcement here

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