To help you plan for a seamless integration of your materials management processes, we have shared 5 key factors to consider during mergers and acquisitions<\/a>, as well as how ABL can help materials teams navigate these changes\u2026<\/p>\n\n\n\n \u201cWhen it comes to mergers and acquisitions, one of the biggest priorities for both maintenance and materials teams is managing the status of the data – particularly if the two companies involved are having to migrate data from one CMMS program to another. <\/p>\n\n\n\n \u201cMaximo and SAP are the two most common CMMS programs, however, they are quite different to each other; Maximo material numbers are only six digits while SAP\u2019s are eight. SAP allows a short description of 40 characters, while Maximo allows a short description of 250 characters. When merging the data from two systems into one, the data needs to be aligned to fit with the preferred system, and this can be incredibly time consuming. <\/p>\n\n\n\n \u201cThe biggest risk when merging the data from two CMMS\u2019 is duplication in your system, as this can result in the following three issues when it comes to materials management:<\/p>\n\n\n\n How we can help:<\/em><\/p>\n\n\n\n \u201cAt ABL, we can provide a vital link between the materials teams and data teams during this process. Firstly, we can store all data and check it before moving it into the preferred CMMS software, identifying any duplicate records or investigating further if required.<\/p>\n\n\n\n \u201cOne of the first ways that we would do this is remove any spaces, dashes, dots and hyphens from the part number so all you have is a string of numbers and letters. Different people will input a part number in a slightly different way, so by stripping it back we can easily identify any matching records, examine the description of them all and if they are about 80% the same, it can be marked as a duplicate or we can investigate a little bit more to know for certain.<\/p>\n\n\n\n \u201cIt sounds simple, but if this stage was going to take a client four months to do, we’d have just halved that in a matter of hours. When we worked with our client Cenovus on its acquisition of Husky, we approached the data management in 3 key phases: <\/p>\n\n\n\n \u201cFrom a supply chain perspective, a huge consideration during a merger or acquisition would be around the purchasing of stock and how that process can be optimised. Although this process is largely managed by the supply chain team or the procurement division, it\u2019s still a fundamental part of what materials teams need to be aware of and involved in. <\/p>\n\n\n\n \u201cCommon questions would include: <\/p>\n\n\n\n \u201cFor some mergers and acquisitions, there might also be some logistical considerations to make with stock purchasing. For example, if the company headquarters move to a different region or country then contracts may need to be completed or managed differently. <\/p>\n\n\n\n \u201cAll of this needs to be thought about carefully, because if you order a part and think you have a lead time of two weeks, but a contract hasn\u2019t been set up with the supplier, then there is going to be a delay with that purchase. Those two weeks could really quickly become two months and that will cause massive implications and risks if the part is for a safety critical piece of equipment.\u201d<\/p>\n\n\n\n How we can help:<\/em><\/p>\n\n\n\n \u201cOne of the things we do to help our clients is review the minimum\/maximum establishment numbers on their equipment. This involves identifying the maximum and minimum amount of stock<\/a> they should hold for each part and setting up an efficient reorder system. For instance, if there\u2019s a minimum of two and a maximum of four, the system should automatically reorder to take the client back up to four items in their inventory when their stock level reaches two. <\/p>\n\n\n\n \u201cWhat we see in a lot of cases is that materials teams don’t have the system set up at all, or they have a minimum level of zero which is too low. On the other hand, they may have a minimum\/maximum level of 10 and 14 when the probability of failure for that item is perhaps every six months, for instance, and the lead time for getting a new part is two weeks. Through our analysis we can identify these inefficiencies and create a system that works well for the client depending on a variety of factors.<\/p>\n\n\n\n \u201cDepending on the locality of the facilities, a company may actually be cheaper building a new centralized warehouse hub which consolidates all spare parts of equipment, rather than each facility having its own warehouse. This would significantly reduce the amount of stock on each of the different sites, leading to reduced capital expenditure on unnecessary spare parts and storage.\u201d<\/p>\n\n\n\n \u201cAs a materials manager, you want to make sure the bill of materials is in line with all the maintenance activities and capabilities when two companies merge. It\u2019s all about making sure you identify the right spares to mitigate the chance of a bottleneck, or having to employ loads of extra people to manage your bill of materials when in actual fact, you don’t even need a lot of it.<\/p>\n\n\n\n \u201cIt\u2019s important that every engineer has all the parts they need, however, they quite often want to have everything<\/em> to hand even though they don\u2019t necessarily need it. OEMs can also often provide recommendations that are not required, misleading companies into thinking they need to store a lot of spare parts. This can lead to a significant waste in both effort and expenditure.\u201d<\/p>\n\n\n\n How we can help:<\/em><\/p>\n\n\n\n \u201cAt ABL, we can optimise the client’s inventory management system and help them to look at the bigger picture of where we can help them. We’ll work closely with engineering teams to create the bill of materials and make sure it contains what they really<\/em> need, not just what they want or what their vendor is trying to upsell to them.<\/p>\n\n\n\n \u201cThrough our experience and the data analysis we conduct for clients, we can work with them to make sure everything on the bill of material and the data in their system is relevant to their maintenance capabilities. Our focus will be on critical equipment first, to make sure those spares are identified, or highlight any criticality levels that we think need to be altered.<\/p>\n\n\n\n1. Data management<\/h2>\n\n\n\n
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<\/figure>\n\n\n\n2. Purchasing and optimising stock<\/h2>\n\n\n\n
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3. Bill of materials<\/h2>\n\n\n\n
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