Using risk to manage assets is a key principle of asset management. The same also applies to how an organisation manages its critical spare inventories.
We have developed a simple risk based AM tool to help with this.
The prime reason for holding spares is the cost of being caught without a spare when it is needed. And yet, in 95% of all spares holding decisions this cost is not considered.
The factors that need to be taken into account to calculate spares holding are:
- The cost of being caught without a spare, and needing it.
- The cost of the spare.
- The number of machines (or assets) in use.
- How often we are likely to need the spare.
- The cost of money tied up in purchasing and holding the spare.
- How long it takes to get a spare – the ‘leadtime’.
- How much longer we intend to keep this plant in operation.
If some of the failures are repairable:
- What proportions are repairable.
- How long it takes to repair.
One other factor often arises – can a premium be paid to get spares delivered more quickly.
In this situation there are two more factors:
- How much quicker.
- How much more it costs.
The above eleven factors probably cover more than 90% of all spares requirements.
Our Riskspare™ analysis tool will use these inputs to help arrive at financial decision on whether you need to hold spares and if so what is the optimum amount required.