Abstract
An evaluation of the inventory policy at an offshore vessel company was conducted. Currently the items in inventory are used at random intervals as they are used only when parts fail. To solve the problem of reducing a very large inventory but keep enough to allow an uninterrupted service to the customer, we propose a real and economically efficient multicriteria inventory policy using inventory classification method integrated with a preventive maintenance program. The proposed method can be summarized in the following three steps: first, rank the parts according to both the lead time from supplier and the cost of downtime failure and use a matrix display to show the most critical items. In the second step develop a preventive maintenance program for the most critical parts to minimize downtime due to failure. Finally in the third step standardize most critical parts to reduce the inventory which saves the company money while maintaining the same level of service to its customers. Our study showed that the company with a very large inventory could effectively reduce its size by focusing on key parts.
Highlights
Due to the increasing pressure for remaining competitive in the global market place, inventory management has become a major challenge for companies to reduce costs and to improve customer service.Most manufacturing and service companies large or small have some type of inventory
With over two hundred employees and more than thirty vessels, the company carries a large inventory of spare parts evaluated to be worth over 3.5 million dollars without any formal inventory management policy
To solve the problem of reducing a very large inventory but keep enough to allow an uninterrupted service to the customer, we propose an inventory policy using inventory classification method with a preventive maintenance program
Summary
Due to the increasing pressure for remaining competitive in the global market place, inventory management has become a major challenge for companies to reduce costs and to improve customer service. With over two hundred employees and more than thirty vessels, the company carries a large inventory of spare parts evaluated to be worth over 3.5 million dollars without any formal inventory management policy. To solve the problem of reducing a very large inventory but keep enough to allow an uninterrupted service to the customer, we propose an inventory policy using inventory classification method with a preventive maintenance program. Our first step is to rank the parts in the inventory This ranking system will not be one dimensional but rather two dimensional factoring in the expected lead time to receive an item and the cost of downtime that would result in not having the item in inventory. Taking the three steps and applying them together into an inventory policy has created a more predictable environment which saves the company money in inventory while maintaining the same level of service to its customers
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