Maintenance and Repair Operations (MRO)

Outsourced MRO Service Delivery : Managed (or outsourced) MRO means using another company to provide the services for you.  There are different options available for outsourcing services.

1. Preventive maintenance. Also known as PM, where regularly scheduled maintenance is applied to the manufacturing estate.
2. Corrective maintenance. Where equipment is repaired or replaced after wear, malfunction or break down.
3. Predictive maintenance. This uses sensor data to monitor systems, then continuously evaluates it against historical trends to predict failure before it occurs.

In terms of the supplier delivery model, there are considerations to the degree you outsource the maintenance operations. These can include:

1. Individual managed MRO service outsourcing. In this you would have one provider operating a single service. This can combine with many service operators or to supplement existing in-house service operation.
2. Primed multi-service. This is where one company provides multiple, but not all, MRO services. This might supplement existing in-house MRO services.
3. Total MRO Management (TMROM). This is where you would outsource all of your MRO services to a prime contractor – which in turn may have sub-contractors. A clear articulation of the objectives for the total services is key to preventing misunderstandings and disputes later down the line.

Many challenges often arise in MRO relationships, including:

• There are often high volumes of small sub-contractors that the prime contractor finds challenging to assure compliance of
• A lack of quick visibility over health and safety compliance levels
• Misaligned KPIs that reflect only transactional service elements, as opposed to the wellbeing of the individuals in the working environment
• Significant disputes over performance incentives and penalties
• Risk assessments from the supplier(s) are often not accurate
• Suppliers can have poor health and safety policies
• Sub-contractors can sometimes not follow health and safety procedures and, prime contractors occasionally do not monitor this
• A lack of due diligence from the prime contractor to sub-contractors to determine health and safety breaches leading to impending enforcement notices and prosecutions
• Poor overall governance of the relationships between prime contractor, sub-contractors and end client.

When outsourced Maintenance, Repair and Operations delivery works, it works really well. If you operate in a genuine collaborative manner, with appropriate levels of relationship management, contract management and performance management, you’ll often drive really excellent innovation and drive the costs of BAU service delivery down to its optimum.

Many challenges exist to put in these collaborative and innovation foundations however:

• If done well, you can expect driving a much better return on your investment; sometimes reducing your optimum cost base for BAU services by up to 27%.
• Done badly without key foundations in place, your BAU services will often end up at lower service levels than you have now, and your costs are likely to escalate to be far more expensive than your current operating costs.

Don’t end up in this way. Use our ‘Optimise’ method to generate maximum value and the highest market reputation.