The most important measure of success in MRO purchasing is customer satisfaction. If MRO (maintenance, repair and operations) purchasing's internal customers, most often plant managers or maintenance engineers, are not happy with a product or supplier selected by the sourcing team, they will buy another item or go to another supplier to get the job done. And purchasing's strategy will fail miserably.

The plant manager's job is to keep production lines running and get goods manufactured by the company out the door and to the customer on time, and MRO items such as electrical supplies, fasteners, power transmission products, PVF (pipes, valves and fittings), general industrial supplies and safety supplies help meet that goal. If the plant manager has P&L (profit and loss) responsibility, then cost is a concern, but most often it's on-time delivery of MRO items that's top priority.

As Steve DeFord sees it, purchasing is a service that exists for its customers. In his case, as MRO commodity manager at Rockwell Collins in Cedar Rapids, Iowa, the customer is the manufacturing and facilities operations. "If we are not talking their language, then it makes it very difficult for us to understand what they really need," he says.

At Rockwell Collins, the enterprise sourcing operation leads commodity teams that consist of end users; the teams meet monthly. DeFord, an industrial engineer who worked in production at the company before making a move to sourcing, says the meetings provide opportunity "to take a pulse of what our customers are thinking, and learn whether the solutions we put in place are working for them." In his role now, DeFord's office is a mere 25 steps from the production floor.

Enterprise sourcing is implementing e-catalogs for its internal customers to use when ordering MRO items, and suppliers come to the company's facilities to meet quarterly with commodity teams about the effort. These meetings too provide invaluable feedback.

At the top of the list of needs for the manufacturing and facilities operations is product availability, says DeFord. "Many people tend to think of MRO as being relatively insignificant until the time an MRO item keeps us from making a critical shipment," he says. "If a soldering iron, or the tips that go along with it, is not doing the job properly, it could cost hours of delay or rework and cause us to miss shipments for the month."

One way the enterprise sourcing operation is helping its customers get the items they need in short order is through the e-catalogs. "It's our job to put in place the best tools, pricing, availability and then get out of their way so they can get the items they need quickly," DeFord says. Rockwell Collins uses software from SAP to streamline its MRO buying.

DeFord says there are not many terms or language that could get lost in translation during conversations between purchasing and manufacturing, but the two groups often have different priorities, so clear communication is of utmost importance. While total cost of ownership (TCO) is always a major concern of his, DeFord says when meeting with colleagues in plant management and facilities, he emphasizes availability, ease of use, safety stock and ergonomics. "When we talk about TCO, their eyes tend to glass over," he says. "They are most concerned with getting the item quickly and whether it works for them in the application."

“Many people tend to think of MRO as being relatively insignificant until the time an MRO item keeps us from making a critical shipment.” —Steve DeFord, Rockwell Collins

Our job in purchasing for MRO is not sitting behind a desk. Get to know the engineers. Understand the products they use.” —Randy clark, Volvo group

"That's exciting for someone in purchasing because now we are part of their process," he says. In his role, Clark, a member of Purchasing's All-Star MRO Buy team for 2006, has responsibility for sourcing MRO goods and services for seven plants in North America.

Other concerns of plant managers at Volvo are related to tracking of MRO items including spare parts for machinery used to produce the company's trucks and product warranties and meeting environmental regulations. "For instance, in the case of used cutting tool fluid, or wooden pallets, they turn to purchasing for help finding ways to dispose, recycle or sell it."

Clark tries to meet at least twice a week with his colleagues at the plants, and is in each of the seven locations every month. He spends time on the factory floor at the company's facilities in Europe another four to six times a year.

"I am in plant meetings every chance I get," he says. "And when I have something specific to talk about and ask for time on their agendas, I've never been refused." Also, purchasing's internal customers are involved in the strategic sourcing process and are represented on spend teams.

Like DeFord, Clark doesn't see a "language barrier" between purchasing and plant engineering and facilities and maintenance personnel at Volvo, but recognizes the value of clear communication. Terms that may crop up in conversations include "spot buy," "emergency buy" and "part-number buy."

His advice on how to successfully implement an MRO contract: "Get on the plant floor. Our job in purchasing for MRO is not sitting behind a desk. Get to know the engineers, the shift guys. Understand the products they use, whether it's safety products, greases, oils and lubes, or mop buckets."

Clark says heeding this advice may prove useful in negotiations with suppliers. "We can't agree to something just because it looks good on paper. We have to be familiar with the product and how it works."