George Krauter

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Barriers to realizing value from TCO for indirect-MRO

There is a change taking place in the world of MRO in that total cost of ownership (TCO) considerations are becoming the focus of supplier selections. Although factors other than price are stated to have value in supplier selection, low price was, and still is, the determinant because it is perceived as measurable. Since market basket processes compare less than 4% of the buy and prices change... More

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Fear of the unknown…a barrier to progress

In this down economy, change is crucial to survival for companies as well as individuals. To resist consideration for change is to court disaster. I recently came to know a situation where it was evident that considerable benefit for plant operations could occur if a change in process was implemented. The proposed change would involve various plant disciplines who would be affected but had... More

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There is no such thing as a dumb question…or is there?

Corporate purchasing at a major company has been charged by management with cutting MRO costs. Through a series of evaluations of cost-cutting opportunities, corporate purchasing determined that the total cost of MRO represented “low hanging fruit” and assigned a cost recovery project to the indirect materials manager. The manager visited each plant to evaluate... More

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In a down economy…Stay pat?

With the current economic downturn, companies are looking for any and all ways to save money, reduce costs and, most of all, conserve cash. An automotive company removed all cell phones from its employees; another laid off its janitorial staff; most have restricted travel and have discontinued non-core events. Is it time to change, or draw in and stay pat? If a company is in the... More

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It’s 2009: Does anyone know where their MRO is?

It continues to amaze me that companies big and small, well-known and obscure, cannot give an accurate figure of what they spend and/or of the value of their MRO inventory. When asked what a company’s MRO spend is, there are estimates that can vary 100%, 200%, 300%. About $1.5 million. No, it’s more like $2.5 million, if we count the pallets and shrink. Wait, the spot... More