Procurement for maintenance, repair, and operations (MRO) includes everything bought to keep a company operating, including supplies, machines, and instruments used in maintenance and repair. Because this category accounts for a wide variety of items, MRO procurement managers often navigate a fragmented network of suppliers that sell everything from office supplies to maintenance equipment. As a result, pricing, contract terms, and product specifications vary widely, making MRO purchasing difficult for procurement managers.
Fortunately, emerging MRO technologies are revolutionizing procurement and helping organizations improve their MRO spend. By leveraging the cutting-edge solutions we share below, organizations can reduce duplication, increase savings, and improve their MRO procurement strategies.
MRO Technologies That Provide Value for Organizations
Smart tools and technologies can improve the efficiency of MRO procurement. These technologies also cover how organizations collect and create value from their data. Below, we share the most significant developments transforming the MRO industry.
1. Advanced Text Analytics
Because MRO inventory can comprise thousands of items, MRO data sets can be messy, filled with duplicate purchases resulting from product name variations. Organizations can reduce duplicate orders and save money by leveraging advanced text analytics to clean their data sets. This AI-powered MRO technology applies an algorithm to comb through data and categorize related texts to identify duplicate items.
After identifying duplicate transactions, procurement managers can then create standardized categories for each item to consolidate spending. This strategy enables better spending transparency and reduces overall MRO procurement costs.
2. Cloud Technology
Cloud technology enables organizations to store and access data anytime and anywhere. Using cloud-based solutions, procurement teams can view real-time inventory data, improve their spending visibility, and analyze historical utilization patterns. As a result, they can quickly spot consolidation opportunities that increase savings and maximize contract value. Cloud technologies can also streamline collaboration for organizations with multiple locations and remote employees.
3. Inventory Analytics and Forecasting
Inaccurate forecasting of demand in the MRO industry can lead to problems like overstocking and undersupplying. When left to human decision-making, it can be hard to predict the utilization of MRO inventory. Advanced predictive MRO technologies can analyze historical data and run simulations to anticipate future demand more accurately.
In this solution, an analytics engine compares current inventory levels against organizational requirements and recommends optimal stock levels. Better forecasting accuracy helps companies reduce the risk of oversupplying and free up more business capital for other projects.
4. Software Bots
A bot (short for software robot) is a program created to perform tasks that typically involve human interaction. It’s one of the more recent MRO technologies that is increasing in adoption. Bots can be programmed to automate the more repetitive and rule-based aspects of procurement, such as placing purchase orders or verifying invoices. Using bots relieves procurement teams of mundane tasks so they can focus on their core responsibilities.
5. Optical Character Recognition
Optical character recognition (OCR) is an emerging technology that can convert handwritten and printed documents into digital, machine-readable data. This solution can help organizations streamline paper-based processes and manage vendor contracts more effectively in MRO procurement.
Managing multiple suppliers with different vendor contracts is a common challenge procurement managers face. Because these contracts come in different formats, handling them is often manual and laborious. OCR enables procurement teams to digitize vendor contracts and create a comprehensive, searchable database. Thus, procurement managers minimize the time spent on contract management and redirect their efforts to more strategic initiatives.
6. Industrial Internet of Things (IIoT)
IIoT, or the Industrial Internet of things, encompasses all interconnected devices that offer organizations feedback about the performance of their assets. While this technology is more commonly observed in high-stakes industries such as health care and manufacturing, this solution can also be implemented in smaller organizations to eliminate potential supply chain disruptions.
Before smart equipment and sensors could track maintenance needs, maintaining equipment was carried out per manufacturer recommendations, and parts were replaced only when they broke down. Now, smart MRO technologies constantly collect data to let technicians know if their production processes are running optimally.
If an anomaly is detected, the procurement team will be notified to purchase any necessary items or repair tools. Some AI-driven eProcurement solutions feature inventory auto-replenishment when they meet preestablished rules. This solution prevents potential downtime and aids organizations in transitioning from reactive purchases to proactive maintenance solutions.
Streamline MRO Procurement with CenterPoint Group
MRO technologies play a critical role in helping organizations reduce costs, optimize procurement processes, and maximize the value of their vendor contracts. Integrating smart technologies can be the key to overcoming even the most complex challenges of the MRO industry. CenterPoint Group can help you get started.
As a leading group purchase organization, we help businesses leverage modern solutions to streamline their procurement processes. Our unique approach to procurement combines the power of data analytics, technology, and negotiation to drive value and cost savings to our partner organizations. Request a free pricing analysis, or speak to one of our team members today.
