Inventory hoarders: storage or junk?
In almost every facility on earth (and I don’t think I am exaggerating) there is a place in which equipment and spare parts are kept that someone thinks is important to keep but not part of any system of control.
These are not just the “squirrel” stores people might keep, but often are company-sanctioned areas for keeping these items.
In a plant I joined as a young engineer, this place was out the back of the factory, far from scrutiny, in a place only the occasional warehouse visitor found if they took a wrong turn. This was a landscape of brown rust, a weed-covered paddock that was in effect a graveyard for plant equipment. By any reasonable analysis, this equipment was junk.
Yet there were people on site who thought that this was a valid means of storage and even referred to this junk as inventory. That was more than two decades ago, but with all of the technological progress in the intervening years, it seems nothing much has changed in this area of spare parts management. It seems almost every site I visit has this type of so-called storage. It may not be open to the weather, but is almost always hidden, and that really means it is not inventory, it is hoarding.
If we think of storage as the act of keeping goods (in this case spare parts and equipment) for future use, then the key differentiators that take this behavior to the level of hoarding is:
1. The supply is largely hidden from authorities — usually for fear it will be exposed for what it is. Being hidden doesn’t just mean physically hidden by being out of sight and out of mind, but also financially hidden by being largely off the books. In this case, the authorities are senior management and finance.
2. There is no means of control. That means there are no criteria for deciding what should or should not be kept, no mechanism for deciding the quantity to hold, no review process to ensure obsolete or non-functional items are removed.
In short, the items kept in the “rear yard” are uncontrolled junk.
I hear many people say it does no harm (as long as you keep down the rats). But is that really true?
Everything we do in our work, all of our behaviors, the things we make important and the things we ignore, help create the culture of the workplace. Many companies say spare-parts management and control is important, but very few really live it. Very few ensure all parts are controlled in their purchase, storage and use. In the plant I joined 25 years ago, we cleared out that junk, took control of our spares and drove the plant to new heights of performance.
So if you think hoarding broken old rusty parts is going to be good for your plant because you might just need some part one day, you are kidding yourself. All you are doing is setting a bad example of how to manage this critical element of your operational support and setting your plant up for failure.