MRO inventory: A balancing act
September 1st 2011

Armac Systems in Drogheda,Co Louth, has signed a major capability enhancement agreement with SR Technics of Zurich, one of the world's leading independent provides of technical services for the civil aviation sector.Worth €2m over 24 months, the agreement confirms the company's reputation as a key player in aircraft MRO (maintenance, repair and overhaul) inventory optimisation

Aprovider of technical service to airlines, SR Technics provides support to a global customer base with approximately 700 Airbus and Boeing aircraft. Where it has been applied to date, Armac's MRO solution has delivered 25% reductions in inventory investment for SR Technics.

Optimising MRO inventory Armac's MRO inventory optimisation solution helps organisations to reduce their inventory investment without sacrificing service levels. It combines data from an organisation's ERP (enterprise resource planning) systems with the knowledge of inventory planners and uses its proprietary algorithms to provide purchasing decisions to planners. SR Technics uses the solution both for inventory management and as presales support.

A recent licence upgrade makes provision for SR Technics to further deploy Armac's RIOsys software as needed across other aerospace business units of the Mubadala Development Company, the Abu-Dhabi based owner of SR Technics.

With a global network of inventory depots in EMEA, Australia and America, SR Technics has created a 'superinventory' pool, ensuring optimal spares availability for its customers. Armac's solution is a critical enabler which allows SR Technics to manage its global inventory without over-investing or sacrificing service levels.

Brian Gillett, vice president, supply chain development for SR Technics Switzerland, says: "We have to have enough inventory to ensure we can meet customer demand, but not overinvest. It's always a fine line." With its history of best practice in inventory planning for aircraft maintenance, SR Technics is now looking to enhance its capabilities on a global basis.

"We are looking to 'in-source' Armac's knowledge and experience to fully leverage our current use of the solution and recent upgrade. The expertise and leadership demonstrated by Armac has left no doubt that they are the right partner for us in supporting us and enhancing our expertise in inventory optimisation," said Gillett.

Delivering accountability Commenting on the announcement,Micheál Armstrong, CEO of Armac Systems said: "This is an exciting project for our company - we believe it will set the benchmark for other MROs and organisations with similar challenges to look outside their existing processes, and see that they don't have to continue to overspend on high value inventory to deliver service levels." "We are finding that more and more organisations are recognising that when it comes to inventory optimisation, their ERP and materials IT systems are missing quite a vital capability: to plan purchasing decisions for maintenance inventory in an optimal way, especially where the environment is complex and the demand is uncertain. Our solution not only enables reductions in inventory investment and increases in service levels, it allows the organisation to improve accountability around provisioning decision making and achieve visibility and greater management control."

Significant contract Welcoming the announcement, Greg Treston, head of High Potential Start Ups and Scaling at Enterprise Ireland said: "Enterprise Ireland has worked closely with Armac Systems and this announcement is one that we greatly welcome. This is a highly significant contract for Armac and signals a major achievement for them in building their international market presence. They are a highly innovative company with the products, services and business development strategy that enables them to carve out their own place in global markets, driving jobs and export sales growth at home. We wish them every continued success."