Procurement

Tampa Boosts Productivity by Outsourcing Parts

June 27, 2017

Pictured are Carlos Hicks, Tampa technician, and Porfirio Toro, MANCON parts specialist. Photo courtesy of MANCON
Pictured are Carlos Hicks, Tampa technician, and Porfirio Toro, MANCON parts specialist. Photo courtesy of MANCON

Since the City of Tampa, Fla., began outsourcing its parts room in 2015, the fleet has been able to improve technician productivity, improve parts availability, and streamline its procurement processes, according to MANCON LLC.

Before contracting with an on-site parts inventory management service provider, the Tampa fleet was faced with a challenge familiar to that of many public fleets — not having the right parts and supplies to support maintenance. The lack of timely parts receipt adversely affected Tampa technicians’ ability to turn vehicles around, which was a source of frustration for its customers.

“City purchasing did their best to maintain parts contract coverage for our fleet, but because of our wide variety of equipment and the unpredictability of parts needed ‘on demand’ for certain vehicle types, this was a nearly impossible task,” recalled Connie White-Arnold, Tampa’s fleet manager.

Tampa fleet’s parts room was managed by an external division and fleet staff relied on city purchasing to procure parts. When the procurement process couldn’t be responsive enough to provide parts required for repairs which were on a tight timeline, Tampa technicians would use purchase cards to buy parts that they needed. 

“Inventory management just wasn’t a core competency for us, and my technicians spent too much time sourcing, buying, and in some instances, picking up parts from local vendors, plus we were burdened with time-consuming purchase card reconciliation,” White-Arnold said.

This decreased technician productivity, increased overtime requirements, and service to the fleet’s internal customers suffered.

Tampa’s director of purchasing, Greg Spearman, championed the effort to contract out the parts room. He saw the potential benefits of a contractor-operated parts store, including a reduction in the number of bids, purchase orders, and invoices; an increase in on-demand inventory; elimination of over/understocked parts; and improvement in parts availability and timeliness of fleet repairs.

The city awarded MANCON with a competitively solicited contract on Dec. 18, 2014. The five-year contract is approved for a cumulative expenditure of $19.5 million, and the city has five one-year renewal options. The company purchased the city’s remaining inventory at the last receipt price and issues the same inventory to technicians at the same price. Six parts room employees were assigned to other duties within the city.

By Jan. 5, 2015, MANCON was open for business operating Tampa fleet’s parts storerooms. 

“The storeroom inventories are tailored to the items that our technicians are using and many more parts are stocked. Plus we receive non-stocked items very quickly from local suppliers,” noted White-Arnold.

With Tampa technicians fully dedicated to vehicle and equipment repair instead of chasing parts, White-Arnold saw immediate improvement. 

“My technicians are able to spend more time doing what they enjoy — repairing down vehicles and equipment. Because productivity increased, we were able to implement a more robust preventive maintenance program, which is paying dividends in reduced cost of ownership,” said White-Arnold. 

Comments

  1. 1. MC [ June 29, 2017 @ 05:05AM ]

    So the problem wasn't with the city's parts departments, it was too much government red tape preventing the parts departments from doing their jobs effectively. It's impossible to run a shop efficiently when you need to get bids on everything and approvals from someone off-site.
    Instead of outsourcing, the same thing could have been accomplished by cutting bureaucratic red tape and hiring a competent inventory manager. With several sites, they could have shared inventory between them allowing the procurement of lesser-used items while still keeping the overhead at acceptable levels. Also, instead of sending techs to go after their parts, the parts department should have a runner to do it - allowing the techs to work on something else while waiting on the part to arrive.
    Unfortunately, in far too many shops, the parts department is seen a the black sheep of the company. Usually understaffed, underpaid, under-motivated, and under-trained, with their hands tied by low overhead targets, a limited supplier pool, are managed by people with little or no experience in the field, and piles of bureaucratic nonsense. No one sees the importance of the parts department until problems arise, and instead of fixing the roots of the problems, people just start losing their jobs - only to begin the cycle again with new faces.

 

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