Development Of Risk Based Approach To Spare Part Inventory Management For Sugar Factories: A Case Study Of Chemelil Sugar Company

Abstract

Risk-based approach in spare part inventory management and plant maintenance is essential for ensuring asset integrity in a process facility. The sugar industry in Kenya has been a victim of inefficient spare part inventory management resulting to unscheduled factory stoppages, factory breakdowns, obsolescence of plant and equipment whose maintenance costs are very high. This has been compounded by high maintenance costs and expensive spares which are also difficult to find and procure. In this regard the purpose of the current study was to develop a risk based approach to spare part inventory management in order to improve the performance of the sugar factories. In order to achieve the objective the study employed a convergent parallel mixed method research design. This study targeted spare parts inventory records and plant maintenance records inventoried for the past one year in Chemelil Sugar Company. Document analysis as the main tools for collecting secondary data was used. Data was analyzed by use of descriptive statistics using Excel. From the Pareto analysis of boiler, pre mills, mills and juice treatment it was established that they had a downtime of 315.51 hrs, 294.19 hrs, 111.13hrs and 82.3 hrs respectively. Besides that, spare parts failure frequency ranging from 2 to 756 times a year was also used to identify spare part risk. Critical spare parts were the motors, water pump and the gears with a criticality index ranging between 8 to 25 based on downtime, lead time and availability in the market. The study established reorder points (24, 16, 75), Lead time demand (13,4,30) and Safety stock (12,13,45) for motors, water pump and the gears respectively to determine the risk mitigation strategies for the critical spare parts for Chemelil sugar factory. In conclusion the factory should evaluate their spare parts inventory critically owing to their effect on the downtime and implementation of risk based approach to spare part inventory management. The findings of this study widens interest in the use of Risk based approach to a number of other stakeholders including operators, maintenance personnel, regulators and insurance companies, and other industries to potentiate plant availability.