Maintenance, Repair, and Operations (MRO) is the full scope of activities, materials, and supplies required to maintain industrial equipment and facilities in operating condition. MRO encompasses everything that keeps production running but does not become part of the finished product — lubricants, spare parts, tools, consumables, safety equipment, and the labor and processes that deploy them.
In asset-intensive industries, MRO represents a significant and often poorly controlled cost center. Studies consistently place MRO spend at 5 to 10 percent of total operating costs in manufacturing and process industries. The challenge is not just the cost — it is the visibility. Unlike direct materials, MRO purchasing is often decentralized, inconsistently tracked, and managed reactively, making it difficult to control or optimize without deliberate process design.
Why MRO Management Matters
Uncontrolled MRO creates problems on two ends of the spectrum. Too little inventory — wrong parts, understocked critical spares, slow procurement — extends equipment downtime when failures occur. Too much inventory — overstocked slow-moving items, duplicate purchases across sites, obsolete parts — ties up working capital and creates storage and waste costs.
The operational consequence of poor MRO management is most visible during unplanned failures. When a critical bearing fails and the replacement is not in stock, the downtime clock runs while procurement scrambles. That waiting time — sometimes hours, sometimes days — is entirely preventable with a well-managed MRO inventory aligned to equipment criticality and failure history.
Effective MRO management also supports maintenance planning. A planned work order that arrives at execution with all required parts staged and kitted takes significantly less time to complete than one where technicians spend the first hour sourcing materials. Wrench time — the percentage of a technician’s day spent actually performing maintenance work — improves directly when MRO processes are reliable.
How MRO Management Works in Practice
Inventory Classification and Criticality Alignment
Not all MRO inventory warrants the same stocking strategy. Critical spare parts for high-consequence assets — components with long lead times, single-source suppliers, or high failure impact — require safety stock levels that guarantee availability. Routine consumables with short lead times and multiple suppliers can be managed on lean or just-in-time principles. Asset Criticality Ranking (ACR) should directly inform MRO stocking decisions — if an asset is Tier 1 critical, its key failure components need to be on the shelf.
Procurement and Sourcing
MRO procurement differs from direct materials purchasing in several important ways. MRO items are purchased in smaller quantities, from a larger number of suppliers, with less predictable demand patterns. Best practice is to rationalize the supplier base — consolidating MRO purchasing to fewer, preferred suppliers reduces transaction costs, improves pricing leverage, and simplifies invoice management. Vendor-managed inventory (VMI) agreements with key suppliers transfer stocking responsibility and reduce internal management burden for high-velocity items.
Inventory Control and Tracking
MRO inventory that is not tracked is inventory that gets lost, duplicated, or consumed without accountability. A CMMS manages MRO inventory by linking parts to work orders, tracking consumption against assets, recording stock levels, and generating replenishment triggers at defined reorder points. Without this integration, MRO purchasing is reactive — driven by emergency requests rather than planned demand.
Planning and Parts Kitting
For planned maintenance work, MRO management includes pre-staging and kitting parts before work orders are executed. A planner reviews upcoming PM work orders, identifies required materials, pulls them from stores, and kits them for the assigned technician. This eliminates parts-hunting time at execution and ensures that planned windows are used for actual maintenance work rather than material sourcing.
MRO by Industry
Manufacturing: High-volume production environments manage MRO across a wide range of equipment types — motors, drives, pumps, conveyors, presses — with significant variation in parts criticality and consumption rates. Manufacturing MRO programs typically focus on reducing stockouts for high-turn items and eliminating excess inventory for slow-moving parts. Centralized stores with controlled access and CMMS integration are standard in mature manufacturing operations.
Mining: Remote mine sites face unique MRO challenges: long supply chains, limited local sourcing options, and extreme consequences for stockouts on critical components. Haul truck tires, crusher wear parts, conveyor belts, and drivetrain components must be stocked on-site because emergency procurement from remote locations can extend downtime by days. MRO inventory investment in mining is proportionally higher than in most industries because the cost of stockouts is proportionally higher.
Oil and Gas: Upstream and midstream operations manage MRO across geographically dispersed assets — wellheads, compressor stations, pipeline infrastructure — often with small on-site crews. Standardization of equipment across sites is a key MRO strategy in oil and gas: when all compressors at a given operator run the same model, spare parts are interchangeable, stocking requirements consolidate, and technicians develop deeper component-level expertise.
Crane and Rigging: MRO for crane operations includes wire rope, sheaves, hooks, hydraulic components, and load-bearing hardware — many of which have mandatory replacement intervals defined by regulation regardless of apparent condition. MRO planning in crane operations must account for both condition-based replacement and regulatory replacement schedules, with documentation requirements that make parts traceability a compliance function as much as an inventory function.
Common MRO Program Failures
No linkage between asset criticality and stocking levels: MRO inventory built from historical purchasing patterns rather than criticality analysis will always have too much of the wrong parts and too little of the right ones. Stocking decisions should start with failure consequence, not order history.
Decentralized purchasing without visibility: When individual technicians or supervisors can purchase MRO materials outside of a controlled process, duplicate orders accumulate, preferred supplier agreements are bypassed, and actual spend becomes impossible to track. Centralizing MRO purchasing through a single system — even a simple one — eliminates most of this waste.
No reorder point management: MRO stores that are replenished by walking through the shelves and ordering what looks low are managed by observation, not by data. Reorder points set in the CMMS based on consumption rates and lead times automate replenishment and prevent stockouts without requiring manual monitoring.
Parts not linked to assets or work orders: MRO parts that are issued from stores without being tied to a specific asset or work order produce no reliability data. When a bearing is replaced and the work order records the labor but not the part number, the maintenance history is incomplete and failure pattern analysis is impossible.
Hoarding and shadow stores: Technicians who have been burned by stockouts often cache their own supply of commonly needed parts — in their toolboxes, under benches, in unlocked cabinets. This creates invisible inventory, undermines centralized stock counts, and makes MRO optimization impossible. Reliable central stores eliminate the motivation for hoarding.
MRO vs. Related Concepts
- MRO inventory: The physical parts, consumables, and materials held in stores to support maintenance and operations work.
- Direct materials: Raw materials and components that become part of the finished product. Managed through production planning systems, not CMMS. MRO and direct materials require separate inventory management approaches.
- Spare parts management: A subset of MRO focused specifically on equipment components held for replacement when failures or PM tasks require them. See: Asset Hierarchy.
- Vendor-managed inventory (VMI): An arrangement where a supplier monitors and replenishes MRO stock at the customer’s facility, reducing internal procurement workload for high-velocity items.
- Total Cost of Ownership (TCO): MRO costs are a significant component of TCO for industrial assets. See: Total Cost of Ownership (TCO).
Frequently Asked Questions
What does MRO stand for?
MRO stands for Maintenance, Repair, and Operations. It refers to the activities, materials, and supplies required to maintain industrial equipment and facilities — everything that supports production without becoming part of the finished product. In practice, MRO encompasses spare parts, lubricants, tools, consumables, safety equipment, and the processes used to procure, store, and deploy them.
How do you reduce MRO costs?
MRO cost reduction starts with visibility — you cannot manage what you cannot see. Centralizing purchasing through a CMMS, linking parts consumption to assets and work orders, and setting reorder points based on actual demand data are the foundational steps. Beyond that, supplier rationalization (fewer suppliers, better pricing), criticality-based stocking (right parts at right levels), and eliminating duplicate inventory across sites typically yield the largest savings. Organizations that move from reactive MRO purchasing to planned procurement consistently report 15 to 25 percent reductions in MRO spend.
How does a CMMS manage MRO inventory?
A CMMS manages MRO inventory by linking parts to assets and work orders, tracking stock levels in real time, setting reorder points that trigger automated replenishment requests, and recording consumption history against specific assets. This creates a closed loop: a work order is created, parts are pulled from stores and linked to the order, consumption is recorded, and stock levels update automatically. Over time, this data builds a consumption history that informs stocking decisions and failure pattern analysis.
What is the difference between MRO and direct materials?
Direct materials are raw materials and components that become part of the finished product — they are planned and purchased based on production schedules. MRO materials support the equipment and facilities that produce the product but do not appear in the end product themselves. The distinction matters for procurement, accounting, and inventory management: direct materials are managed through production planning systems with predictable demand; MRO demand is less predictable, driven by failure events, PM schedules, and operational needs.
Related Terms
- Asset Criticality Ranking (ACR)
- Total Cost of Ownership (TCO)
- Wrench Time
- Preventive Maintenance (PM)
- Asset Hierarchy
- Mean Time Between Failures (MTBF)
- Deferred Maintenance
Manage MRO Inventory With Redlist
Redlist connects MRO inventory directly to work orders, assets, and maintenance planning — giving your team the parts visibility needed to execute planned work on schedule and eliminate downtime caused by missing materials.
