Material shortage management: running a factory when the kit is incomplete

The shortage list belongs to production, not to purchasing

A useful shortage list is ordered by the build it blocks, not by the buyer who owns the part. It shows the works order at risk, the date it was meant to start, the missing item, the confirmed recovery and the last time anyone actually spoke to the supplier. Lists that show open purchase order lines sorted by supplier tell you who to chase but never what to build. Review it standing up, daily, with planning, purchasing and the line supervisor present, and close items only when a shipment is confirmed rather than when a promise is given.

Clear-to-build and the temptation to start anyway

The clear-to-build check asks whether every component for a works order is physically available before the order is released. Releasing without it feels productive and is usually the more expensive choice: partly built assemblies occupy floor space, block fixtures, accumulate handling damage and eventually get taken apart to feed a more urgent job. De-kitting destroys traceability, generates its own defects and hides real inventory. Where partial build genuinely helps, define which stages may proceed and where the assembly must stop, mark it clearly, and record it so it does not travel forward as complete.

What actually makes a supplier move your order forward

Escalation by email volume changes nothing. What moves a schedule is knowing where your order sits in the supplier's own constraint. Ask what is missing at their end: material, capacity, a sub-tier, or simply sequencing. If it is sequencing, a specific request for a partial shipment of the quantity that unblocks one works order often succeeds where a demand for the full order fails. If it is their material, offer to supply or to accept an alternative grade. Turning up in person, paying an old invoice, or offering a firm forward commitment all carry more weight than urgency alone.

Substitution and deviation when there is no time

Under pressure, someone will propose a similar part from stock. That decision belongs to engineering and quality, not to the person holding the shortage list. A written deviation should state exactly which characteristic differs, which works orders and serial numbers it applies to, how long it is valid, and who authorised it. Regulated and safety-related products may require customer notification or approval before the substitute is fitted. The failure that hurts most is not the substitution itself but the absence of a record, discovered later when a field problem needs the affected units identified and nobody can list them.

Deciding which customer order goes short

When the shortage cannot be recovered, allocation becomes the decision. Doing it by whoever shouts loudest is common and expensive. Set the rule in advance: contractual penalty exposure, the customer's own line-stop risk, downstream value at stake, and whether a partial shipment is useful to them. Involve sales early enough that the customer hears it from an account manager rather than from a missed delivery. Record the decision and its rationale, because the same customers will remember, and a pattern of quietly deprioritising the same account eventually surfaces during a contract renewal.

Frequently asked questions

Should we pay a premium to air-freight a shortage part?

Compare it against what the stoppage actually costs, which is rarely just the delayed revenue. Add idle labour that cannot be redeployed, the disruption of resequencing, the customer penalty exposure and the cost of building around the gap. Against a line stoppage on a high-value assembly, expedited freight is often trivially worth it. Against a low-value part on a job that can simply be resequenced, it is not. Make the comparison explicitly rather than defaulting to either answer, and record it so the pattern can be reviewed.

How do we stop the same parts appearing on the shortage list every month?

Treat repeat offenders as a separate problem from daily firefighting. Pull the list over a period and rank items by how often they block a build. The repeat causes are usually a small set: a supplier whose stated capability does not match reality, a part with a long replenishment cycle and volatile demand, a specification that only one shop can meet, or a bill of materials that does not match what the line actually consumes. Each has a different fix, and none of them is more expediting.

Who should authorise building an assembly with a known missing component?

Production and quality jointly, under a written rule rather than case-by-case judgement. The rule should define which components may be fitted later, which stages must not be passed, how the incomplete unit is physically identified and where it is held, and who closes it out when the part arrives. Without that, incomplete assemblies drift downstream, get counted as finished stock and occasionally reach a customer. The authorisation is less about permission than about ensuring someone owns the completion.