Inventory Management Strategy: Malaysia Airlines 1989‐1993

The management of materials to support aircraft maintenance is studied. In a situation where the safety stock is determined using a rule of thumb that does not differentiate the demand variation,the problem of low service level of expendables cannot be solved unless this rule is changed. A new guide for safety stock, taking demand pattern into consideration, is introduced. In addition, more reordering of low cost items is automated to ease slightly the high manpower utilisation, and put more effort where it counts most – monitoring and expediting high cost items. Other problems are related to loss and repair cost of the repairable items.