Warehouse Management

Planning Operations, Planning, Operations & Control

Never before has it been so critical for the warehouse to work efficiently quickly, efficiently, quickly and error free free.

Centre of Excellence - Supply Chain Management Institute of Logistics

Pressures on Warehouse

Supply Chain Model

Supply Chain Management
Measures and Goals Process Design Customer Response
Customer service policy Customer satisfaction Order entry Order processing Invoicing and collections

Information Systems Organization Design Transportation Warehousing

Inventory Planning and Management

Forecasting

Supply

Make-buy analysis

Network Design

Receiving

Order quantity

Supplier rationalization Supplier integration Supply chain mapping Procurement

Shipment planning Fleet Management Carrier Management Freight Management

Putaway

Fill rate planning Control policy Deployment

Storage Order Picking Shipping

Centre of Excellence - Supply Chain Management Institute of Logistics

Expanded Mission Benefits

z z

Buffer against fluctuating demand

z

i improves product d t availability il bilit high volume, low cost transportation purchase economies JIT systems mass customization E-Commerce distribution

Allows logistics cost trade-offs

z z

Supports innovative supply chain efforts

z z z

Centre of Excellence - Supply Chain Management Institute of Logistics

Warehouse Mission
z

Traditional Functions
z

Value-adding Roles
z

storage location
z z

customization center
z

stockpiling contingency protection consolidation product mixing distribution

assembly cross docking

flexibility center
z

inventory handling
z z

shipping center
z

z z

supply chain coordinator knowledge reservoir marketing tool

Centre of Excellence - Supply Chain Management Institute of Logistics

Expanded Mission Challenges

z z z z z z z z

Smaller, more frequent transactions Greater number of SKUs and customers More value added services More returns More international orders Faster cycle times Less margin for error L Lower skilled kill d employees l working ki with ih greater level of technology

Centre of Excellence - Supply Chain Management Institute of Logistics

Key Warehousing Assets

EQUIPMENT Q

PEOPLE
ASSETS

SPACE

Centre of Excellence - Supply Chain Management Institute of Logistics

Asset #1 - People
z

Critical resource
z

flexible
z z

multiple roles varying schedules trainable variable cost

intelligent
z

economical
z

capable of handling demand surges

Centre of Excellence - Supply Chain Management Institute of Logistics

Asset #2 - Equipment
z

Supportive tools
z

maximizes people productivity

z z

conveyors forklifts

allows effective space utilization

z z z

racking storage bins mezzanines

promotes safety

Centre of Excellence - Supply Chain Management Institute of Logistics

Asset #3 - Space
z

Scarce commodity y
z

most difficult, costly and time consuming to expand cubic capacity must be used effectively aisle space must be minimized dead space must be avoided
Centre of Excellence - Supply Chain Management Institute of Logistics

Facility Strategic Planning

z z

Ownership of facilities
z

Private, public, or contract? Site selection Location Design and layout Configuration and product layout

Facility development
z z z z

Materials handling g selection

z

Automation vs. labour Receiving and shipping

Centre of Excellence - Supply Chain Management Institute of Logistics

Labour operations
z

Ownership - Make vs. Buy?

z

Private
z

owned d or l leased d facilities Rented facilities Partial use variation of public warehousing dedicated resources

Types of public facilities

z z z z z

Public
z z

Contract
z z
z

General merchandise Special commodity Cold storage Household goods Bonded--used to postpone import duties and excise taxes until g good is sold Bulk storage
z z

Tank storage for liquids Open or sheltered storage for dry

Centre of Excellence - Supply Chain Management Institute of Logistics

Warehouse Activities
Proportion of Time and Money Spent on Major Activities

60 50 40 30 20 10 0
Receive/Put-away Picking Shipping Support

Centre of Excellence - Supply Chain Management Institute of Logistics

Warehouse Activities
z

Receiving
z

all activities related to accepting freight from a carrier, evaluating the condition of the freight, and assuming ownership of the freight

Put-away
z

all activities related to the movement of product away from the receiving area to storage locations within the warehouse or to the shipping area for immediate delivery
Centre of Excellence - Supply Chain Management Institute of Logistics

Warehouse Activities
z

Order Picking
z

the process of selecting goods from the warehouse and assembling them for customer orders

Replenishment
z

maintaining an adequate inventory in picking locations for the timely selection of customer orders

Shipping
z

the planning, consolidation, loading, and dispatch of customer orders from the warehouse facility

Shipping Principles
z

Accuracy Related
z

get the right product to the right customer

z z z

double check destination prior to loading mark products clearly provide driver with load diagram

Key Management Activities

z

Order picking, replenishment & shipping

z

adequate staffing
z

proper scheduling to ensure productivity dont let replenishment get too far behind or ahead flex staff when necessary perform f accuracy checks h k sequence work effectively

maintain proper balance of labor

z z

inventory control & verification

z

meet scheduled delivery times

z

The Ultimate Impact

If warehouse activities are not performed effectively, your organization y g will not be able to deliver.
the right product in the right quantity in the right condition at the right place at the right time for the right customer at the right cost

Performance Analysis Key Warehousing Measures

z

Financial
z

Productivity
z

activity based costing Putaway accuracy Inventory accuracy Picking accuracy Shipping accuracy
z

Quality
z z z z

Units shipped vs. vs hours used Storage density Equipment uptime Labor performance

Utilization
z z

z z

Efficiency y
z

Order cycle time

Warehouse performance
Performance Analysis
Warehouse productivity [Lines per Hour]
25

Warehouse Order Cycle Time [Hours]

2 24

12 120 75 0 48
99.97%

Storage Density [Cases / Sq. Ft]

99.98%

Dock to-Stock Time [Hours]

2 95 99.5%

Shipping pp g Accuracy [%Error Lines]

-----Company A World Class

Inventory Accuracy [%Discrepancies]

Institute of Logistics

Warehouse performance
Dock to Stock Cycle Time

Institute of Logistics

Warehouse performance
Inventory Accuracy

Institute of Logistics

Warehouse performance
Shipping Accuracy

Institute of Logistics

Warehouse performance
Order Turns Times (Order Cycle Time)

Institute of Logistics

Challenges of Todays Warehouses

An Increased Number of Products Stocked
Proliferation of products Increasing number of SKUs for the same product Personalization of products Customer want their names on the product

Zero Tolerance for Errors

Customers intolerant to Logistics Errors Incorrect picking or shipping

Operational and Capital Cost Reduction

Industries under constant cost and margins pressure - Competition

Challenges of Todays Warehouses

z

Supply Chain Integration

z

Focus of current logistics operators Improving customer service by working more closely with suppliers, customers & other partners in the supply chain

Reduced Cycle Time

Customers try to reduce the amount of time that inventory is stored in a warehouse/ business transaction cycles.

Challenges of Todays Warehouses

More frequent shipments with smaller quantities
Inventory is being forced back in the supply chain Reduced delivery sizes put increased demands on warehouses to ship partial pallets rather than full pallets

Value Added Service

Customers expect distributors to take over many of the supply chain functions they once handled in house Ex: Quality control tasks, (re) packing, compliance documentation, labeling and kitting

Challenges of Todays Warehouses

Increased Competition
Customers need to maximize revenue per order

Need for Tracking and Tracing

Increasing demand for transparency and visibility across the supply chain

A WMS

Warehouse Management At-a-Glance

Inbound Internal Processing Outbound

Purchases Mfg / Assembly Transfers Outside Processing

Pick Pack Inspection Count

Assembly Storage Move Replenish

Customer Shipments Vendor Returns Transfers Outside Processing

Senior level executives now realize that the automated warehouse is as much a part of e-commerce and e-fulfillment as the Internet. - Supply Chain Yearbook

Warehousing Functionality Spectrum

High

Produ uct / Order Complexity y

Highly g y Automated Facilities

Automate physical inventory handling

Warehouse Management
Implement a true execution system using system directed tasks and task management

RF / Barcode Only
Improve accuracy and reduce latency of existing transactions

Manual Inventory
Record transactions and track balances

Low

Small

Transaction Velocity / Volume

Large

Business Pressures
Just-in-Time Delivery
How can I improve the speed of warehouse operations? How do I integrate operations to reduce order processing time?
Inbound Internal Processing

Guaranteed Availability
How can I improve order promise accuracy? How do I create a global view of inventory?
Outbound

One Size Fits One

How can I manage SKU proliferation? How do I ensure labeling compliance?

Lowest Total Cost

Where can I reduce inventory while maintaining high fill rates? How do I improve labor efficiency?

Warehouse Management Solution

Purchases Customer Returns Transfers Receive Inspect Directed Putaway Assemble Tailorable Rules & Workflow Process Label Replenish

RF Support Global Ship Visibility Pack Directed Pick

Cost WIP Issues

Move

Transfer Customer Orders Returns to vendors Transfers Planning Purchasing Manufacturing Fulfillment Seamless S l Integration

Count

More Ways to Automate

Characteristics
Compliance Labeling Task Exception Handling Cartonization
Automate label i i ( printing (correct format, place, & time) Records transaction exceptions and triggers workflows AutoAuto-select the right size and type yp of container Automatically control allowable transactions by status

Benefits
Eliminates costly man al processes manual Meet customer needs Automates corrective actions Permits analysis Reduces packaging errors and costs Increases efficiency Reduces shipment and handling errors

Material Status

Improve Warehouse Mgmt Functions

Key areas for improving efficiencies
z

Warehouse worker productivity

z z

Automated task dispatches / instructions Multi tasking, Reduced travel times & ability to handle greater volume of material Streamlined faster receipt processing Directed put away Increased speed & efficiency of transactions Increased picking efficiency Packing & labeling Reduction in shipping errors Increased velocity of material flow Greater visibility & higher inventory accuracy Improved stock rotation & reduced obsolescence Reduction in inventory levels

Inbound processes:
z z

Outbound shipments:
z z z z

Inventory management:
z z z z

z z

Data entry needs: Reduced efforts & increased accuracy Process automation with material handling device integration

Directed Put Away

Receipt p Pick

Resource Utilization

Automatically Suggest Optimal Locators

Locator Business Logic
z

Locator Locator

Slot Dynamically Based on Velocity, Size, etc. Control C t l Hazardous H d Materials / Co-Mingling Handle Task Exceptions with Reason Codes

Optimize the Use of Storage Locations Minimize Mi i i Inventory I t Fragmentation Reduce Chance of Obsolescence

Automated Compliance Labeling

Meet Customer Specific Requirements
z

Support Numerous Types and Variations of Labels

z

LPN, LPN content, LPN summary, material, serial, location, shipping, shipping contents, WIP contents Flexible configuration of labels Adapt to changing requirements

Flexible to Meet Your Business Needs

z z

Print at the Right Time in the Correct Format

Barcode & License Plate # Support

Perform Complex Inventory Transactions
Multiple Packages and Products Single Unique Number for All Information

=
Barcode Support z Automatically Track All Related Product Information
z

Container and LPN* Support z Supports Infinite Nesting Levels

z

Capture All Information with a Single Scan

Reduces Cycle Time and Improves Accuracy

Perform Complex Moves via a Single Scan

Improves Efficiency, Accuracy, and Tracking
*License Plate Number

Cross-Dock and Direct Ship

Cross-Dock

Inventory Utilization

Selectively Accelerate Warehouse Material Flow

Receive

Inspect

Deliver

PutPut -Away

Inventory

Pick Release

Pick

Drop

Ship

Direct Receipt

Direct Ship

Accelerate Receiving Process, Reduce Inventory and Handling

Directed Picking
Automatically group tasks & reduce picking time
z z

Resource Utilization

Wave Picking: Tasks dispatched line by line to picker Cluster Picking: Interleaving, sequencing tasks for various orders Order Picking: One order / job schedule at a time Zone Picking: All pick for order in a given location Bulk Picking: Picks for several orders from same location Pick and Pass/ Label Picking Paper Based & User defined Pick grouping

z z z

z z

Rules-Driven Processes
Flexibly Meet Business Needs
Directed Picking & Stock Allocation
Directed Put Away Task Assignment to warehouse workers Compliance labeling

Inventory Utilization

Transaction
(e.g. (e g Pick for customer shipment)

Business Rule for Stock Rotation: First look for lots with less than days shelf l th 30 d h lf life Then sort the available lots on the basis of FEFO

Lot Number/s & Quantities to be picked Picking location

System Suggestions

Warehouse Management Systems Potential Benefits

z z z z z z

Warehouse Labor Hours Inventory Write-offs Total Inventory Shipping Errors Management Time Inventory Counting Hours

10-30% 5-10% 5% 80-100% 50% 80-100% 80 100%

Sources: eSync

Superior RF Architecture
Eliminating Middleware Eliminates Complexity
RF Base Station (Router) LAN or WAN Mobile Transaction Server Application / pp Data Base

RF Device

Telnet Over TCP/IP

SQL Net

No Client

Software No Servers Required in Warehouse UI Built for Fast, Repetitive Work

Lightweight

Communications Optimized for WAN Performance

Scalable Central,

Middle Tier Professionally Managed Data Center

Choices traceability
Movement Vehicle Satellite ULD (air) Active RFID SemiPassive RFID Passive RFID Bar Code Paper Master Carton

Container (sea)

Pallet

Item

Bar Codes - Types

Sorting & Picking

z

Activities requiring hands-free:

z

z
z

Task direction & confirmation Data collection

Case Picking

Sorting & Picking

Sorting & Picking

Barcode vs RFID
RFId
Read more than one item at a time

Barcode

9 9 9 9 9 9

8 8 8 8 8 8

Read while item is moving

Line of sight read not required

Lifetime guarantee (100,000 reads)

Need for Physical handling to capture the media details Able to resist water damage

How does RFID work?

Reader Antenna Transponder
Transponder receives signal Transponder is charged with enough energy to send back an identifying response

Reader broadcasts signal through antenna

Computer System

Reader sends info/data to computer system for collecting, logging and processing

RFID Frequency lines

125 KHz 13.56 MHz 866 - 956 MHz 2.45 GHz

RFID: Access Control Animal ID

HF RFID

UHF RFID

Wifi RFID

Cordless Phone

Cell Phone

Microwave EAS

TV AM FM

10 KHz

100 KHz

1 MHz

10 MHz

100 MHz

1000 MHz

2.45 GHz

300 GHz

RFIDs in Warehouse Applications

RFID

RFIDs in Warehouse Applications

RFIDs in Warehouse Applications

The RFID DC / Warehouse

Pallet Jacks Portals Skate Wheel Conveyors Forklifts Clamp Trucks

Shrink Wrappers

Pallet Jacks

Mobile Carts

Tagging vs. Tracking

Conveyance
Bar code & 2D labels RF tags, DSRC GPS capability

Container
Bar Bar code & 2D labels Optical cards, tags, labels RF tags

Pallet
Bar code & 2D labels Optical cards, tags RF tags

Multipack
Bar B code, d 2D labels l b l Optical cards, tags Embedded RF tags

Part
Bar code, 2D label Inscribed part # Embedded RF tags

Pick to Light :
Features : Directs the picker with a light to indicate the pick location and number indicating the quantity

Pick to Display
Features : Directs the picker with a light to indicate the pick location, A number indicating the quantity, Can add text to the display and/or play an audio file to remind the operator t of f the th action ti they th are to t take, t k A digital image of the item being picked can also be added to the display.

Voice Recognition Systems

z z

Features : Facilitates two-way communication between warehouse workers and warehouse Management system (WMS) software. Warehouse workers receive verbal instructions (from the WMS) and respond verbally to them through a headset and microphone, working through a microcomputer that each employee wears on a belt. Voice recognition systems are paperless and, better still, leave employees eyes directly focused on the task at hand and their hands unencumbered.

Voice Recognition Systems

z z

Features : Facilitates two-way communication between warehouse workers and warehouse Management system (WMS) software. Warehouse workers receive verbal instructions (from the WMS) and respond verbally to them through a headset and microphone, working through a microcomputer that each employee wears on a belt. Voice recognition systems are paperless and, better still, leave employees eyes directly focused on the task at hand and their hands unencumbered.

Voice Recognition Systems

z z z z z z z

Benefits : Improved productivity, reduced customer returns, reduced employee training, higher employee retention, more accurate inventory accounting. Applications abound, Order selection being the most widely used application. But also adept at handling receiving,put-away, replenishment, sortation, truck loading, and cycle counting functions.

Voice Recognition Systems

z z

z z

Working : The Host computer receives a work file from the Warehouse Management System (WMS), These text based instructions are converted into speech commands, The Instructions are placed in a prioritized queue, The worker hears the command, The worker confirms after execution by speaking into the head set.

Quantified benefits
z

z z z

A retailers ware house handling 550,000 cases per month @ $15 a case, for total sales of $100 million a year, experienced : Order accuracy improved to 99.8% from 99.3%. Lost sales shrank to $200,000 from $700,000 Resulting gain of $500,000 exceeded the onetime cost of $450,000 to implement a voicerecognition system in this warehouse.

Source : ProLogis Supply Chain Review,March 2006

End of line Automation

Consumer Goods
Packaging Perspective
Pallet Load

Organized retail route

1000 kg
2 4 kg

15 - 24 kg

Laminate, Rigids,Cartons .
Strategic Tactical Operation

Retail pack
Promotions Consumer pack Retailer pack

Dist. Pack
X Secondary route Primary & secondary routes Secondary route Primary route In plant storage only

Retail packs
Hi-Cone Strapping Banding

Auto - 2 Wheelers Packaging

Export

SKD vehicles packed in plywood Issues of crate fabrication, availability Difficult to unpack & dispose at overseas customer Eco unfriendly

STRETCH WRAPPING
z z

Wrapping is for holding the load & stability Wrapping for unitisation and protection from dust
z

Selection of Material depends on the type of product, end usage and supply chain

Safe Product dispatches Blocking & Bracing-Air Bags & Void Fillers
Reduces the transit damages by securing the load firmly with the container No matter how tightly a load is positioned, either by fork truck or by hand, a build-up of small voids will remain. These voids are eliminated by air bag compacting and positioning the load for securement.