Manage Your DC Facility Improvements - One Process at a Time

Posted by Advanced Mobile Group on Feb 6, 2018 7:00:00 AM

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Facility-wide changes aren’t Easy and not always optimal.   
When your DC needs an upgrade, where do you start?

Something we see with every facility we visit is the desire by managers to continually look for new ways to improve on their KPIs and find innovative ways to do that. While every manager would love to have the resources to rebuild their warehouse facility, its processes, and layout from the ground up, this is possible only in the rare case that the business is growing so fast it can afford to build out a separate new facility to replace the older one when it is ready (or moving to an entirely new location).

This holds true for big and small operations. “Big” often implies “having more capital” to invest in major upgrades, but it also means “more legacy processes and risks” that can’t be plowed under so quickly when all the aspects of a large facility are taken into account: ERP systems, large teams to re-train, extensive fleets of equipment that might not be amortized, etc. along with a more hierarchical decision-making process that makes big decision harder than in  small facilities.

Rather than taking on the full list of desirable and achievable changes in one fell swoop, there are benefits to looking at your facility one process area at a time. The biggest benefit is avoiding the risk involved in making wholesale changes across multiple process areas – mistakes and system issues are harder to trace, harder to solve, and the burden on management chasing down issues that arise during the changeover is amplified geometrically.

By looking at one process at a time, facility managers can isolate issues and speed up troubleshooting, measure progress more precisely, and ideally generate enough incremental improvements that they determine they can extend the life of the current facility because they were able to increase velocity and capacity utilization, two of the biggest reasons businesses add more space – when perhaps they do not need to.

Here are a few places you might start that make big, measurable improvements possible within WEEKS:

The Lowest-Hanging Fruit: Receiving

There is no process area in the Distribution Center business more homogenous than the Receiving process. For nearly every facility on planet earth, the process goes something like this:

  1. Trucks back up to bay doors on Receiving dock.
  2. Pallets or boxes are unloaded by DC staff
  3. Pallets may be broken down into boxes, or not
  4. Pallets or boxes are labeled
  5. Pallets or boxes are put away into storage or replenishment areas

Simple as it sounds, too many facilities still have many ways they waste people-hours, space and time in this process. Pallets sitting on the dock waiting for labels or a lift-driver to come and put them away often means trucks are waiting outside for a bay to clear which incurs higher costs. Workers having to walk across a large facility to a printer room to get labels waste hours/day in extra steps, or sorting out from a pile of pre-printed labels results in higher mislabeling rates. Mislabeled items often get put away in the wrong location, which means they could be lost forever in some facilities.

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One simple innovation spreading through the facilities of the best 3PLs and Retailers is a simple “Mobile Powered Cart” solution.

 

Credit: Newcastle Systems https://www.newcastlesys.com/receiving-process-driven-warehouse

The entire workstation with the thermal printer and scanner is mounted on a lightweight cart with a power source on it (ideally, a swappable lightweight lithium battery – see photo). Doing this allows your team to print labels on demand by scanning labels on the incoming pallet or producing them from a manifest on their laptop. Labels on demand are more accurate, require no walking, and will move product off the receiving dock faster. Businesses are implementing “mobile printing” in receiving report up to 50% more efficiency in this space.

The Most Fun You’ll Have Improving: Inventory

Inventory has always been a highly manual process, even with barcodes and scanners making it easier than ever. However, it still requires a physical presence by a team of workers to find, identify and scan every single item in the targeted area. Inventory-taking is not just time-consuming, but it also disrupts work in any facility that is running multiple shifts or operating 24/7. In some industries, this is problematic and risky as it means delaying shipments or processing of orders until it is done.

The best idea we’ve seen for speeding this up and minimizing disruption involves two seemingly unrelated ideas: RFID and the Mobile Powered Cart already mentioned above. With the cost of RFID tags now minimal, RFID brings many opportunities beyond just the inventory process (which we won’t fully address at this time), including more accurate tracking of aging and movement of items in and out of and around the warehouse.

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If your DC works mainly with case or bulk items, adding an RFID tag at Receiving (in addition to or instead of a barcode), means that each case or pallet can have its movements tracked every time it is moved without any human intervention required to execute a scan. For the inventory process, it also means that a single person can do the inventory work in a fraction of the time it would normally take, and this is where the cart comes in.

By deploying a single cart with an array of RFID antennae mounted on a telescoping pole, a single person can walk down each aisle, pushing the cart and letting the antennae array automatically collect all the required information from each tag in the racks. The impact of this is multiplied for racks that would require lifts for staff to reach, or deeper racks that have multiple cases not easily accessed manually (i.e., flow racks).

The Most Challenging But Rewarding: Picking

Finally, it is always worth taking a look at Picking. Unlike the first two process areas described above, solutions to improving the Picking process don’t come easily, as picking processes are widely varied by type of business, industry, product type, etc.  While it is harder to find easy improvements, we list it here because in general, Picking is the most labor-intensive part of any DC operation. We’ve always found that the majority of businesses have a process that has evolved incrementally over time, and while may seem to be optimized for the process owners, tends to be missing improvements for lack of fresh eyes.

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If you are a small-to-medium size operation, it is very unlikely you have an internal engineer or consultant who is doing continuous improvement work to optimize your process in this space. The best way to start down the path to making changes with impact is to bring in an outside set of eyes and ears that can look at your process with a fresh approach, as well as bring with them the experience of having seen other operations from other industries from which they might find that there are best practices they could bring to your business too. These could be changes in layout, process, software, equipment or even training.

Unlike the first two process areas, this one requires spending money on expertise first, rather than a simple equipment combo. But if picking follows normal averages for the total share of labor in most DCs, then we recommend getting a professional consultation to see where your real opportunities are.

Getting Results One Process at a Time

Taking the “One at a time” approach to process improvement will work best if you select an area where you know success will come easier. It gives you a path to “learn as you go” and also generates more credibility for your efforts to upgrade, reform, remodel, etc. In lieu of the budget for a complete re-build of your warehouse and all of its components, it is also easier to measure and demonstrate the value of your bigger plans for the future – while also minimizing potential disruption to customers, morale issues among staff, and risk of having to troubleshoot issues that can’t be isolated to a single process easily.

 

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Topics: RFID, Inventory Managment, Distribution

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