The Right People, Processes, Technology and Tools Help Achieve the Right Results

 In Insights

The Right People,Processes, Technology and
Tools Help Achieve the Right Results

“In today’s environment, “speed through the distribution center is critical,” notes Don Derewecki, executive vice president of Gross & Associates, a materials handling logistics company based in Woodbridge, N.J. “We’ve moved out of the age of warehousing into the age of throughput centers.”

Whether they’re called throughput centers, distribution centers, or warehouses, effective operations use best practices within the four walls of the facility—and beyond.

“We think of best practices as doing all the right things with the right tools and getting the right results,” explains Denny McKnight, partner, Tompkins Associates Inc., a supply chain integration firm headquartered in Raleigh, N.C.

Every warehouse and distribution center should have a best practices program, McKnight says. Such a program enables companies to reduce errors, labor, and cycle time while increasing accuracy and service.

“A best practice program, if done right, never ends,” he says. “Opportunity to improve is always there.”

What’s right for one company or facility—or even one product—is not necessarily a best practice for another company, facility, or product. A number of best practices do apply to many warehouses and distribution centers, however. They include the following:

Use advanced shipping notification (ASN). With ASN, suppliers notify receivers in advance, letting them know they are shipping a specific purchase order, and giving an expected arrival time.

“While the ASN can be sent via fax, using advanced shipment notification often implies an electronic data interchange or a web-based compliance module is used as part of an overall warehouse management system,” McKnight explains. And, knowing what is coming into the warehouse enables managers to preplan receiving for the day.

“When you don’t have an infinite number of dock doors, you need to schedule inbound receipts to increase dock utilization,” says McKnight. “You need to have a central point of communication, and be very clear to the carriers about who to call, and when.”

It’s important that both carriers and receivers be flexible. “Arrival times can’t always be controlled,” McKnight explains. “It’s not uncommon for the daily schedule to start slipping.”

Without scheduling inbound receipts, however, “you’ll randomly receive product as it arrives, and may have some carriers sitting in your yard for hours,” McKnight warns. “And you won’t be able to prioritize your receipts.”

Knowing in advance what product will be received and when, combined with system-directed putaway, makes it easier to treat incoming shipments appropriately.

This could mean crossdocking directly to shipping, or using the product to replenish a pick location that’s below minimum. Or the system may direct you to put the product into a reserve slot, for example, consolidating a less-than-unit load putaway in a location that already contains the same product.

Of course, this assumes that you’re not violating lot number integrity or first in, first out rotation requirements.

Implement a vendor compliance program. ”A vendor compliance program goes hand in hand with advanced shipping notification,” McKnight says. “You want notification ahead of time, and you also want to communicate with vendors exactly how their product should arrive.” This may include specific labeling requirements, and standard case quantities for each individual item. “Best practice distribution centers integrate operations with their suppliers. This way, suppliers help them achieve maximum throughput and maximum efficiency, in a minimum amount of time,” Derewecki says. Working with suppliers so they provide product configured for easy handling within your facility is key.

“A vendor compliance program needs to be a collaborative effort that involves procurement as well as DC operations,” says McKnight.

Companies often hire a permanent vendor compliance manager responsible for monitoring and measuring vendor performance, looking at what percentage of the vendor’s purchase orders comply with requirements, and where they’re complying.

“The goal is to get to 100-percent compliance, and to increase the supplier base that participates in your compliance program,” McKnight explains.

While direct communication with the supplier typically occurs through merchandising or procurement, the DC identifies issues and provides feedback to the merchandising or procurement representative who communicates with the vendor.

Use automatic data collection technology. ”People writing numbers on pads of paper or keying strings of numbers into a keyboard is a bad sign,” McKnight says.

The benefits of automatic data collection—via bar code and radio frequency identification—are well-established, including increased productivity and accuracy and lower labor costs. But plenty of companies still haven’t implemented automatic data collection.

“Some organizations with 30,000 or 40,000 item numbers and multiple facilities are still convinced they’re better off without technology,” McKnight says.

Preplan picking waves. ”Picks should be pre-planned, so companies have the right number of properly equipped pickers,” Derewecki suggests.

A facility may have separate zones for full pallet, case, and individual item picking. “Balancing those various zones with the proper equipment is a lot of science and a little bit of art,” he says.

Continually monitor the picking operation throughout each shift to make adjustments as needed, such as shifting pickers from full pallet to case picking to handle a surge.

Record every product movement as a transaction. ”Any time you move product in the warehouse, the move needs to be reflected by a transaction,” McKnight says. Loosely run facilities may scan product when it’s received and put away, but not scan further moves within a transaction, affecting the integrity of inventory data.

Use a hands-free order selection process. ”Having operators hold a piece of paper, read its contents, then go to a picking location is inefficient,” McKnight says. “Even using a handheld RF gun, workers have to scan, set the gun down, then make their pick.”

In facilities where the technology is appropriate, McKnight recommends hands-free order picking enabled by technology
such as wrist-mounted RF units, voice pick, and pick- or put-to-light order fulfillment systems.

Minimize touches. Several techniques help eliminate touches in the warehouse, including picking to a shipping carton rather than picking to a tote. A robust warehouse management system can enable picking directly to the carton, eliminating dedicated packing stations.

Also consider using print-and-apply labeling systems that print labels on the fly, and offer in-motion weighing and manifesting, as well as semi-automated or automated sealing/taping stations, all of which eliminate touches.

“Suppose it’s a loose pick operation. The order is picked into a system-designated repack carton, and is scanned and confirmed at the pick point. Essentially the pick-pack carton is conveyed to a dunnage fill and sealing operation, then on to an automated manifested operation,” Derewecki says.

blueStone Executive Search finds the right people for your company to execute your logistics and distribution strategy.

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