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Long Technology Lead Times Drive Non-Capital Improvements for Holiday Prep

Long Technology Lead Times

The material handling industry is not immune from pandemic related demand surges and global supply chain interruptions leading to long lead times, opportunistic pricing by suppliers, and unreliable installation scheduling.

Many distribution operations finally stabilizing from a roller coaster year due to pandemic operational complications and drastic changes to demand patterns are looking forward to what promises to be a rowdy holiday season and finding that many capital equipment solutions that could help meet the expected elevated demand simply cannot be installed in time.

Non-Capex Solutions

With Capex solutions just not an option, many distribution operations are searching for ways to control labor costs or even to find ways just to keep up with higher anticipated holiday demand.  The good news is that a systematic evaluation of an operation can often uncover simple and effective ways to improve performance efficiency and capacity without capital equipment.

In addition to lead time benefits, many non-capital improvements such as improvements to systemic functionality as well as resource and shift planning also have the advantages of low cost and future flexibility.   Flexibility, in particular, has growing value among our clients in the current environment.

Systemic Improvements

An audit of the flow of materials through a facility often results in systemic improvement recommendations.  As you follow the path of an item from receiving to storage, through the replenishment process and finally through picking and shipping, if you find instances where the path of the item is non-direct or if you find that there is excessive manual handling of that item, often the following example systemic improvements can have a significant impact:

  • Directed Put away & Reserve Zoning – Creating zones within the reserve storage structure can help provide a more direct flow of materials through the warehouse. Directing products to reserve locations near their forward pick locations or providing the most travel efficient reserve locations to the fastest turning SKU’s can be an effective way to reduce material handling.
  • Forward Pick Slot Location Size Profiling – Forward pick slot location size profiling can have a dramatic effect on the efficient flow of materials through the facility. Ensuring that a SKU’s pick location is sized to accommodate a target inventory “days of supply” appropriate to the planned future operations profile can minimize stock-outs, replenishment labor and problems for the picking operations.
  • Systemic Replenishment Logic & Strategy – Systemic replenishment trigger points, use of non-emergency replenishments, and replenishment waving timing and strategy can be evaluated for possible improvements to replenishment labor and improved pick location inventory levels.
  • Slotting – Proper SKU slotting in the forward pick area can make or break the performance of an operation. Proper slotting can reduce picking travel, lead to a more ergonomic picking task and minimize post pick consolidation in addition to possible replenishment task benefits.

Resources & the 24 Hour Clock

  • 24 Hour Clock – An examination of an operations 24 hour clock can often uncover potential for capacity improvements. A good exercise is to challenge the points on the 24 hour clock and identify any flexibility around key order cycle milestones; the point that orders are received, replenishment waves are created, the point picking waves are created as well as when outbound loads are dispatched.  Look for points related to these key milestones that will allow for expanded hours associated with any resource constraints such as conveyor capacity, powered, equipment or dock space.
  • Staffing Structure – An audit of the staffing structure associated with an operational shift schedule and with consideration of equipment and other resource availability can often lead to a more balanced flow of work through the facility and improved utilization of equipment.

Holiday Success

Although the ship has likely sailed for mechanical and automation solutions to be the answer to increased capacity this holiday season there are a number of non-Capex solutions available to operations through a systematic evaluation that are both effective and possible to implement before the onset of seasonal demand.

—Jason Gryszkowiec, St. Onge Company

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