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Receiving – Begin with the End in Mind

Accurately identifying and quantifying goods is key and core to the receiving process within a warehouse or distribution center. The most common method by which a Warehouse Management System (WMS) facilitates this process is by using as-ordered details as a reference for the teammate performing the receipt.

However, considering inbound orders are often not shipped complete (i.e., all items) and in-full (i.e., all quantities), you will find receiving teammates negotiating a variety of paperwork (bill of lading, packing lists, shipment manifest, etc.). Along the way, this paperwork will gain a range of hand-written notes, tally marks, calculations, circles, and checkmarks. When a product is received in quantities less than as-ordered, these manual notations serve as an effort to determine if product matches the as-expected quantities detailed in the paperwork.

In many facilities, that paperwork – now decorated with all the above manual notations – will be reviewed at a later time, in a different location (typically in the “office”) by a separate teammate. Office teammates often serve as gatekeepers to the receipt “closing” process. This additional step has been inserted into the critical path as a natural outcropping because of the nature of the WMS and ERP interfaces. Typically, corrections and adjustments to a receipt’s details after closing the receipt are very difficult, if not impossible. Therefore, extraordinary efforts are made after physical receiving is complete before the receipt is logically closed.

To further safeguard the ability to review, research, and resolve potential receiving errors, the put-away process is often delayed until the receipt can be reviewed. Subsequently, inbound staging areas can become congested and the availability of product to fulfill outbound orders is delayed. If the product in question had been put-away, the research process might now extend from pillar to post within your facility.

Does this process sound familiar? Do you see aspects of the above within your facility every day? If so, you likely did not see these nuances presented in the vendors’ demos during your WMS selection process. Rather, these are additional, manual steps added to your receiving procedures based on experience after the WMS was installed – after critical mistakes in identification and/or quantification were made and a pledge was made to safeguard against that risk going forward.

Take comfort in knowing that you are not alone and there is a better way. I suggest that the receiving process begins with the end in mind. Temper eagerness to start the physical receiving process until the as-expected quantities have been electronically exposed to the WMS. The details of what is expected on a given receipt (versus what was ordered) can be used to more precisely control the receiving process itself (identifying overages) and facilitate post-receipt reconciliation (identifying shortages).

The as-expected details can most efficiently be defined by leveraging an ASN (EDI 856 transaction). However, where an ASN is not available, traditional paperwork can provide the same benefits by availing an efficient process to key-enter the details. For example, when using a key-entry by exception process, a receipt’s as-expected details are initially defaulting to be equal to as-ordered. Therefore, key-entry is only required to adjust orders/lines where the paperwork indicates quantities different than as-ordered.

Where a vendor ships an order in full (all items, all quantities), there is essentially no difference between the as-ordered and as-expected receipt preparation process. However, when the as-expected preparation process is used, the receiving teammate will expect that their efforts to identify and quantify product should match the as-expected details, regardless of any split-shipments, back-orders, or shortages. Subsequently, teammates will be able to reconcile their work in real-time on the receiving dock while still at arm’s length to the product.

With the level of affirmation availed by the as-expected preparation process:

  • Items not expected can be excluded from the receiving teammate’s consideration
  • Any unexpected overages will be immediately known during the receiving process
  • Any unexpected shortages will be identified as soon as all product has been received

All of the above allows for the potential to allow receipts that match as-expected details to be closed more in real-time on the floor. Alternatively, all receipts can be closed in the office, distinguishing clean receipts, where they are actually matched as-expected, versus those that may require additional review.

The as-expected receiving preparation method empowers the on-the-floor teammates by reducing confusion and uncertainty. Triangulation of ordered, expected, and actual provides a stronger receipt control process. The more upfront information you have, the quicker and more accurate your receiving process will be.

–Kail Plankey, St. Onge Company

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