Int working smarter_whitepaper
- 1. WHITE PAPER Working Smarter with What You Have Boost productivity of existing distribution systems with four cost-effective solutions By John Naylor, Intelligrated In today’s credit-strapped economy, squeezing greater performance out of existing Whether your goal is infrastructure and equipment is a key DC management strategy. By optimizing the to stay out in front of efficiency and utility of buildings, equipment and systems that have already been paid business growth or to for, companies can realize bottom line-enhancing productivity gains without major scale back operational capital expenditures. costs to conserve capital in a shrinking economy, Repurposing existing technology can also enable efficiency gains and increases in the good news for capacity that allow older DCs to accommodate SKU growth, increases in store count, or adapt to changes in the order profile without major expansions or greenfield DCs is that efficiency, construction. Efficiency improvements also make companies more nimble, giving them productivity and capacity the flexibility they need to more rapidly adapt to ongoing market and business changes. can often be increased without a significant Handling more throughput with existing “maxed out” systems investment in additional labor, floor space or The traditional response to dealing with the demands of growth has been to apply additional labor. Although this tactic can provide immediate incremental increases in equipment. a DC’s capacity, there is a limit to how effective it can be in the long term. Eventually, other constraints such as insufficient sorter speed, or too few pick faces or loading doors, will make additional increases to the labor force an inadequate solution. At this point, the traditional “Plan B” was typically to purchase additional equipment, ex¬pand square footage, or both. However, the current state of the global economy is causing the usual paradigm to change. Today, when labor increases are no longer the answer, and large capital expenditures are out of the question, it is time to examine the DC’s operation and identify opportunities for reconfiguring material handling systems, adopting new software and/or altering processes to increase efficiency and overall productivity. Productivity = Efficiency x Utilization Productivity is a function of both efficiency and utilization. For example, the most efficient way to get product from one side of the DC to the other is to cross-dock. The process of unloading goods at receiving and moving them across the building, directly onto another trailer is 100 percent efficient. But efficiency is only one part of the productivity equation. Even though it is the most efficient process you can perform, if you can cross-dock for only five percent of the time, it is actually only five percent productive (100% efficiency x 5% utilization = 5% productivity). The goal of 100 percent productivity via cross-docking can be achieved only in a true “store per door” environment, in which there is a 1:1 ratio of stores serviced by the DC to actual ‘live’ shipping doors with constant availability (100% efficiency x 100% utilization = 100% productivity). In the real world, few companies have the resources required to fully implement such a system, but utilizing the principles of cross-docking in all other operations will increase productivity. It is important to note that these principles can be applied for order fulfillment, manufacturing and shipping to achieve higher productivity and lower costs. While 100 percent productivity remains the goal, the first step toward this ideal practice is a hybrid solution known as the two-stage cross-dock. www.intelligrated.com 1
- 2. WHITE PAPER Solution #1: Two-Stage Cross-Dock to Cut Picking Labor in Half “...if you can cross-dock Outbound positions staged in waves reduce labor, rolling stock and space requirements for only five percent of the time, it is actually It is possible to markedly boost a DC’s order fulfillment productivity by implementing only five percent a two-stage cross-dock process that capitalizes on the efficiency of the cross-dock, productive.” significantly increasing utilization without large capital expense. The two-stage cross- dock leverages existing assets to increase order fulfillment efficiency. When allocated products, those that are already part of an existing order to be filled, arrive without a corresponding outbound trailer waiting at a shipping door, additional outbound positions are necessary. These are created by combining products into waves as they are received. Waves are then staged in a buffer consisting of a floor position, a pallet position, AS/RS, or a trailer. When a shipping door becomes available, the waves that comprise the order are pulled from the staging area and loaded onto the appropriate outbound trailer. This process can also be used for other operations; for example, allocated full cases destined for a split case order fulfillment system can be staged by wave and introduced into the tilt-tray, cross-belt or put-to-light system when the wave becomes active. This effectively eliminates the putaway and discrete picking of cartons by wave. The two-stage cross-dock can reduce re-picking labor by more than 50 percent. Although more labor intensive than a single-stage cross-dock, it is an attainable solution that requires fewer shipping doors and uses significantly less labor than the typical material handling process (see Figure 1). The two-stage cross-dock example illustrated in Figure 1 reduces rolling stock requirements by eight units and associated battery requirements, and saves 127,000 additional square feet of floor space by eliminating the need for a pick conveyor, a pick module and associated racking. Figure 1 - Process and Rates Comparison Current Process and Rates (3,280 per hour) Hand Palletizing Storage Receiving 400 cph 36 Pal/HR 17 People 6 People Module Pick Mod Replenishment Shipping 400 chp 36 Pal/HR 17 People 6 People Projected Process and Rates (3,280 per hour) Direct Unloads Wave Sort/Load Receiving 800 cph 600 chp 8 People 11 People Direct Unload Trailer Pull Shipping 900 cph 2 Person 8 People www.intelligrated.com 2
- 3. WHITE PAPER Solution #2: Minimizing Product Gap to Increase Sorter Throughput Decreased product spacing yields 40 percent increase For many DCs, sorter throughput is a pinch point that negatively affects order fulfillment efficiency. While modern sliding shoe sorters have reached the 600-650 ft/ min milestone in recent years, many existing sorter systems are limited to speeds equal to or in some case significantly less than this benchmark. The physics of the divert angle limit these existing systems, making it impossible to speed up the sorter without a major rebuild of the shipping system. Fortunately, speed is not the only parameter affecting sorter throughput. By simply reducing the gap between cartons from the traditional 12 inch average to four inches, sorter throughput can be increased by up to 40 percent. Intelligent software, available from suppliers of material handling systems, puts these throughput increases within reach of DC operators without the need to invest in additional capital equipment. In many cases, a 40 percent increase in throughput can eliminate an entire shift of operations. Solution #3: Balancing Merging for Maximum Efficiency “Due to slotting, a pick Real-time balancing of induction lines by the merge can reduce gaps and eliminate flow module may be tasked stops — producing a higher system yield. with 50 percent more Most distribution centers that operate within a ‘wave’ environment or have a strict case volume for a given cutoff time in a “store per door” setup suffer from a lack of balance in the operation. wave than all other It is natural for resources in various areas of picking, from modules to cross-dock and modules” pallet strip lines, to operate at different rates from each other and also vary individually throughout the day. A contributing factor to imbalance is simple math in terms of the workload. As a result of slotting, a pick module may be tasked with 50 percent more case volume for a given wave than all other modules. A typical induction system does not take into consideration the real-time wave progression of the in-feed lines. Instead, it simply releases lines based on a simple set of algorithms – round robin, “first come first served,” etc. The effect of this is felt toward the end of the wave/batch. As areas are completed and the wave totes arrive at the merge, the line is disabled until all lanes have successfully completed. To provide some temporary relief, some systems are equipped with wave overlap lanes; this does not directly combat the issue, however. When the quantity of active lanes cannot sustain the maximum capacity (100 percent efficiency) of the sorter, it becomes a major drain on productivity. The longer the system operates (utilization) in this state, the lower the overall yield (productivity). As an example: A sorter and an 8:1 merge have a total capacity of 200 cartons per minute (cpm). Each induction line is capable of releasing 50 cpm and four lines are needed to sustain 200 cpm. Due to imbalance, the last four lanes finish at varying times. During the time that lanes 1 through 4 are completing, there are four lanes left and the sorter is running at 100 percent efficiency. Anything less is a major loss of system efficiency as shown below. As the duration increases, productivity is lost. With three lanes x 50 cpm = 150 cpm (75% efficient) With two lanes x 50 cpm = 100 cpm (50% efficient) With one lane x 50 cpm = 50 cpm (25% efficient) It is typical for a traditional batching system to yield about 75 percent of mechanical capacity. Traditional combiners, which “zipper” cartons at the merge point, produce relatively larger gaps between product and are typically limited to a maximum of four incoming lines. They are also more susceptible to productivity loss because of a lack of balanced workloads. www.intelligrated.com 3
- 4. WHITE PAPER Wedge merges are becoming an increasingly popular alternative to combiners as a result of their ability to help maximize sorter utilization. With better batch flow control and up to or over 16:1 merge capability, wedge merges offer more flexibility and less exposure to productivity loss. Software and intelligent systems controls are available to enhance these merge/induction setups and can make an existing DC more productive. By setting the merge release logic priorities based on the forecasted volumes for each induction line (case footage in lieu of carton count is more precise), the system can better marshal the workload through the system. To maintain better balance, unbalanced lines are released based on percentage and real-time status and updates. Figure 2 illustrates the different release times associated with an unbalanced five-line merge of a 10,000 carton wave. Figure 2 - Wedge: Workload Balancing Lane 1 - 20% of Release Time Lane 2 - 10% of Release Time Lane 3 - 20% of Release Time Lane 4 - 20% of Release Time Lane 5 - 30% of Release Time Lane 1 - 2,000 Cartons Lane 4 - 2,000 Cartons 10,000 Carton Wave Unbalanced Lines Lane 2 - 1,000 Cartons Lane 5 - 3,000 Cartons Released by Percentage Lane 3 - 2,000 Cartons Real-time progress should be measured through the merge while making “on the fly” adjustments based on current wave status. Typically, there are higher-velocity picking areas in a system: cross-dock vs. module. Although these areas have the same quantity of cartons assigned for a wave, one may finish in half of the time even with the same quantity of resources applied due to the nature of the pick operation. It is not unusual to see a higher-velocity pick area have more volume because of slotting of higher SKU velocity movers. As they progress at different rates, each would require different merge release priorities at different times in the wave. Converting or enabling the merge and system controls and software to monitor progress allows for precisely balanced picking, providing much higher system yield (productivity). Solution #4: Offset Wave Plan to Balance Loads and Optimize Staffing Levels Predictability ensures that loads are completed within minutes of each other The stop/load model, a traditional retail door plan in which order waves are assembled at a series of stops throughout the facility, allows DCs to load more store orders through a limited number of doors. This method is highly sensitive to imbalance — a slowdown www.intelligrated.com 4
- 5. WHITE PAPER at a single pick module or shipping trailer can disrupt the entire flow and severely reduce overall productivity by delaying wave completion. These unpredictable variances in wave times and volumes inherent in the stop/load plan create gaps between waves that reduce efficiency. By shifting the wave paradigm slightly, an offset wave plan (see Figure 3) improves upon the stop/load model by eliminating its unpredictability. The offset wave plan not only increases the number of active doors compared to a standard (odd – even) stop/load dock plan, but also removes the randomness that makes it impossible to predict how many doors will be pulled. In a 44-door example, 40 doors are active, of which four are being pulled at any one time. This model’s predictability makes it easier to deploy optimum staffing levels and provides better control over minimum/ maximum load per door per wave. Figure 3 - Offset Wave Plan Doors 41 to 44 Waves 8 to 17 Waves 12 to 21 Waves 23 to 32 Doors 1 to 4 Waves 1 to 10 Waves 13 to 22 Waves 24 to 33 Doors 5 to 8 Waves 2 to 11 Waves 14 to 23 Waves 25 to 34 Doors 9 to 12 Waves 3 to 12 Waves 15 to 24 Waves 28 to 37 Doors 12 to 16 Waves 4 to 13 Waves 16 to 25 Waves 29 to 38 Doors 17 to 20 Waves 5 to 14 Waves 17 to 26 Waves 30 to 39 Doors 21 to 24 Waves 6 to 15 Waves 18 to 27 Waves 31 to 40 Doors 25 to 28 Waves 7 to 16 Waves 19 to 28 Waves 32 to 41 Doors 29 to 32 Waves 9 to 18 Waves 20 to 29 Waves 33 to 42 Doors 33 to 36 Waves 10 to 19 Waves 21 to 30 Waves 26 to 35 Doors 37 to 40 Waves 11 to 20 Waves 22 to 31 Waves 27 to 36 Each section of every trailer gets an almost equal amount of product at the same time. Although the offset wave plan may add a few more waves to the day compared to the stop/load model, balancing loads ensures that all loads are completed within just a few minutes of one another. This wave plan effectively balances the entire shipping operation. The workload is distributed across all doors and personnel evenly, allowing for predictable staffing levels and movement of resources. This helps to eliminate the scenario where shipping is waiting for a small number of doors to be completed so that the merge can release the next wave. This also ensures that the amount of doors active in a wave are great enough to prevent overflow of product to re-circulation — imagine 200 cartons per minute being distributed to four doors as a result of wave planning — and shutting down the merge. See Solution 3 for examples illustrating the effect of merge inefficiency. In either event, the utilization of the system greatly suffers. The offset wave plan ensures that the merge and sorter are producing higher throughput for a greater percentage of the time. Conclusion By taking advantage of a good warehouse control system, good processes and your existing space and equipment, you can increase productivity without great expense while scaling back your operations to meet your changing needs. System integrators, software providers or material handling equipment suppliers can help discuss which options make the most sense for your operation. For more information, contact Intelligrated by e-mail at info@intelligrated.com or by phone at 866.936.7300, or visit www.Intelligrated.com. www.intelligrated.com 5