Chapter 6 Process efficiency

Question 1

In which ways can service levels be improved in the effective stage?

Answer 1

1. Reducing response times.
2. Increasing availability.
3. Improving accuracy.
4. Increasing flexibility.

Question 2

How can response times be reduced?

Answer 2

By accelerating the planning stage - Orders often sit in the ERP and TMS systems for many hours and even days before being released to the WMS.
Once the planning is completed, the pick locations should already be replenished, and the operators can immediately start order-picking.
Trucks don’t have to way until all orders for the day are completed. Ready full truckloads can be picked up by the truck early. Orders should be picked in accordance with the sequence of the departure schedule to accommodate this.

Question 3

How can availability be increased?

Answer 3

i. To ship goods on time, sufficient quantities must be stored in the distribution centre. The source function has the responsibility of ensuring adequate stock levels. Identifying insufficient inventory levels can be done by analyzing the number of days on hand.

ii. Inventory might be unavailable because of inventory discrepancies. Improving inventory accuracy also increases availability. Accuracy can increase by improving procedures so fewer errors occur (preventive measures) or by more frequent cycle counting (corrective measures).

iii. Order can also be late because of a high workload, particularly when the workload exceeds the flexibility limits in the service level agreements.

Question 4

Identify the causes of errors to improve accuracy.

Answer 4

i. Preventive measure – enhance the procedures so that fewer errors occur. Six Sigma (in particular) is a useful approach for eliminating errors.
ii. Corrective measures – check the activities afterwards. E.g., cycle counting checks and inspections at the shipping dock (who check the work of order-pickers).

Question 5

What are ways that accuracy errors can be improved?

Answer 5

A weight-pick automatically inspects the orders after picking, i.e., a scale determines the weight, and the WMS compares it to the calculated weight of the picked goods. If the weight deviates from pre-specifications, they are passed to a human operator for further examination.
- Corrective measures are usually more expensive, and it is recommended to start with corrective measure to comply with accuracy targets and gradually reduce their efforts when fewer errors occur because of preventative measures.

Question 6

Name three ways of improving efficiency of processes.

Answer 6

1. Improve - when improving activities we continue with the same activity but doing it in a more efficient way.
2. Combine - combine activities and create economies of scale.
3. Eliminate - eliminate activities that are redundant or happen because of improper or erroneous activities upstream.

Question 7

How can we eliminate processes?

Answer 7

1. Having more reliable processes and improved data interchange can lead to many activities being eliminated.
   Administration and managerial activities can be eliminated if RF terminals are used instead of manual processing of inventory levels and status needing updating after order-picking. RF terminals also tell operators which tasks to perform eliminating workload from team leaders.
2. Receiving - Operators can perform random checks where the frequency of the checks is based on the delivery performance of the supplier (a vendor rating).
   After scanning goods with a unique SSCC number, they can immediately be put aways or cross-docked. Orders can thus be allocated to goods that are still in-transit.
3. Dynamic pick locations - the forklift driver replenishes the pallet to a nearby empty pick location, avoiding the need for restacking (as with static pick location). Order-pickers pick from the old pick location until it is empty and then start with the new one. The old location because available for another product.

Question 8

How can activities be combined to make processes more efficient?

Answer 8

1. Batch-picking - A popular method to combine activities.
   - Instead of only picking a single order in a pick tour (single-order picking), the operator picks multiple orders simultaneously.
   - The travel distance doesn’t (significantly) increase and combining multiple orders in a single tour will reduce the overall travel time.
   - The order-picker either sorts the order during the pick tour (sort-while-pick) or afterwards (pick-and-sord).
   - Batch-picking is only practical when the travel time saving offsets the additional handling time.
   - The number of orders that can be picked in one tour is limited by the volume capacity of the pick cart.
   - Therefore, we could further increase the number of batched orders by picking orders in parallel zones.
2. Zone-picking - requires order lines from various zones to be sorted as well as consolidated after picking.
   - In batch picking, a single picker usually will fulfil several orders in full. In zone picking, a single order is split among multiple pickers who pick different items within the order that are located in a similar area (or zone) in the warehouse.
   - Again, the travel time saving should make up for the additional handling time.
3. Dual-command cycles - A WMS with real-time communication can combine pallet moves for put-away, replenishment and pallet picking into dual-command cycles.
   - They reduce the empty travel time compared to single-command cycles.

Question 9

How can activities in the warehouse be improved to increase the efficiency of processes?

Answer 9

Continue with doing the same thing, only more efficiently.
Modern technologies like voice-picking and pick-to-light help to improve efficiency.
Other examples:
- ABC classification to reduce travel and handling times.
- Pick sequencing routines that reduce travel distances or limit the number of aisle changes of the forklift truck.

Question 10

Explain ways that warehouse flexibility can be improved.

Answer 10

1. Onboarding – The capability to introduce new staff, products, suppliers, customer, or service providers to the warehouse operation.
   - Modern WMSs guide operators with RF terminals through their tasks in an intuitive manner taking away the need to extensively train operators.
   - They can typically start working after a 15-minute introduction and become fully productive within a few days.
   - A Product Information Management (PIM) system makes it easier to onboard new products.
2. Scalability
   Upscaling - The capability to increase the warehouse’s capacity to meet growing demand.
   Downscaling – Meeting declining demand.
   Flexible contracts with staff, a labour pool of temporary workers and flexible contracts with staffing agencies allow the warehouse to scale up and down.
   - The workforce should be a good mix of permanent and temporary staff.
   - If stock levels grow, storage capacity can be increased by using overflow warehouses by acquiring new storage space or outsourcing to 3PLs. (Second option is the more flexible solution).
3. Agility – The capability to quickly respond to changes in the supply chain.
   - Changing customer needs or supply disruptions requires an appropriate response from the warehouse.
   - The warehouse manager and staff should quickly revise existing processes, train people, and redefine planning and control rules to accommodate new requirement.
   - Can the warehouse staff reconfigure the software or is external support needed.
   - Conclusion: a flexible WMS is a key enabler of agility.