Horses for courses: Tracking and defining your facility's performance
It is critical that you take the time to describe the track and define performance requirements before picking the horses to run the race.
By John M. Hill, principal, ESYNC -- Modern Materials Handling, 11/6/2007
I receive calls all the time where the inquirers are asking for solutions with little or no attention paid to specific requirements, presuming there is one best solution for every warehouse opportunity; i.e., a single “horse for a course.”
Fortunately, or unfortunately, this is not the case! The alternatives available to tackle any materials handling or supply chain execution system challenge represent both the strength and weakness of an industry with as complete a portfolio of alternative solutions as any on the planet. Accordingly, it is critical that you take the time to describe the track and define performance requirements before picking the horses to run the race.
To begin, build a profile of current operations that includes:
FACILITY LAYOUT
- Size: Usable square feet, clear height
- Average capacity utilization
STORAGE LOCATIONS (No. of locations, size)
- Floor
- Pallet rack, flow rack
- Carton flow rack
- Bins & shelving
- AS/RS, mini-load, carousel
ACTIVITIES (Current, projected)
- Receipts/hour/day/peak (Trucks, railcar, other orders, lines, items, pallets, cartons, rolls, other)
- Picks/hour/day/peak (Orders, lines, items, eaches, cartons, pallets, other)
- Shipments (Trucks, rail, courier, other)
PRODUCT PROFILE (Current, projected)
- SKU dimensions and weights by handling unit
- Classifications; e.g., hazardous
- ABC percentages
PRODUCT CONSIDERATIONS
- Shelf life
- Lot and/or date codes, serial numbers
- Inventory turns
- Seasonal issues
- Quality control
MOVEMENT (Number, description)
- Lift truck
- Pallet jack, other
- Conveyor, guided vehicle
DATA COLLECTION (Number, description)
- Bar code scanners
- Radio frequency data terminals
- VDTs, CRTs
- Clipboards and pencils
HUMAN RESOURCES (Shift, total)
- Supervisory
- Lift truck operators
- Receiving clerks
- Order pickers (Non-lift truck)
- Replenishment (Non-lift truck)
- Inventory checkers
- Shipping personnel
- Data entry clerks
- Other
SYSTEMS
- Types
- Applications
- Interfaces
- Upload/download content and frequency
WAREHOUSE ENVIRONMENT
- Congestion
- Product damage
- Safety
- Other
Next, using labor hours drawn from payroll records, calculate current warehouse activity metrics (e.g., receipts per person per hour, picks per person per hour, order lines shipped/person/hour, etc.). To define the expected useful life of your current facility, review your corporate three-to-five-year forecasts and answer these questions:
- With no changes to layout, equipment or processes, how many additional people will be needed to handle anticipated growth?
- Without infrastructure changes and improved inventory turn rates, how long will the warehouse(s) be able to accommodate projected growth at current capacity use levels?
With the foregoing profile data, metrics and timeline in hand, you’ll be in a better position to identify and evaluate options for improving throughput and performance – and, extending the life of your facility. A good place to start is with CSCMP, MHIA and WERC, each of which can point you to the data you’ll need to narrow the field to those horses most likely to take you to the winner’s circle.
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