Vertical is in. And it's the pathway to better parts management at Parker Hannifin's Forest City, N.C. assembly plant. Vertical lift modules (VLMs) and a single vertical carousel are now strategically located around the shop floor for point-of-use delivery of parts and improved inventory control.

These systems (Remstar, www.remstar.com ) make very good use of the vertical cube in the hydraulic valve manufacturing plant. They're augmented, moreover, with rack systems, each with its captive stacker crane, for heavier parts storage. In total, there are several dozen of these three types of point-of-use systems supporting lean manufacturing, cellular assembly. The Forest City plant, moreover, is considered by Parker Hannifin executives to be a leader in its division in manufacturing technologies.

This plant's vertical storage/ retrieval, point-of-use approach to parts handling also has eliminated the need for a major brick-and-mortar expansion, points out Bill Birkenberger, team leader at the plant.

Valves are manufactured in the Forest City plant by self-directed teams, with each team manning one or more manufacturing cells. A cell typically consists of machine tools (for machining valve bodies), assembly tables, and test stands. Many of the valves are made to customer order, meeting 1-, 2-, or 3-day shipment delivery requirements.

In 1999, this plant was assigned the job of integrating the manufacturing operations of another Parker Hannifin plant. Initially, company managers considered assigning the incoming operations to floor space used by the Forest City plant's purchased-parts warehouse. This initial plan also envisioned expanding the plant by building a new, small warehouse, recalls Birkenberger.

But upon further study, the Parker Hannifin team considered a more revolutionary approach: 'Why don't we take advantage of unused overhead space by shifting parts inventory for both the existing and transferred manufacturing operations into the plant's vertical cube at points-of-use on the shop floor? That was the question we asked ourselves,' notes Birkenberger.

This approach would eliminate the need for facilities expansion altogether. And it could offer other benefits as well.

Improved inventory control was one big, potential benefit, as Ed Bosgra, process engineer, points out.

Analysis of inventory control in the existing warehouse by the team indicated there were problems to be resolved, he explains.

Parts previously stored in a warehouse were stacked on shelving and pallet racks. Maximum storage height allowed by building code was only 16 feet in these systems. Retrieving parts from the shelving was slow, as it typically is in a manual, non-mechanized system.

The corporate mainframe computer - with all the other functions it performed - had limited capability to track parts. At times, parts were temporarily lost in the system. There also was difficulty in assuring desired first in/first out (FIFO) parts retrieval. As a result, Parker Hannifin carried excess inventory in order to maintain high levels of customer service, as Bosgra notes.

The first step in designing an improved shop floor, point-of-use system with vertical storage and retrieval was to determine the types of automated equipment that would be most appropriate for the job. Parker Hannifin evaluated VLMs and vertical carousels, racking with captive, mechanical stacker cranes, and horizontal carousels.

To determine if the point-of-use, vertical storage/retrieval concept was right for Parker Hannifin, the company first installed two VLMs. Based on an analysis of this trial of the technology, the company calculated how much of the plant's vertical cube would be required and how much floor space the storage equipment would require.

Based on the results of this analysis and evaluation, VLMs, a vertical carousel, and racking systems with captive stacker cranes were installed to serve assembly operations on the shop floor. The majority of parts are stored in the VLMs. Vertical carousel storage/retrieval is dedicated to O-rings, a light load. The rack systems store unmachined steel valve bodies densely packed in wire baskets.

Because of a 23-foot clear height over most of the shop floor, most of the VLMs, the vertical carousel, and the racking with stacker cranes are each about 22 feet high. Each VLM takes up about 70 square feet of floor space.

With these storage units rising as high as possible, Parker Hannifin minimized its shop floor space requirements. It also reduced the number of systems needed for parts storage.

Valve components are picked either individually by keying in a part number (p/n) into a PC at each VLM, or in volume by keying in a bill-of-material (BoM) number or an order number. The p/n, BoM, and order numbers are printed on production orders delivered to the teams.

In some cells, parts tend to be picked individually, in other cells in volume. When picking to a BoM or order number, the VLM automatically cycles from tray to tray as parts are retrieved. If parts are located in several VLMs, keying the single BoM or order number triggers the VLMs in sequence.

The computer terminals are tied to a single PC server loaded with operating/inventory management software.

This picking system is far more efficient than the shelving and pallet rack methods that preceded it, says Bosgra.

Point-of-use, vertical storage/retrieval is working for Parker Hannifin. The greatest savings have been in eliminating the need for a plant expansion to accommodate a transferred manufacturing operation, says Birkenberger.

There also are substantial savings in indirect labor costs related to managing inventory, points out Bob McBride, business unit manager for the Forest City plant.

With the design of the VLMs, parts are always handled at a waist-high, ergonomically correct height. The shop floor and individual parts are cleaner now because parts are enclosed within the systems. Dust from corrugated containers previously used to hold parts has been eliminated.

The company has also substantially reduced the number of its forklift trucks, previously used in parts handling, which has further cut costs.

Parker Hannifin also is working with one large parts manufacturer to develop a program using returnable containers. Empty containers would be forwarded to vendors who would use them to ship parts back to the company. Turn-around time and expected usage would determine how many parts to keep in inventory.

Finally, the vertical storage/retrieval equipment, Birkenberger observes, could permit the assembly operation to move toward just-in-time deliveries from vendors. JIT operations would result in a further parts inventory reduction.