Warehousing’s historical core responsibility has been the storage of goods. However, the scope and core responsibilities of warehouse operations have evolved to deliver high level inventory management, swift receiving & shipping dock management, accurate and flexible customized pick & pack services, and state of the art storing and safekeeping solutions for all the goods.
Best practice warehouse operations enable companies to meet the strategic delivery needs by improving materials flow, order pick & pack, replenishment, dock operations and maintenance of a swift information flow from source to delivery point, thus facilitating the coordination of the entire supply chain to get purchased materials in the right way, to the right place, and in the exact time they are expected by the next link in the supply chain up to and including the final consumer.
Because of the development of an increasingly integrated global economy market with production facilities scattered around the globe, warehouse operations are becoming the key factor to cope with demand variations, and inventory management is a critical component of a company’s financial performance, warehousing has become a vital cog within supply chains because it holds so much potential for improving lead time and cost reductions.
The biggest challenge on today’s warehouse managers is to increase productivity and accuracy, reduce cost and inventory while improving customer satisfaction, which ultimately means, optimized goods rotation, less frozen capital and efficient use of all the resources assigned.
In an integrated supply chain environment, where often enough warehousing is considered as a non-value adding activity, applying Lean can ensure the company has the right visibility of the value-adding activities carried out at the warehouse in order to gain a competitive edge by:
Waste in warehousing processes represents tremendous savings potentials and thus it should and can, using the right Lean tools, be identified and minimized. While in most warehouse operations picking activities generate more than 55% of the costs, Lean principles, kaizen methods, and reengineering approaches can be applied in every step of warehouse operations. The right Lean Solutions can improve product quality, reduce lead-time and reduce working capital.
Designing and implementing Lean warehouse operations can have a great impact on the total supply chain output. By approaching the waste focus areas mentioned above with Lean solutions, some of the opportunities that come up to reduce lead times in warehousing include:
We implement Lean Solutions to warehouse operations. The solutions must fit the challenges.
|Warehouse Lean project reduced the actual processing time of picking and packing by 50%, thereby shortening the total lead time by 25%|
|Optimizing the warehouse layout reduced storing times by more than 25% and picking times by 30%|
|Lean warehouse to dispatch workshop improved dock scheduling and loading plans which improved filling rates of transports and a reduction in truck loading hours needed, reducing the lead time between 10% to 30% varying on the different SKU categories|
|Lean picking workshop resulted in a decrease of picking mistakes by more than 90% due the to the standardization of the picking process and its interfaces with the order generation and invoicing processes|
|Optimized handling approaches and Lean ERP systems impacted a decrease of picking and shipping mistakes by ~40%|
|Optimizing cartons filling rate decreased the buying needs by 46% and lead to a reduction of 18% in transportation costs while reducing environmental impact|
|Inventory accuracy improvements due to optimization and linking of ordering, data entry and inventory management processes resulted in a reduction of 20% of inventory required to support a growth strategy|
To learn more about Lean warehouse operations solutions, contact Four Principles today.