WHY DISTRIBUTION CENTRE’S SEAMLESS WORK FLOW MANAGEMENT IS CREITICAL TO SUPPLY CHAIN SUCCESS?
Ajith Watukara - MBA, BSc - MASCI-Australia - CCMP-USA
Global Supply Chain Leader - Transformation & Operations | Lean Management Experts | Certified Digital Transformation Catalyst | Six Sigma Master Black Belt | Corporate Adviser & Trainer | Recruiter
Warehouse material flows and seamless work flow respond?to one of its?basic characteristics,?since?products stay?temporarily inside a?warehouse?and everything that enters the installation?must exit.
This flow in a warehouse can be simple or complex, depending on each company, the degree of?automated systems, the in-house operations carried out with the goods, the quantity there is of it and the way it is?moved.
The different material flows can be illustrated through simple flowcharts or flow diagrams.
Types of Work flows?
Flows are the movements of the units as they enter the warehouse, move around it, and finally exit.
To understand how these movements work, we can examine the simplest possible flow, which takes place when units sent by the supplier are used, without dividing these up.
Movements start to become more complex with this type of flow. It is normally found in warehouses with single or combined picking operations, generally with the supply of full pallets.
There are warehouses with different working areas, depending on the types of product and their consumption. They normally have intermediate handling areas and can require various operations that in turn need flows of a certain (and at times great) complexity.
This diagram shows an example of this type of facility and the loading movements that occur there.
Each flow added to the working system represents an additional cost when it comes to calculating the overall cost of the process within the warehouse. The greater the division of the unit loads, the greater the impact on costs.?
Picking operations account for the largest proportion of the total warehouse costs?(up to more than 60%).?This is why the design of these areas is of such importance.
In addition, the larger the warehouse, the further the handling machines and personnel have to travel and the greater the final cost of the operation.
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In centres with a great deal of movement, it is worth analyzing the possibility of introducing automation, so the product goes to the person?rather than the person?going to the product.
As is to be expected, the location of items depending?on their consumption and volume is basic. The closer the high demand or large goods are to the loading and unloading docks, the lower the handling costs.
A good example is a warehouse where loose units are directly prepared. As explained in the?discussion on?unit loads, a single pallet can contain hundreds of sales units.?
Therefore.?By moving these in a single operation it is possible to avoid the hundreds of movements that would otherwise be required to prepare each individual loose item.
Product rotation: A-B-C:
Another decisive factor that influences the speed and cost of operations is demand for the product or good. This is why items in most demand must be close to the loading and unloading docks. To this end, the concept of rotation?is used. Products are classified as described below, according to their consumption:
A.?High rotation:?Units enter and exit continuously. These items are in high demand.
B.?Medium rotation:?Units enter and exit in smaller volumes than in A.
C.?Low rotation:?These are the items that spend the most time in the warehouse, and are in low demand.
In most warehouses, the 80/20 rule or Pareto Chart applies.?According to this rule, 80% of sales can be attributed to 20% of the products, while the remaining 20% of sales come from the remaining 80% of products.
Obviously, the flow of materials has to be treated differently according to the?rotation?in question?( A, B, or C). Below it?illustrates two examples of possible criteria to apply:
Conclusion:
As you can see, warehousing and distribution play a vital role in supply chain management. If these two aspects of the supply chain are not managed effectively, the success of the entire process can be put at risk.
But unfortunately this universal truth underestimated and under-realized in some business context.
All businesses depend on warehousing facilities to ensure that their goods are stored safely and securely and that their orders are fulfilled accurately and on time. So, selecting the right warehouse service for your business is crucial.