supply chain accelerated - archerpoint...in the mid 90’s - mid 2000’s wms was considered a....
TRANSCRIPT
Supply Chain Accelerated
Chris BarnesHighJumpSolution Consultant
TODAYS PRESENTER
AGENDA
Why WMSWMS Value DriversOther Considerations
Warehouse Advantage
SOLUTION COMPLEXITY /FUNCTIONALITY
WAREHOUSEUSERS
Enterprise / Tier 1
Hybrid /High Functionality 200+
Full-FeaturedHighJump
WMS
Configurable / HighFunctionality 5 - 250
Bar Coding / Data Collection
LowFunctionality 1-5
“Efficiency is doing the thing right.
Effe c tive ne ss is doing the right thing .”
Pe te r F. Drucke r
Warehouse Advantage
SOLUTION COMPLEXITY /FUNCTIONALITY
WAREHOUSEUSERS
Ente rp rise / Tie r 1
Hybrid /High Functionality 200+
Full-Fe ature dHighJump
WMS
Configurab le / HighFunctionality 5 - 250
Bar Cod ing / Data Colle c tion
LowFunctionality 1-5
Warehouse Advantage
SOLUTION COMPLEXITY /FUNCTIONALITY
WAREHOUSEUSERS
Ente rp rise / Tie r 1
Hybrid /High Functionality 200+
Full-Fe ature dHighJump
WMS
Configurab le / HighFunctionality 5 - 250
Bar Cod ing / Data Colle c tion
LowFunctionality 1-5
IN THE MID 90’S - MID 2000’S WMS WAS CONSIDERED A
Competitive Advantage
STATUS QUO IS NO LONGER AN OPTION.
IN THE MID 90’S - MID 2000’S WMS WAS CONSIDERED A
NOW WMS IS CONSIDERED BY SOME TO BE A
Cost of Doing Business.
Competitive Advantage
“We had to implement a WMS to keep our key customers.“
Director Distribution,Industrial Products Distributor
STATUS QUO IS NO LONGER AN OPTION.
10 @HighJumpInc
• Orde r volum e
• Inve ntory value
• Custom e r se rvice
• Accuracy
• Em ploye e turnove r
YOU MIGHT NEED A WMS IF…
• Order volume• Inventory value• Customer service• Order accuracy• Employee turnover
SpaceFull Time EquivalentsActive Dock DoorsSKUsLot/ Expiry/ SN
> 50,000 ft2
> 5
Yes
> 10
> 5,000
You Might Need a WMS if…
YOU MIGHT NEED A WMS IF…
Measure Z BP Median
On time shipments >= 99.8% 98.5%
Order picking accuracy >= 99.9% 99.50%
Location utilization >= 92% 85.0%
Annual Workforce Turnover < 0.8% 6.8%
On time ready to ship >= 99.9% 98.6%
Peak warehouse capacity used >= 100 97.0%
Fill rate – Line >= 99.8% 98.0%
Dock to stock cycle time < 2.3 hours 9.1 hours
Inventory count accuracy – bin >= 99.8% 98.5%
Fill rate – Order >= 99.83% 98.7%
DC Metrics Report, Dr. Karl Manrodt
KEY PERFORMANCE INDICATORS
Measure Z BP Median On time shipments >= 99.8% 98.5%
Order picking accuracy >= 99.9% 99.50%
Location utilization >= 92% 85.0%
Annual Workforce Turnover < 0.8% 6.8%
On time ready to ship >= 99.9% 98.6%
Peak warehouse capacity used >= 100 97.0%
Fill rate – Line >= 99.8% 98.0%
Dock to stock cycle time < 2.3 hours 9.1 hours
Inventory count accuracy – bin >= 99.8% 98.5%
Fill rate – Order >= 99.83% 98.7%
DC Metrics Report, Dr. Karl Manrodt
KEY PERFORMANCE INDICATORS
Measure Z BP Median On time shipments >= 99.8% 98.5%
Order picking accuracy >= 99.9% 99.50%
Location utilization >= 92% 85.0%
Annual Workforce Turnover < 0.8% 6.8%
On time ready to ship >= 99.9% 98.6%
Peak warehouse capacity used >= 100 97.0%
Fill rate – Line >= 99.8% 98.0%
Dock to stock cycle time < 2.3 hours 9.1 hours
Inventory count accuracy – bin >= 99.8% 98.5%
Fill rate – Order >= 99.83% 98.7%
DC Metrics Report, Dr. Karl Manrodt
KEY PERFORMANCE INDICATORS
Measure Z BP Median On time shipments >= 99.8% 98.5%
Order picking accuracy >= 99.9% 99.50%
Location utilization >= 92% 85.0%
Annual Workforce Turnover < 0.8% 6.8%
On time ready to ship >= 99.9% 98.6%
Peak warehouse capacity used >= 100 97.0%
Fill rate – Line >= 99.8% 98.0%
Dock to stock cycle time < 2.3 hours 9.1 hours
Inventory count accuracy – bin >= 99.8% 98.5%
Fill rate – Order >= 99.83% 98.7%
DC Metrics Report, Dr. Karl Manrodt
karl.m anrod [email protected] du
KEY PERFORMANCE INDICATORS
17
x 111,111,111=
12,345,678,987,654,321
111,111,111
SPEAKING OF NUMBERS…
PRIMARY BENEFITS
1. Im prove d Effic ie ncie s
2. Im prove d Custom e r Se rvice Le ve ls
3. Re al Tim e Acce ss to Inform ation
HARD AND SOFT DOLLARS
IntangibleTangible“On-time delivery performance improved to 97%. Our order accuracy went from 75% to 95%. We were very pleased with our results.“
VP IT, Industrial Products Manufacturer
• Real-time and accurate• Costs of Inaccurate Inventory:
- Poor Buying Practices- Processing Delays- Lost Sales- Excess Inventory- Low Productivity- Increased Freight Costs
IMPROVED INVENTORY ACCURACYExpect 99.9+%
50+% of the project benefits
• Direct & Indirect‒ Adding Value‒ System Direction‒ Eliminate Functions‒ Online Reports
• Administrative Savings
Reduced labor costs
by 20-30%IMPROVED LABOR PRODUCTIVITY
Storage20%
Receiving15%
Shipping15%
Order Picking50%
Source: Logistics Resources International, Inc.
Reduce inventory
search timeby 50-100%
0%
10%
20%
30%
40%
50%
60%
Travel Search Pick Other
Operator Time
IMPROVED LABOR PRODUCTIVITY
“The type of pick process you use is driven
by cost , handl ing characterist ics and order
prof ile.”
IMPROVED LABOR PRODUCTIVITY
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1 2 3 4 5 6-10 11-20 >20Lines Per Order
30% of Orders
are Single Line
75% of Orders are 5 or Fewer
Lines
IMPROVED LABOR PRODUCTIVITY
Type Description % of Orders
I Single Line, Single Unit 50%
II Large multi-line (100+) 35%
III Mid range multi unit 15%
IMPROVED LABOR PRODUCTIVITY
Discrete
IMPROVED LABOR PRODUCTIVITYIMPROVED LABOR PRODUCTIVITY
Batch Pick
IMPROVED LABOR PRODUCTIVITY
Cluster Pick
IMPROVED LABOR PRODUCTIVITY
IMPROVED LABOR PRODUCTIVITY
“We doubled our volumes with 25% fewer people.”
Director IT,Packaging Supplier
IMPROVED LABOR PRODUCTIVITY
Zone Pick
IMPROVED LABOR PRODUCTIVITY
Pre-post ing is the process of making certain the inventory is available in the bin prior to sending the operator to pick.
IMPROVED LABOR PRODUCTIVITY
Pre-rout ing is the process of mapping out the pick travel path to reduce wasted motion and travel during the pick tour.
IMPROVED LABOR PRODUCTIVITY
Grocery ListMilk
PicklesBreadEggsSoda
HighJump WMS
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Che
ck O
ut A
rea
Entra
nce
Grocery ListMilk
Pickle sBre adEggsSoda
HJ WMS
As-Is
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Che
ck O
ut A
rea
Entra
nce
Grocery ListMilk
Pickle sBre adEggsSoda
HJ WMS
As-Is
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Che
ck O
ut A
rea
Entra
nce
Grocery ListMilk
Pickle sBre adEggsSoda
HJ WMS
As-Is
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Che
ck O
ut A
rea
Entra
nce
Grocery ListMilk
Pickle sBre adEggsSoda
HJ WMS
As-Is
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Che
ck O
ut A
rea
Entra
nce
Grocery ListMilk
Pickle sBre adEggsSoda
HJ WMS
As-Is
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Che
ck O
ut A
rea
Entra
nce
Grocery ListMilk
Pickle sBre adEggsSoda
HJ WMS
As-Is
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Che
ck O
ut A
rea
Entra
nce
Grocery ListMilk
Pickle sBre adEggsSoda
HJ WMS
As-Is
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Che
ck O
ut A
rea
Entra
nce
Grocery ListMilk
Pickle sBre adEggsSoda
HJ WMS
As-Is
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Grocery List
Che
ck O
ut A
rea
Entra
nce
Pre- Routed
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Grocery ListSoda
Che
ck O
ut A
rea
Entra
nce
Pre- Routed
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Grocery List
Bre adSoda
Che
ck O
ut A
rea
Entra
nce
Pre- Routed
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Grocery List
Pickle sBre adSoda
Che
ck O
ut A
rea
Entra
nce
Pre- Routed
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Grocery List
Pickle sBre adSoda
HJ WMS
Che
ck O
ut A
rea
Entra
nce
Pre- Routed
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Grocery List
Milk
Pickle sBre adSoda
HJ WMS
Che
ck O
ut A
rea
Entra
nce
Pre- Routed
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Grocery List
Milk
Pickle sBre ad
Eggs
Soda
HJ WMS
Che
ck O
ut A
rea
Entra
nce
Pre- Routed
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
Grocery List
Milk
Pickle sBre ad
Eggs
Soda
HJ WMS
Che
ck O
ut A
rea
Entra
nce
Pre- Routed
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
IMPROVED LABOR PRODUCTIVITY– PRE ROUTE
“The process of ident ifying the most
ef f icient placement for each item in a
dist ribut ion center.”
IMPROVED LABOR PRODUCTIVITY– SLOTTING
IMPROVED LABOR PRODUCTIVITY– SLOTTING
• Improved pick product ivity• Bet ter pick accuracy• More ef f icient replenishment• Workload balancing• Ergonomics and safety
IMPROVED LABOR PRODUCTIVITY– SLOTTING
C = SlowB = Medium
A = Fast
Shipping
IMPROVED LABOR PRODUCTIVITY– SLOTTING
With the ABC slotting de sign the ory in m ind , what is the be st shape
of a ware house ?
IMPROVED LABOR PRODUCTIVITY– SLOTTING
A = FastB = Medium
C = Slow
C = Slow
C
B = Medium
B
A = Fast
ADocks
IMPROVED LABOR PRODUCTIVITY– SLOTTING
1,000 ft
Shipping
IMPROVED LABOR PRODUCTIVITY– SLOTTING
1,000 ft
500 ft
Travel w/o slotting = 1,000 ft
Shipping
(500 + 500) X 1.0
= average travel point w/o ABC
IMPROVED LABOR PRODUCTIVITY– SLOTTING
% of SKUS% Activity
% AreaA Items
208020
= average travel point using ABC
1,000 ft
Travel w/o slotting = 1,000 ft
Shipping200 ft
= average travel point w/o ABC
IMPROVED LABOR PRODUCTIVITY– SLOTTING
% of SKUS% Activity
% AreaA Items
208020
1,000 ft
100 ft
Travel w/o slotting = 1,000 ft
Shipping160 ft
(100 + 100) X .8
= average travel point using ABC= average travel point w/o ABC
IMPROVED LABOR PRODUCTIVITY– SLOTTING
% of SKUS% Activity
% Area
1,000 ft
B Items
301530
Travel w/o slotting = 1,000 ft
Shipping
A Items
208020
500 ft
= average travel point using ABC= average travel point w/o ABC
IMPROVED LABOR PRODUCTIVITY– SLOTTING
% of SKUS% Activity
% Area
1,000 ft
B Items
301540
Travel w/o slotting = 1,000 ft
Shipping
(350 + 350) X .15
105 ft
350 ft
A Items
208020
160 ft
= average travel point using ABC= average travel point w/o ABC
IMPROVED LABOR PRODUCTIVITY– SLOTTING
% of SKUS% Activity
% Area
1,000 ft
B Items
301540
Travel w/o slotting = 1,000 ft
Shipping
A Items
208020
C Items
505
10
750 ft
75 ft
(750 + 750) X .05
105 ft160 ft
= average travel point using ABC= average travel point w/o ABC
IMPROVED LABOR PRODUCTIVITY– SLOTTING
% of SKUS% Activity
% Area
1,000 ft
B Items
301540
Travel w/o slotting = 1,000 ft
Shipping
A Items
208020
C Items
505
10
750 ft
660 ft savings = $$$w/ slotting = 340 ft
75 ft105 ft160 ft
= average travel point using ABC= average travel point w/o ABC
IMPROVED LABOR PRODUCTIVITY– SLOTTING
IMPROVED LABOR PRODUCTIVITY– SLOTTING
IMPROVED LABOR PRODUCTIVITY– PUTAWAY
Labor Productivity
Im prove m e ntDire c te d Putaway
Sugge ste dBin
IMPROVED LABOR PRODUCTIVITY– PUTAWAY
Rec
eivi
ng
Secure
HazMat
Cold Storage
IMPROVED LABOR PRODUCTIVITY– PUTAWAY
IMPROVED LABOR PRODUCTIVITY– EDI
EDI is great for your custom e rs. But what
is it doing to your budge t?
IMPROVED LABOR PRODUCTIVITY– HANDS FREE
IMPROVED LABOR PRODUCTIVITY– EDI
Voice Picking vs. RF Scanning
• Can inventory be reduced?‒ Demand Variability‒ Lead Times‒ Lot Sizing‒ Corporate Policy‒ Other Projects
This could be a slippery slope.
Target15-30%
reductionINVENTORY REDUCTION
Target15-30%
reductionINVENTORY REDUCTION
CapitalCosts
INVENTORYCARRYING
COSTS
Inve ntoryRisk Costs
Storage Space Costs
Se rviceCosts
Inve ntory Inve stm e nt
Insurance
Taxe s
Plant Ware house sCom pany Owne d
Ware house s
Re nte d Ware house s
Public Ware house s
Obsole sce nce
Dam age
Pilfe rage
INVENTORY REDUCTION
Today Future
Improvement Program
Carrying Cost
Benefit
One Time Benef it
On-Going Benef it
Inve
ntor
y
Time
Inventory Reduction -
Working CapitalBenefit
INVENTORY REDUCTION
Improved inventory accuracy re sults in pote ntia lly be tte r inve ntory turns.
• Balance She e t Im pacts
• DC Shutdown
• Ove rtim e Labor
• De laye d Shipm e nts
ELIMINATE PHYSICAL INVENTORY COUNT
• WMS he lps you ge t it right the firs t tim e
• Are you be ing pe nalize d for m is-shipm e nts?
• Are you losing busine ss due to poor custom e r se rvice i.e . wrong ite m s shippe d?
Research indicates the typical error averaged $200 to correct on both the
shipping and receiving ends.
Expect Shipping Accuracy
up to 99.9%IMPROVED SHIPPING ACCURACY
Reduce Ship Sta tion
Re quire m e nts
SHIP ON MOBILE DEVICE
Release Ord e r X X
PICK TO SHIP LABEL
Stre am line d SLSU Parce l Shipp ing
• Be tte r space utiliza tion m ay de lay the ne e d for a fac ility e xpansion
• Re -ware housing can he lp fre e space by consolida ting partia l loads
• Be tte r p lanning and SKU inform ation will a llow for using d iffe re nt location size s
IMPROVED SPACE UTILIZATION
IMPROVED SPACE UTILIZATION
IMPROVED SPACE UTILIZATION
• Faster Order Throughput• Reduced Pick Errors• Bet ter Labor Ut il izat ion• Easier to Manage
Shipping
Bulk Over stock
Re ple nishm e nt
Days on Hand
Picking
Re se rve StorageZone
Forward PickZone
IMPROVED SPACE UTILIZATION
ForwardPick
Re se rveStorage
IMPROVED SPACE UTILIZATION
THANK YOU!
Sometimes, you just don’t
want to be out of stock…
THANK YOU!
THANK YOU!
THANK YOU!
THANK YOU!
THANK YOU!
THANK YOU!
Storage
Putaway
Receive Ship
Pick
Cross Dock
X XX
CROSS DOCK SAVES TIME AND SPACE
• Is the corre c t type of s torage e quipm e nt and m ate ria l hand ling e quipm e nt be ing use d ?
• Is e xce ssive space be ing consum e d to s tore and / or m ainta in e quipm e nt?
• Is your e quipm e nt p rope rly m ainta ine d?
EQUIPMENT
EQUIPMENTImprovement in equipment utilization can range from
5-20%
• Sale s
• De m urrage
• Expe d iting
• Pape rwork
OTHER TANGIBLE BENEFITS
• Pythagore an the ore m : 24 words
• The Lord's Prayer: 66 words• Archim e de s ' Princip le : 67 words
• The 10 Com m andm e nts: 179 words
• The Ge ttysburg Addre ss: 286 words
• The De clara tion of Inde pe nde nce : 1,300 words
• The US Government regulat ions on the sale of cabbage: 26,911 words
INTANGIBLE BENEFITS – More is no t a lw a ys b e t t e r
• Force d accuracy and se lf-che cking
• Data e ntry / ke ypunch e rrors
1 wrong key per 300 strokes
1 miss-read per
1,000,000 scans
REDUCED ERRORS
% Orders shipped on schedule
% of ordering periods not out of stock
% of line items shipped on schedule
% of total units shipped on schedule
WMS Impacts
• Pre-posting• Operator Directed Activities• Efficiently Managed Replenishment Process• Inventory Visibility• Workload Management• Order Planning• Shipping Lane Management• Parcel Manifesting Interface• Load Planning• Services Selling Point
Customer Service Level
CUSTOMER SERVICE IMPACTS
“It costs us approximately $600 per order error. And that is just the internal costs. When you add in the costs to our customers the number nearly doubles.“
VP Distribution,Auto Parts Aftermarket
KPIPivot Grids
Alerts
PERFORMANCE MEASUREMENT
WM
SSh
ipED
IERP
PERFORMANCE MEASUREMENT
PERFORMANCE MEASUREMENT
PERFORMANCE MEASUREMENT
– React ive– Proact ive– Mobil ity
PERFORMANCE MEASUREMENT
• Wave m anage m e nt p lans p roce ssing hours.
• Are bottle ne cks e xpe cte d base d on the fore cast?
• Eve ry transaction is re corde d ; “who, what, whe n and whe re ” of e ach ac tivity is known.
WORKLOAD MANAGEMENT
• Value Adde d Se rvice s
• Postpone m e nt
• Cross Docking
• Supply Chain Visib ility
• Supply Chain Eve nt Manage m e nt
SUPPORT OTHER INITIATIVES
• Share d Support
• Em ploye e Satisfac tion
• Misp lace d Orde rs
• Orde r Cycle Tim e
• Use r Ne tworking
“I like being able to tell the COO we can incorporate a new company into the operations.”
VP Ops School Supplies Distributor
OTHER INTANGIBLE BENEFITS
BE CAREFUL WHAT YOU ASK FOR
WMS may also help streamline the process for working with Amazon
Vendor Central…
WMS may also help streamline the process for working with Amazon
Vendor Central…
Collect Info
Vendor Portal
Print Labels
Search and Match ShipPick
Order
Collect Info
Vendor Portal
Print Labels
Search and Match ShipPick
Order
Pick & Apply
Vendor Portal
Print Labels ShipRun ACR
Report
Amazon Seller Fulfillment Prime
provides the benefits of selling through Amazon while leveraging your existing distribution
expertise and retaining additional margins.
Amazon Seller Fulfillment Prime
provides the benefits of selling through Amazon while leveraging your existing distribution
expertise and retaining additional margins.
AmazonCarriers, Rates, Labels
=Additional Labor
1. Select Buy Shipping2. Enter/update order shipping info3. Select best service type4. Select label format5. Buy and confirm shipping6. Download/print shipping label7. Find cartons and apply ship label
An integrated WMS and Shipping application can
streamline the Amazon Seller Central shipping workflow
CHARTING THE BENEFITS
Minimize B: Severity of performance drop-off during assimilation period –increase Proficiency
Minimize A: Duration of performance drop-off during assimilation period –Increase Speed of Adoption
Maximize C: Performance level after implementation – Ultimate Utilization
Maximize D: Continuous improvement
Engage E: Engage with stakeholders earlier to get a bump optimize project performance earlier – Transparency and Engagement
MANAGING EXPECTATIONS
IN SUMMARY – PRIMARY BENEFITS
1. Im prove d Effic ie ncie s
2. Im prove d Custom e r Se rvice Le ve ls
3. Re al Tim e Acce ss to Inform ation
CALL TO ACTION
Tim Baumgartner+1.708.287.4026 CT
Tim .Baum gartne r@highjum p.com
Chris Barne s+1.770 .331.3908 ET
Chris .Barne s@highjum p.com
QUESTIONS, CRITICISMS, OR CANNONBALLS
Arche rPoint+1.678.389.4283
info@arche rpoint.com
SYSTEM ARCHITECTURE
•ERP:‒ Planning‒ Finance‒ Purchasing‒ Orde rs‒ Ente rprise inve ntory
•HighJum p WMS‒ Exe cution
•Ce rtifie d da ta inte rface