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Warehouse Practices & Measures – You Put it Where???

Tuesday, December 31, 2019   (0 Comments)
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This is the fourth article in our ongoing series on warehouse processes and metrics from our Senior Analyst and Chief Process Auditor, Steve Murray. 

In this issue Steve discusses the processes involved in moving goods received forward to a stocking location or other destination using elements of the WERC Warehousing & Fulfillment Process Benchmark & Best Practices guide, our Annual DC Measures study, and his own field work.  Our goal is to help warehouse operators better understand process best practices and how to measure their impact. 

Previously Steve has discussed inbound visibility, delivery scheduling and management of receiving operations.  You can catch up by visiting the WERC Tip of the Month page at    https://werc.org/page/TipoftheMonth.

Once incoming shipments have been unloaded, verified and made ready (hopefully a very short processes with few activities) the next task is to move the materials to a put destination.  Typically this will be a storage location in a rack, on the floor or maybe in a yard.  Facilities with automated storage capabilities may move to a variety of AS/RS media including fixed aisle, carousels, shuttles, vertical lift modules, etc.  Other options could be to move materials directly to a production line or to cross-dock to a waiting outbound shipment.

The key to efficient material handling and putaway is to know where to put the stuff.  Ideally your systems will know or can logically determine the desired location and direct the warehouse associates (or their automated counterparts) to that precise location which will actually be able to contain the materials without the associate having to search for a place.

Many facilities use fixed locations for each product, some use a dynamic storage strategy where anything could be located anywhere it can fit.  By “fit” we mean not only is the location is large enough - but it is also the best location for the specific product based on weight and velocity of movement and other factors.  Some systems use a cartonization feature to calculate available space in a location or even in an already occupied location and determine if the incoming quantity can fit there.  We will dig into these concepts further in a later article on slotting. 

Best practice facilities employ directed putaway.  This model eliminates the age old task of having a warehouse associate troll the warehouse looking for an empty location or someplace the product was previously stored.  I often hear stories of how the long tenured employees have “worked here for years and simply know how to do their jobs”.  “Simply knows” is a misnomer, we think of it as “institutional Knowledge” and in today’s rapid turnover workforce setting is more a danger than an asset.  If you lack the technological capability to do dynamic directed putaway please develop a well-documented set of efficient tasks that can mirror that systematic automation through manual activities.

Associates should be able to directly move materials from the inbound staging area to a storage location with the least amount of effort in the least amount of time.  Systems used should provide guidance as discussed above either through a digital device like a scan-gun or worst case on a printed receiving putaway document.

It is imperative that data is entered accurately and timely.  Associates should confirm placement by scanning the item barcode and the location barcode, and confirm the quantity placed.  Hand writing locations and quantities on a receiving document which is later key-entered into a system is the single greatest cause of data inaccuracy.  The activity of key entering data can be 100% accurate, but the fact that it is not done until some minutes or hours after the actual placement creates inaccuracy between what the system knows and what is real.

The impact of inaccurate data will be seen during subsequent putaways, in inventory count variances, and during pick activities when the items are not available at an assigned pick location.  How many times have your putaway and pick associates been forced to alter course due to inaccurate or untimely data?  How often do cycle counters waste time trying to determine why the bin quantity is different due to delayed put or pick transactions?

Any situations which require an “override” to the directed location/quantity indicate a fault in the putaway location assignment logic or the inventory data in the system.  These faults should be immediately communicated to a lead or manager.  They should be analyzed and corrections made to the systems and/or processes to reduce the possibility of re-occurrence.

Warehouse managers should focus on improving the speed and accuracy of the inbound process from unload through putaway by cutting down on the “fingerprints and footprints” – the number of times touched and the distance moved. 

Opinion:  The inbound processes from visibility through putaway have a much greater impact on filling customer orders than most give credit to. 

Efficient facilities work to eliminate time spent re-labeling inbound product, eliminate time spent trolling aisles to putaway, eliminate location over-rides, and focus on 100% data accuracy. 

Best practice facilities use digital devices with scanners or voice have human interfaces which minimize the number of key presses or words necessary to record a transaction in real time.

Best practice facilities use system that can direct material movement without guesswork on the part of the associate.  If the system says “put it there” it gets put wherever there is virtually 100% of the time.

Best practice facilities coordinate deliveries and outbound shipments through cross-docking to support reduced handling and movement in the effort to meet the ever growing need to balance lean inventories with ultra-fast delivery (the “X-day” requirement). 

Metrics that are typically used to measure putaway effectiveness include:

  • Percent of delivered lines requiring internal label creation

  • Lines Received and Put Away Per Hour

  • Dock to Stock Cycle Time  (total elapsed time from start of unload to placement in putaway location)

  • % of orders cross-docked
  • % of putaway tasks that require a location over-ride

  • % of Inventory Count Variance incidents

  • % of Pick shortage incidents

Note:  The last 3 measures may also result from move/re-supply or pick errors.  When capturing these metrics you should include enough details to allow for analysis and follow-up to correct any problems with processes, technology and training.

WERC’s Annual DC Measures study provides a way for warehouse operators to compare many of their own metrics to those of their peers and the Best Practice guide can help by showing actions that impact those measures. 

WERC believes that excellent KPIs are the result of excellent processes, and by improving your processes you will improve your results.

Now that the deliveries have been unloaded and verified we can begin to put them into their storage locations.  Putaway will be the subject of next month’s Tip.