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OVER-Train Staff for Warehouse Automation Success

By Ian Hobkirk | 11/27/2019 | 9:19 AM

Most companies that have attempted to implement automated materials handling equipment have discovered that these projects can be particularly vulnerable to Murphy’s Law, the principal that, “anything that can go wrong, will go wrong.” This blog is twelfth in an ongoing series on “Beating Murphy’s Law in Warehouse Automation Projects.”

Blog 14 DCWhen it comes to operator training, there’s no such thing as too much. It can be inconvenient and costly to take operators away from their duties to train them on new processes, but it is important to remember that training will happen – it will either be in a controlled fashion, ahead of the deployment, or chaotically in the heat of the go-live.

Project leaders and engineers may find it easy to underestimate the degree to which new processes and technology must be clearly laid out to the those who must actually use them. The key project stakeholders may have been living and breathing these changes for over a year prior to deployment, as new processes are designed, built, and tested. Many times, however, the system operators themselves are only exposed to the new processes in the immediate lead-up to the implementation. It may take them longer than expected to embrace the new ways of working, and they may not readily admit when they do not understand aspects of the new workflows. Murphy’s Curve cannot be eliminated, but relentlessly training, testing, and re-training can make it as shallow and short as possible.

Warehouse Automation Projects: Don't Forget Inbound Processes!

By Ian Hobkirk | 11/21/2019 | 5:40 AM

Most companies that have attempted to implement automated materials handling equipment have discovered that these projects can be particularly vulnerable to Murphy’s Law, the principal that, “anything that can go wrong, will go wrong.” This blog is twelfth in an ongoing series on “Beating Murphy’s Law in Warehouse Automation Projects.”

Blog 13 DCOn warehouse automation projects, the outbound processes of picking, packing, and shipping often receive a disproportionate degree of attention during the design process, to the exclusion of inbound processes like receiving, put-away, and bin replenishment. Companies often reason that, because failure to ship product can put them out of business quickly, all resources must be focused on this area, and that somehow the replenishment process will “figure itself out.”

While it is true that problems with outbound processes can negatively impact the operation in immediate and direct ways (orders don’t ship), inbound problems may be slower to manifest themselves, but every bit as serious to the operation. Many material handling systems appear to go live successfully at first, with just “a few minor problems” putting away product and replenishing the forward pick areas. However, as these “minor problems” build up, they can eventually cripple an operation over time as each day, more and more pickers arrive at bins that do not have enough product to fill their orders. More and more labor must be dedicated to getting product in the right pick faces, or inefficiently performing picks from reserve locations. Often, when trying to quickly stock bins to get product out the door, workers may take short-cuts and make product moves without taking the time to record them in the WMS system. This creates another insidious problem as inventory accuracy begins to drop, making the WMS incrementally less able to effectively trigger replenishment tasks. The impact of inbound flow problems is less immediate, but just as consequential as outbound problems.

Matrix content from Stephen Covey’s Seven Habits of Highly Successful People

 

This inattention to inbound processes is a classic case of failing to focus on areas of the design that are “important, but not urgent,” known as the “Quadrant 2” tasks, a term coined by author Stephen Covey in The Seven Habits of Highly Effective People. If “important, but not urgent” areas are ignored long enough, they become critically urgent and can potentially sink a project.

 

The remedy to this situation is to insist on rigorous design and discussion around the receiving, put-away, replenishment, and slotting processes at all design meetings. The rules for system-directed put-away must be thoroughly defined:

  • How will the WMS or WCS know if newly arrived product will be able to fit in the desired bin location?
  • Will bins that already contain product be “topped-off”, or should new product always be put in empty bins only?
  • If newly-arrived product is put-away in overstock locations as a rule, what should happen if the forward pick location is empty?  Should new products be put there first?
  • How will the WMS system manage these rules and execute this strategy?

 

Attention should also be given to bin replenishment:

  • What will be the replenishment triggers?
  • Will minimum and maximum stocking levels be defined for each product in each forward pick bin?
  • How precise will these rules be?
  • What happens if a SKU is re-slotted in a different forward-pick storage medium?
  • How will the min/max quantities be calculated?
  • What will be the specific trigger for min/max bin replenishment?
  • Will the trigger occur as soon as product is allocated from a bin that will deplete it below the minimum level?
  • Can bins be proactively replenished prior to product being allocated and waved to orders?
  • Will pickers only be sent to bins when it is known that there is sufficient product to fill the demand to avoid a random, first come/first served allocation in short stock situations?
  • What will happen if a replenishment takes place before the bin is depleted and the newly arrived product will not fit in the bin?  Where will the product be placed?
  • Can a certain percentage of bins be intentionally left empty to accommodate these situations?
  • How much labor will be required to replenish bins each day?
  • How much additional labor will be required to get through the “Murphy’s Curve” period of reduced productivity?
  • Has this labor been obtained and trained?
  • How will replenishment tasks be measured and managed-to, each day?

 

Slotting rules and data integrity are also key topics to address:

  • What rules will be used to slot the forward pick locations?
  • Will slotting be based upon sales velocity, SKU affinity, segregation, family groupings, or other criteria?
  • What system will manage these rules and suggest the optimal bin location for each SKU?
  • How will this information be relayed to the WMS or WCS during put-away and replenishment tasks?
  • What will be done to remediate data errors as they are encountered?
  • If a replenishment worker is unable to fit all the product in the bin as expected, is there a defined resolution path where the situation can be investigated, and can corrections be made to master data expeditiously?

 

By giving thorough attention to these and other issues during the Design Engineering period, companies can help ensure a harmonious flow of materials in the distribution center in both inbound and outbound directions.

Warehouse Automation Projects: Don't cut corners with slotting!

By Ian Hobkirk | 11/12/2019 | 6:05 AM

Most companies that have attempted to implement automated materials handling equipment have discovered that these projects can be particularly vulnerable to Murphy’s Law, the principal that, “anything that can go wrong, will go wrong.” This blog is twelfth in an ongoing series on “Beating Murphy’s Law in Warehouse Automation Projects.”

Blog 12 DCA key design area that can cause problems with material handling system implementations is that of bin slotting: determining the optimal location for each SKU in the system. There are two basic approaches which can be taken to bin slotting: (a) using spreadsheet-based tools, and (b) using commercially developed, specialized slotting software. Each approach can be effective in certain situations.

Spreadsheet tools can often be used to perform very accurate bin sizing. This step is crucial as the final storage mediums are designed, and shelf spacing is set during implementation. Improper bin sizing can result in bins which are too large (creating wasted space and excessive travel), or too small (creating product overflows and excessive replenishment labor). Incorrect bin sizing is usually caused by either (a) faulty master data, or (b) shortcomings in the calculation methodology. Errors in master data can often be caught by having individuals who are knowledgeable of the business review the data, investigate outlying data points with a critical eye, and look for results which do not intuitively seem right. Conversely, errors in calculation methodology can often be remedied by having individuals experienced in slotting processes create the slotting tool using proven methods.

Many companies have found it beneficial to utilize a commercial slotting software system. Commercial slotting tools surpass the capabilities of spreadsheets in a number of ways:

  • Pre-coded calculations and rules that have been battle-tested in numerous applications
  • Ability to perform more complex slotting using multiple criteria, including:
    • Sales velocity
    • SKU affinity
    • Family groupings
    • Segregation rules
    • Ability to interface directly with a WMS system to trigger product moves and manage directed put-away

While commercial slotting tools are not inexpensive, they can often prove to be a wise investment. In the chaos of a system implementation, it can be difficult to rapidly correct slotting mistakes on the fly; far better to avoid making them to begin with by investing in a rigorous slotting program from day one.
To read Commonwealth’s complete white-paper titled, Beating Murphy’s Law in Warehouse Automation Projectsclick here.

 

Using Simulation on Warehouse Automation Projects

By Ian Hobkirk | 11/05/2019 | 9:01 AM

Most companies that have attempted to implement automated materials handling equipment have discovered that these projects can be particularly vulnerable to Murphy’s Law, the principal that, “anything that can go wrong, will go wrong.” This blog is eleventh in an ongoing series on “Beating Murphy’s Law in Warehouse Automation Projects.”

Blog 11 DCOne key way to mitigate risk is to spend “Smart Money" on key technologies like system simulation.

Simulation software differs from other forms of data modeling in some significant ways. Simulation software allows actual material handling equipment to be built with defined performance parameters and logic models, which simulate the decisions that are made by the controls software as various inputs are received. Graphical layouts are created which show what the equipment looks like in 3D renderings. Both mechanical as well as human work rates can be defined and modeled. A material handling system can be virtually “built”, and the software can simulate the picking, packing, and shipping of actual sales orders both by human and mechanized processes. Some of the key questions that simulation software can often answer include:

 

  • How will the system respond if last Wednesday’s sales orders were processed through it?
  • How would the system respond if the orders from the busiest day last year were processed through it?
  • What bottlenecks exist in the system?
  • What would happen if a key component in the system failed?
  • What if we grouped orders in batches like this?  How quickly can the system process them?
  • If we don’t have the labor perfectly balanced across zones, what level of labor imbalance will make the system choke?
  • What happens if the shipping area falls behind for “x” minutes?  At what point does the system back up and shut down the picking area?
  • Will it be possible to replenish the system quickly enough without interfering with picking?
  • What if the average lines per order drops from three to two?  How will this impact the system throughput?

 

In complex material handling systems, simulations can identify design flaws in ways that no other modeling tools can. Unfortunately, simulations can be very costly and time-consuming to build. Many companies choose not to have a simulation performed in an effort to save money or preserve the project timetable. However, buyers would do well to consider the time and cost of rectifying a design flaw after a system has been built and installed.

 

Sometimes companies choose to have their material handling equipment provider perform a simulation of the system. However, purchasers should consider that equipment providers are not always the best source for this form of critical design validation. It can often be more effective to have an independent, third party perform the simulation, if for no other reason than to review the design with a “fresh set of eyes.” Many independent consulting firms can perform material handling simulations free from any desire to sell equipment, or any pride of authorship in the design which could inadvertently bias the results.

 

Spending “Smart Money” on Warehouse Automation Projects

By Ian Hobkirk | 10/30/2019 | 7:01 AM

Most companies that have attempted to implement automated materials handling equipment have discovered that these projects can be particularly vulnerable to Murphy’s Law, the principal that, “anything that can go wrong, will go wrong.” This blog is tenth in an ongoing series on “Beating Murphy’s Law in Warehouse Automation Projects.”

DC Blog 10While Murphy’s Curve cannot be entirely eliminated, having the “right” design to begin with can be a major step towards ensuring that the curve is shallow and short. In most cases, the system design is only truly finalized once a vendor is chosen, and that vendor performs their internal detailed design engineering process. When this design is complete, the company purchasing the system is presented with a set of drawings and design specifications to approve for production. So how does the purchaser know that the vendor’s design is “right”?

Reviewing the design parameters and rationale is a good first step toward understanding the system’s capabilities and the vendors line of reasoning when developing the design. In simpler systems, reviewing these data models in spreadsheets may be sufficient to ensure that the design will meet the operational needs. However, in more complex systems, it may not be possible to thoroughly model all of the ways in which the system will operate using even the most sophisticated of spreadsheets.

For these more complex designs, companies do well to consider investing in two key technologies which can help ensure that the design is truly optimized around their business needs:  simulation technology and slotting software. These are the subject of our next two blogs, stay tuned!

Select Partners Wisely on Warehouse Automation Projects

By Ian Hobkirk | 10/23/2019 | 7:21 AM

Most companies that have attempted to implement automated material handling equipment have discovered that these projects can be particularly vulnerable to Murphy’s Law, the principal that, “anything that can go wrong, will go wrong.” This blog is ninth in an ongoing series on “Beating Murphy’s Law in Warehouse Automation Projects.”

Blog 9 DCThe best designs and project plans can still fail in the hands of the wrong vendors implementing the project. Companies do well to conduct a thorough vendor selection process to ensure that the companies they partner with are those best equipped to meet their needs.

Some key mistakes companies often make when it comes to vendor selection include:

  • Love at first sight: Some companies irrationally latch on to certain technologies, which they may have seen at trade shows or site tours, believing it must be the right choice for their company absent of any objective evidence.

    Many of the forms of warehouse automation in use today can be impressive to observe and have in fact transformed many operations for the better. But, as pointed out in earlier sections, each distribution center is a unique “snowflake” with specific requirements that differ from other sites. Technology that works well in one distribution center may be the wrong choice for another facility – even one in the same industry. There is no substitute for an objective design process based on empirical data modeling and broad perspective on the solutions that actually work in the real world.

  • The lowest price wins: Companies are right to seek competitive pricing from their vendor partners, but many make the mistake of prioritizing price above all else. This may be a valid strategy for less automated solutions, such as static storage equipment and vehicle-based picking systems, where the products in question have become commoditized. In these cases, product designs are often fairly standard and minimal custom-engineering must take place. Simpler equipment can often be well-described in detailed functional specifications, and if bidders adhere to these specifications, then a strong case can be made that the lowest-price vendor should be awarded the contract.

    However, for more complex systems, the lowest-price vendor may not always be the best choice. When systems are highly complex and difficult to fully describe in a written specification, then there is often a large potential for vendors to cut corners in ways that are not initially evident. Additionally, the success of complex automated systems often lies in the ability of the vendor to understand the unique operational requirements and engineer a custom solution for the client.

    Often, the low-price bidder may not have invested as heavily in their engineering staff or quoted the same number of man-hours as other bidders who have taken a more thorough approach. Many times, by over-emphasizing price as a decision criterion, companies unwittingly pressure even responsible vendors to cut corners and omit key design features, which may prove critical to the success of the system.

    Often, a low price that seems too good to be true can mean the vendor has under-staffed the project, and the customer can be forced to take on a larger share of project implementation responsibilities than they are able to easily handle. Key implementation responsibilities may be forced on the customer’s internal staff, who may or may not be prepared to play these enhanced roles. Companies should instead take a balanced view where system price is one of several design criteria, and not necessarily the most important one.

  • The familiar company wins: Many companies make the mistake of using a vendor that may be familiar to them, but not well qualified to undertake the present project. Certainly, there is value to working with partners who have a solid, proven track record of executing on past projects. However, companies do well to ask themselves whether they have taken an honest look at the “familiar” company’s qualifications and track record of designing and implementing the specific technology in question, for the current initiative.

Companies implementing warehouse automation should instead take a well-rounded approach and conduct a thorough request for proposal (RFP) process that evaluates the following criteria:

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Warehouse Automation: Value the Gray Hairs!

By Ian Hobkirk | 10/15/2019 | 7:15 AM

Most companies that have attempted to implement automated material handling equipment have discovered that these projects can be particularly vulnerable to Murphy’s Law, the principal that, “anything that can go wrong, will go wrong.” This blog is eighth in an ongoing series on “Beating Murphy’s Law in Warehouse Automation Projects.”

Blog 8 DCWhile it may be impossible to forecast everything that could go wrong on a project, experienced project leaders, who have implemented similar technology numerous times before, can usually do a better job of anticipating the likely problem areas than can individuals who are working on their first project of this kind. Veterans are far less likely to minimize the risks of going live too soon and can often temper the desire to finish “on time” with the need for the system to work properly.

The value of having a project leader who has implemented similar technology many times in the past cannot be overstated.

It may be possible to hire such a resource as a company employee, and have that individual then transition to an operational role once the project is over. Some companies have found that it is more practical to use an external consultant in this role. Many consultants have transitioned from one warehouse automation project to the next over a period of two to three decades, giving them vastly more project experience than an operations leader who may have only gone through the warehouse automation cycle a few times. Automation consultants can bring targeted experience to the project during a defined period without having to stay on the payroll once the system is running and stabilized.

Warehouse Automation: The Value of PHASED Implementation

By Ian Hobkirk | 10/08/2019 | 11:27 AM

Most companies that have attempted to implement automated material handling equipment have discovered that these projects can be particularly vulnerable to Murphy’s Law, the principal that, “anything that can go wrong, will go wrong.” This blog is seventh in an ongoing series on “Beating Murphy’s Law in Warehouse Automation Projects.”

Blog 7 DCDepending on the nature of the design, it may be possible to implement project in phases, rather than all at once. This is especially true if
the project involves relocation to a new distribution center. If there is more space available than is necessary on day-one, it may be possible to relocate the operation to the new building and initially begin filling orders using manual processes. Then, once the company has settled into the new site and new employees have been trained and are proficient, the more automated phases of the technology can be installed. Another way to deploy in phases involves installing all of the new technology but using more basic pick methodologies at first until the technology stabilizes and workers get familiar with new processes. For example, workers might initially only pick one order at a time before later transitioning into a more complex cluster picking process.

In either example, while some of the full benefits of the new technology may be slightly delayed, the risk of the organization choking on too much change, too fast, is greatly reduced.

Warehouse Automation: Don't Launch the Ship in a Hurricane!

By Ian Hobkirk | 10/01/2019 | 5:51 AM

Most companies that have attempted to implement automated material handling equipment have discovered that these projects can be particularly vulnerable to Murphy’s Law, the principal that, “anything that can go wrong, will go wrong.” This blog is sixth in an ongoing series on “Beating Murphy’s Law in Warehouse Automation Projects.”

Blog 6 DCMany companies make the mistake of going live with a new project either during - or immediately before - a peak demand period. For companies in the retail or consumer goods sector, each year can bring greater seasonal surges as consumers increasingly align buying habits around “Black Friday” or “Cyber Monday” promotions during the year-end holidays. These events can mean demand surges of more than ten times normal volumes. While companies may view the new system as vital to helping the company survive the next busy season, deploying poorly tested technology at the height of the busy season is a recipe for a shipwreck.

To avoid this, companies should plan to deploy new warehouse automation as far in advance of the peak period as possible and have a contingency plan in place if the project is delayed (as noted previously). It may be possible to rent additional space where orders can be manually picked for a period of time during the busy season, using temporary workers. This option may not be inexpensive, but it is likely preferable to being forced to go-live with an unready system.

Ultimately, the company should make an honest “go/no go” decision well in advance of the busy season and have a “Plan B” to delay the go-live until after the busy season, if needed.

Managing the Calendar on Warehouse Automation Projects

By Ian Hobkirk | 09/24/2019 | 5:25 AM

Most companies that have attempted to implement automated material handling equipment have discovered that these projects can be particularly vulnerable to Murphy’s Law, the principal that, “anything that can go wrong, will go wrong.” This blog is fifth in an ongoing series on “Beating Murphy’s Law in Warehouse Automation Projects.”

Blog 5 DC 350Many companies set themselves up for failure early on by committing to an unmovable deadline for completing the project. The most common reasons for this are:

  • Facility exits: The timeline is based around a date when the company must exit an existing facility
  • Seasonality: The timeline is based on the need to have the system operational in time for a peak period (often around the Christmas holiday season).
  • 3PL contract expiration: The timeline is based on transitioning away from a third-party logistics provider on a certain date.

The deadline may be set far enough in advance that the company believes it is easily attainable. Then, Murphy’s Law begins to play out, and the timeline is extended by unforeseen circumstances. Faced with the seemingly unmovable deadline, the company then marches inexorably towards a go-live date that becomes more and more risky with each passing day. Executives issue ultimatums. Project managers are offered carrots or threatened with sticks based on achieving the timetable. Key stakeholders feel increasing pressure to “launch the boat” while workers are still patching up holes in the hull.

All of these pressures often cause the project leaders to decide to move forward with the go-live, even though all the indications are that the technology is not yet fully tested and ready- sometimes with catastrophic results. Executives may fear the impact of a delayed launch, but be blind to the far greater consequences of a premature, failed launch (remember, it’s too late to bring the boat back to the shipyard after it’s sunk to the bottom of the harbor!).

So, what can be done to resist this pressure for a premature go-live?

  • Estimate the timetable accurately: To begin with, project planners should research the actual time it will take to complete the project.
  • Don’t ignore design and vendor selection time: Companies often under-estimate the time it will take to fully design the system and conduct a thorough vendor selection process (these two steps alone can take six months or more on complex material handling systems).
  • Approvals always take longer than expected: Executive approvals for capital-intense warehouse automation projects are rarely  Blog 5 excerpt4x-100obtained in a matter of days, even at small companies with streamlined decision-making processes. Obtaining capital request approvals, negotiating details of contracts, and performing legal reviews can take weeks or months- not days. This process is often repeated multiple times: once for the overall project budget approval and again each time large vendor contracts are to be executed. Time for this should be built into the timetable from the beginning.
  • Manufacturing lead times can change: In busier economic periods, 
    manufacturing lead times can be much longer than in slower times. Don’t assume that vendors can manufacture equipment as quickly as they may have done during the last project you worked on. Get updated manufacturing time estimates prior to presenting any project timetable to the management team.
  • Add contingency time: Remember, it is usually difficult or impossible to anticipate when Murphy’s Law will strike. Add contingency time to the project schedule, even if the weather seems good and it looks like clear sailing ahead.
  • Have a backup plan to extend the deadline: In most of the scenarios cited above (facility exits, peak periods, 3PL contract expirations), the deadline is often not truly “unmovable”. Lease extensions can be negotiated, penalty clauses can be enacted and paid, overflow facilities and temporary labor can be hired to survive peak periods, and 3PL contracts can be renegotiated. While all of these alternatives can be costly, they may be vastly less expensive than having a failed project with product unable to ship. Additionally, if the backup plan is developed early enough, it may be possible to negotiate more favorable terms than if the discussions are held at the last minute under emergency circumstances.

 

 

 

The opinions expressed herein are those solely of the participants, and do not necessarily represent the views of Agile Business Media, LLC., its properties or its employees.



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