<$MTBlogName$

Archives for October 2019

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:

Picture1z1

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.

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.

About Ian Hobkirk

Ian Hobkirk

Ian Hobkirk is the founder and Managing Director of Commonwealth Supply Chain Advisors. Over his 20-year career, he has helped hundreds of companies reduce their distribution labor costs, improve space utilization, and meet their customer service objectives. He has formed supply chain consulting organizations for two different systems integration firms, and managed the supply chain execution practice at The AberdeenGroup, a leading technology analyst firm.



Categories

Popular Tags

Subscribe to DC Velocity

Subscribe to DC Velocity Start your FREE subscription to DC Velocity!

Subscribe to DC Velocity
Renew
Go digital
International