As you study your warehousing operations, you should be able to identify every activity that absorb resources without creating additional value. The question that you all should ask to yourselves is how much more profitable could the warehouse be if we eliminated the errors or waste from the processes?
Poor utilization of space is a kind of waste. Space is money and it is paid for every month. If extra space is acquired when the existing warehouses are not utilized effectively, the waste is obvious.
Although staging of product at the shipping and receiving docks is accepted as a necessity today, could it be eliminated? Since warehousing is nothing more than the management of space and time, reducing waste starts with identifying the poor use of both.
Lean warehousing is the elimination of wasted space and wasted time with a systematic approach. It includes,
- Improved flow of material
- Better utilization of available cubic space
- Creation of perfect orders.
A warehouse adds value of time, place and quantity that is not available from the manufacturer or supplier. Most warehouses receive large, infrequent loads and deliver smaller loads more frequently.
Focus on FLOW
Material flow (MF) is the description of the transportation of raw materials, pre-fabricates, parts, components, integrated objects and finally products as a flow of entities.
Benefits after optimization of material flow
Purchasing cost will decrease
Quality of product will increase
Manufacturing waste will decrease
Production will increase
Product cost will decrease
Customer satisfaction will increase
“10 Golden Rules of Storage”
- Search free
- Count free
- Air free
- Bend free
- Climb free
2 Hygiene Factors
- Well lighted
- Well Ventilated
3 Good Practices
- First in First Out
- Point of Use storage
- Heavy & tall Items on bottom of shelves
Opportunities for improvement in warehouse
- Order booking Process
- Order receipt & entry process
- Order picking process
- Truck loading process
- Goods receipt process
- Defective Goods Management Process
- Returned Goods management process
- Non Moving & Slow Moving Management Process
- Excessive Transportation, Motion & searching of Goods in Storage
- Storage Methods are Floor Based
- Stock Outs & Loss of Sales
Warehouse is a part of supply chain
If we improve warehouse stand alone
- We will get substantial, but sub optimal benefits
- Sustainability will be tough
Lean thinking will require a conversion from top-down leadership to bottom-up initiatives.