Applying Lean Thinking in the WAREHOUSE

Applying Lean Thinking in the WAREHOUSE

The concept of Lean has roots in mass production, originally in the automotive industry, and most famously, at Toyota. But changes in manufacturing & service industry, along with globalization are creating new challenges for warehouse management. Allowing stock to sit on shelves or store and waiting for an order is no longer a standard procedure.

Many world class organizations have started applying Lean thinking in the warehouse.


  • Observe “Reality at Gemba” & evaluation against Five S & Lean Warehouse.
  • To understand the material flow in warehouse (Inbound & Outbound)

Part 1: Warehouse Observations

Typical Warehouse Information


- xx Site Manager

- xx Operations Manager

- xx Supervisors

- xx Team Leaders & Workmen

Warehouse Area:

- x sqft Closed space

- x sqft Open space

Average Daily Load:

- x inbound trucks, containers

- x outbound trucks

Material Handling:

- x Hand pallet trucks

- x Fork lift

- Material pallets

- Conventional racks

- x loading/unloading docks

Strengths at Warehouse

Weaknesses – Possibility of Damages

Weaknesses – Material kept on Floor

Weaknesses – Material in Gangway

Weaknesses – Unsafe practices

Weaknesses – Workplaces/ Worktables not organized

Part 2: Lean Warehouse - 10 Golden Rules of Storage

Opportunities for Improvement

5 Freedom

a.Search free

b. Count Free

c. Air Free

d. Climb Free

e. Kneel Free

2 Hygiene Factors

Well Lighted 
Well Ventilated 

3 Good Practices

First In- First Out 
Point of Use Storage 
Heavy items at bottom of shelves 

Autonomous Maintenance to reduce life cycle cost of equipment

Part 3: Lean Warehouse

Opportunities for Improvement in Layout

  • Dedicated value stream flow for better customer service & faster response
  • Separate inbound & outbound flows for better productivity & reduced accidents
  • Material storage by turnover & type for optimized space & material handling
  • Reduction in waste movement & transportation of material to facilitate flow & not to increase inventory

Opportunities for Improvement in Processes

** - to prevent over-ordering & stock-out situations, if within scope of this engagement

Part 4: Supply Chain Improvement

Focus ONLY on Warehouse Improvement

Warehouse is part of Supply chain

If we improve warehouse stand alone

   1. We will get substantial, but sub-optimal, benefits

   2. Sustainability will be tough

Improvement in Total Supply Chain

Lean Supply Chain Focus

A Lean warehouse will allow organizations to serve customers faster, with less space, less inventory and with more accuracy.

Lean engages everyone, from the bottom to top, in a continuous improvement process. This can be challenging and involve major culture change for management and supervision who are used to solving all problems, and then ‘telling’ staff what to do.

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