Warehouse Automation - NOT!!

Implicit in the choice of an automated system is the assumption that your products, package size and place of doing business will not change significantly in the near future. As the CEO of a software company that creates warehouse management systems wrote recently, "When you automate an operation, you do not necessarily improve the operation, you simply automate it."

CHARACTERISTICS OF AN AUTOMATED DISTRIBUTION SYSTEM.

1. Expensive to implement, with a long payback period.

2. Difficult to move, remove or modify.

2. Designed to eliminate manual handling and worker judgment – and frequently is accompanied by reductions in labor costs, theft and errors.

4. Contains high mechanical and/or software complexity, which often makes implementation and thorough "debugging" difficult.

5. When a significant part of the system fails, the whole system usually "goes down" due to a high degree of integration and lack of feasible backup systems. (The ATM system is a good everyday example).

6. Since manual labor is reduced, the business can operate on three shifts with low incremental labor expense.

EXAMPLES OF AUTOMATED SYSTEMS:

• Powered conveyor storage/sortation system.

• Automatic storage and retrieval system (ASRS).

• Automatic case or item-pick system.

WHAT IS "INFOMATION"?

"Infomated" projects depend almost totally on people for their success and usefulness. If the full benefit is to be obtained, there must be thorough training, and most importantly, worker support, involvement and acceptance.

This family of systems is computer-driven, and its purpose is to make routine decisions, and support workers who do most of the actual physical labor. Working with normal material handling equipment, it brings needed information directly to the work site (frequently on a "real time" basis), using bar code scanners, keyboards, host computers or other independent machines such as palletizers.

Information in these systems moves with the speed of light, and can be tailored to prevent most unnecessary worker travel or searching. Comparing Infomated systems to Automated , we see the following differences:

• Much less expensive, with rapid payback, usually in 6 months or less.

• Easier to change, move, expand or contract, as needs change.

• There are almost always, major labor savings.

• The change-over can be accomplished in "bite size chunks", allowing gradual procedural and attitudinal changes among the workforce. (Some TOTAL change implementation has actually resulted in company failure).

• Increases (often significantly), accuracy and speed of task completion

• As referenced above, the system is only as good as managerial intelligence, foresight and planning, as well as worker training and user dedication.

EXAMPLES OF "INFOMATED" SYSTEMS:

• Computerized stock locator systems.

• Wireless communication terminals for fork trucks.

• Batch order picking systems.

• Computerized shipping/manifesting.

• Barcode-verified replenishment.

INFOMATED SYSTEMS AND PAYBACK

If the financial and business risk of full automation is more than your organization is willing to undertake at the moment, the infomating alternative may allow you to make great strides toward the 21^st century in an efficient, cost effective way. Usually a very large percentage of the total project payback can be realized with a relatively small expenditure of time or money.

These are always my first suggestions for immediate efficiency upgrades:

1. Set up a picker path that picks from both sides of the aisle instead of one – walking time is immediately reduced by 50%. (Which means that labor costs can also be reduced by 50%).
2. Make the pick slots smaller and closer together –again, walking is reduced by another 50%.

Note: by making the easiest changes first, the greatest savings are obtained with the least cost in time and money. Further changes will be more expensive, with progressively diminishing returns.

As you can see, even one segment at a time can make a tremendous difference. It is my experience that improved warehouse layout and picking systems provide the greatest impact, and is the ideal place to begin. Refer to my articles on "Picking Up Pick Rates" and "Batch Picking" for the next phase of infomation and payback.