How to design the most efficient pick and pass system. Alina Stroie MSc Supply Chain Management Rotterdam School of Management

Transcription

1 How to design the most efficient pick and pass system Alina Stroie MSc Supply Chain Management Rotterdam School of Management

2 Warehouse operating costs Other costs; 45% Order picking; 55% Source: Tompkins et al.,2003 2

3 Warehouse operating costs Other costs; 45% Order picking; 55% Significant impact on bottom line Labor intensive Source: Tompkins et al.,2003 3

4 Breakdown of order picker time Setup 10% Other 5% Pick 15% Travel 50% Search 20% Source: Tompkins et al.,2003 4

5 Breakdown of order picker time Setup 10% Other 5% Pick 15% Travel 50% How can we reduce non-value added time? Search 20% Source: Tompkins et al.,2003 5

6 Multiple strategies Popular due to simplicity Pick-and-pass Simultaneous picking Bucket brigades Relatively low implementation cost High demand rate High SKU variety Small-medium products 6

7 Pick and Pass Zone Picking OUT IN To reduce order picking costs, the storage area is divided into zones, covered by one or more pickers; this reduces travel and search time. Zone D Zone A Pick-and-pass is an order picking strategy: Each customer order is assigned a tote; Totes visit zones in the system; At each zone, a picker will retrieve products from storage and fill the tote before sending the tote back on the conveyor. Zone C Zone B Slide 7

8 What is the most efficient pick and pass system? 8

9 Designing a pick and pass system Number of segments Strategic Tactical Operational Number of zones / segment Use of shortcuts Block and recirculate protocol Class-based versus random storage 9

10 What is the most efficient pick and pass system in terms of these 5 variables? 10

11 Modelling pick and pass systems O I Number of segments 4, 6, 8 Number of zones/segments 2, 4, 6 Allowing totes to recirculate Yes or No Allowing totes to use shortcuts Yes or No Storage policy Random or Class-based storage Modelled in Material Handling Simulation Package (MHSP) Slide 11

12 Simulation Demo Material Handling Simulation Program

13 Simulation parameters User determined parameters Order size UNIF (1,5) Order generation rate Number of orders per simulation run Number of simulations per policy set EXP (0.0167) totes/second 1, Picking time EXP (0.2) picks/second Reasoning and constraints The number of orders per simulation run and the number of simulations per design are selected based on the standard deviation of the average throughput rate. At this setup, the confidence intervals are sufficiently small. The order generation rate cannot be higher, otherwise a blockage occurs in specific designs. Slide 13

14 Finding the most efficient design Choice to use Data Envelopment Analysis (DEA) Minimum set of assumptions to evaluate models along different measurement units (in this case time and cost). The goal is to compare policy sets with one another, rather than to find the optimal design for a pick-and-pass system; DEA achieves this by ranking policy sets according to their relative efficiency within the group. 14

15 Finding the most efficient design DEA calculates the efficiency of a particular policy set based on its ability to generate output given a specific input. How does DEA work? In this case, DEA assigns an efficiency score based on the ability to achieve the lowest average throughput time with the lowest total costs possible. DEA input is the total cost of a policy set DEA output is based on the average throughput time of a policy set 15

16 Total Costs (per 1000 orders) ( ) How did the designs perform? Top 10 least efficient have in total 36 or 48 zones (2 exceptions) segments 2 zones/segm. with shortcuts Top 10 most efficient have in total 12 or Most 16 zones efficient: 6 segments 2 zones/segm. with shortcuts 4 segments class-based 4 zones/segm. storage no recirculation with shortcuts 200 9,00 9,50 10,00 10,50 11,00 11,50 12,00 12,50 13,00 Average Throughput Time (minutes) Slide 16

17 What did I find? Designs with few zones and shortcuts are most efficient in the set Across all metrics studied (total, investment, and operational cost, average throughput time, and make span), a smaller number of zones seems to perform better than designs with many zones. 100,00% 80,00% 60,00% 40,00% 20,00% Relative efficiency (outcome of DEA) 0,00% Total number of zones Slide 17

18 Total Costs (per 1000 orders) ( ) Some interesting clusters Class-based Allowing Allowing storage totes totes effect use to over random recirculate shortcuts storage 0.9% 7.4% 0.3% increase decrease in average throughput time ,00 9,50 10,00 10,50 11,00 11,50 12,00 12,50 13,00 Average Throughput Time (minutes) Slide 18

19 When designing your system No trade-off between total cost and average throughput time performance: fewer zones perform better on both metrics. Number of zones needs to be able to handle demand, otherwise the system becomes unstable and performs poorly. If possible, shortcuts should be implemented as these significantly shorten the time travelled by totes. Storage policy and allowing recirculation should be decided on a case-bycase basis. Slide 19

20 Thank you

21 Appendix

22 Calculation of average throughput time Average throughput time simulation j 1000 i=1 Throughput time tote i = 1000 Average policy set throughput time 72 j=1 Average throughput time simulation j = 72 22

23 DEA output To reverse the goal of maximization of the output, for each DMU, the average throughput time of that DMU is subtracted from the maximum average throughput time of all policy sets: Let avg i denote the average throughput time of DMU i. Let max = max(avg 1, avg 2,, avg 72) Then for each DMU the output variable is given by: (max avg i ) 23

24 Effect of average throughput time on the efficiency of the models Total cost Efficiency 2.500,00 120,00% 2.000,00 100,00% 1.500,00 80,00% 1.000,00 60,00% 40,00% 500,00 20,00% 0, ,00%

25 Total Costs (per 1000 orders) ( ) Results: recirculation 2500,00 Comparison of policy sets by number of zones and segments, and recirculation policy 2000, , ,00 500,00 0,00 9,00 9,50 10,00 10,50 11,00 11,50 12,00 12,50 13,00 Average Throughput Time (min) 4S 2Z no recirculation 4S 2Z recirculation 4S 4Z no recirculation 4S 4Z recirculation 4S 6Z no recirculation 4S 6Z recirculation 6S 2Z no recirculation 6S 2Z recirculation 6S 4Z no recirculation 6S 4Z recirculation 6S 6Z no recirculation 6S 6Z recirculation 8S 2Z no recirculation 8S 2Z recirculation 8S 4Z no recirculation 8S 4Z recirculation 8S 6Z no recirculation 8S 6Z recirculation Slide 25

26 Total Costs (per 1000 orders) ( ) Results: shortcuts 2500,00 Comparison of policy sets by number of zones and segments, and shortcut allowance 2000, , ,00 500,00 0,00 9,00 9,50 10,00 10,50 11,00 11,50 12,00 12,50 13,00 Average Throughput Time (min) 4S 2Z no shortcuts 4S 2Z shortcuts 4S 4Z no shortcuts 4S 4Z shortcuts 4S 6Z no shortcuts 4S 6Z shortcuts 6S 2Z no shortcuts 6S 2Z shortcuts 6S 4Z no shortcuts 6S 4Z shortcuts 6S 6Z no shortcuts 6S 6Z shortcuts 8S 2Z no shortcuts 8S 2Z shortcuts 8S 4Z no shortcuts 8S 4Z shortcuts 8S 6Z no shortcuts 8S 6Z shortcuts Slide 26

27 Total Costs (per 1000 orders) Results: storage policy 2500,00 Comparison of policy sets by number of zones and segments, and storage policy 2000, , ,00 500,00 0,00 9,00 9,50 10,00 10,50 11,00 11,50 12,00 12,50 13,00 Average Throughput Time (min) 4S 2Z random storage 4S 2Z class-based storage 4S 4Z random storage 4S 4Z class-based storage 4S 6Z random storage 4S 6Z class-based storage 6S 2Z random storage 6S 2Z class-based storage 6S 4Z random storage 6S 4Z class-based storage 6S 6Z random storage 6S 6Z class-based storage 8S 2Z random storage 8S 2Z class-based storage 8S 4Z random storage 8S 4Z class-based storage 8S 6Z random storage 8S 6Z class-based storage Slide 27

28 Make span (hours) Effect of increasing the launch rate Initial scenario: launch rate = EXP (0.0167) totes/second New scenario: launch rate = EXP (0.03) totes/second Constraint: models with recirculation and congestion Effect: Higher average throughput rate Lower make span Recirculation still increases average throughput time Comparison of make span based on different launch rate Average throughput time (seconds) , , , , ,00 DMU 500,00 Launch rate = exp(0.03) totes/second Launch rate = exp(0.0167) totes/second 0, Launch rate = exp(0.0167) Launch rate = exp(0.03) Slide 28

29 Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Zone Zone Zone Zone Zone Zone Zone Zone Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Zone Zone Zone Zone Zone Zone Zone Zone Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf Zone Zone Zone Zone Zone Zone Zone Zone Shelf Shelf Shelf Shelf Shelf Shelf Shelf Shelf 29

30 Most efficient model: 12 zones, shortcuts, class-based storage, no recirculation Slide 30