Supply Chain Best Practices Consortium

Transcription

1 Supply Chain Best Practices Consortium Order Picking Executive Seminar Supply Chain Leadership Forum Track B, Session 3 September,

2 Session Scope This session covers best practices for what is generally considered the most important DC function Order Picking. We will discuss: Basic Best Practices for Order Picking Order Picking Methods and Choices What Order Picking Technologies to Use and When Selecting the Right Order Picking Equipment Creating the Perfect Order Methods, Motivation, Mindset or Myth? 2

3 Summary Findings Choice of picking methodology varies by industry group and segment. As picking requirements increase (as well as number of unique SKUs), the methodology becomes more complex. Choice and use of technologies to drive order pickers is relatively consistent across industry groups and segments. The same tools are being used to support multiple methodologies. Basic equipment such as racks, shelving and bins are still the dominant choice for pick locations. Automation is most often applied in operations with more SKUs and more each picking. Order picking is as much about people and personal accountability to accuracy as it is about balancing operations, technology use, and choosing the right methods. The perfect order cannot be reached without the right harmony of labor, equipment, technology, process and planning. 3

4 Order Picking Basic Best Practices Have Clear, Concise Picking Instructions Keep It Clean and Organized Minimize Travel Distances Confirm, Confirm, Confirm Hold People and Teams Accountable 4

5 Order Picking Methodology Percentage of Lines Filled 40% 35% 30% 25% 20% 15% 10% 5% 0% Percentage of Orders By Pick Methodology Average Big Retail All Retail Catalog Consumer Goods Industry Segment Discrete picking Zone picking Batch picking Wave picking Zone-batch picking Zone-wave picking Zone-batch-wave picking Other 5

6 Order Picking Methodology Choices Discrete (Order) Picking One person picks one order, one line (product) at a time. Travel distances are the enemy! Zone Picking One person picks part of a single order within a designated area of the overall pick area. Zone Balancing and order consolidation are critical. Bucket Brigade Zone picking with floating zones, most often applied in Pick and Pass set-ups. Experience and well-trained staff a must!! Batch Picking One picker picks a group of orders (batch) at one time, one line at a time. Sortation and segregation during picking must be managed to obtain labor savings. Wave Picking Consists of multiple pickers in zones throughout the warehouse, picking items in those zones only for a wave of orders. Automation sortation equipment makes this viable for high speed operations. Zone Batch Picking Batch picking within a zone, prior to sending to a consolidation area. Manual sortation with full order routing to minimize order consolidation. Zone Wave Picking Staggered zone wave picking to balance the operational labor. Sophisticated sortation, significant order accumulation capacity and planning tools required to manage effectively. Zone Batch Wave Picking A very highly sophisticated and complex picking strategy that batches within certain zones to create cases or inner packs, within a larger wave that may or may not be balanced across zones. Much like Zone Wave Picking, generally requires both sophisticated sortation and significant order accumulation capacity to manage effectively. Low Technology Required High 6

7 Order Picking Methodology A low number of SKUs is perfect for discrete picking. Based upon product mix, combinations of several or all pick methodologies may be appropriate. What mix of methods are you using and why? Have you considered others? 7

8 Using the Right Picking Technology Type What It Is Most Often Used For Compatible With Pick List Label Directed Pick-to-Light/ Put-to-Light RF (Radio Frequency Devices) Voice Recognition RFID (Radio Frequency Identification) Automated Pick Systems Printed list of pick instructions in pre-determined sequence. Pickers check off completed picks. Confirmation through manual entry into system. Paper-based using labels to route pickers and check off pick by applying label to pick unit. Light-directed pick guidance including location and quantity to pick/put for an order/ship carton. Onboard and hand-held terminals display picking instructions and provide means of confirming or correcting picking orders using a barcode scan. Individual headsets exchange audio and verbal inputs between the picker and system, directing operators and receiving confirmations. Onboard and hand-held terminals display picking instructions and provide way to confirm or correct orders using a proximity scan of RFID tags via RFID readers. Mechanized picking or dispensing of product driven by advanced software. Automated picking can include dispensers such as A-frames, robotic pickers, AS/RS, and many other variations. Each, case, pallet or unit load picking Case, pallet or unit load picking Each and case, picking Each, case, and pallet picking Case, and pallet picking Case, and pallet picking (each picking is still cost prohibitive) Each, case, and pallet picking All pick equipment, RF picking Pick-to-light, RF, RFID, voice, pick modules, sortation Shelving, carousels, flow rack, pick modules All pick equipment, labels, voice All pick equipment, labels, RF, RFID All pick equipment, labels, RF, voice Barcodes and RFID Low Implementation Difficulty High 8

9 Using the Right Picking Technology Percentage of Lines 40% 35% 30% 25% 20% 15% 10% 5% 0% Use Of Technology for Order Picking By Industry Group RF/computer Paper based Label Pick to light Pick to voice Automated directed. directed picking Order Picking Technology Average Big Retail Retailers Catalog Consumer Goods RF-Directed is most popular? Will it be so going forward? Automated picking is limited to Consumer Goods. Why? What emerging technologies are best practices? What have you found success using? 9

10 Selecting the Right Pick Equipment Equipment by Percentage of Lines Picked Equipment Option Average Retailers Catalog Consumer Goods Pallet rack 32% 34% 23% 33% Floor stack 17% 7% 2% 29% Case flow rack 12% 15% 2% 8% Shelving 9% 15% 25% 2% Bins 7% 4% 18% 8% Decked racks (cases) 6% 8% 8% 3% Drive-in rack 4% 0% 0% 8% Double deep rack 3% 3% 2% 2% Pushback rack 3% 1% 0% 5% Other 3% 6% 0% 1% Pallet flow rack 2% 2% 0% 0% AS/RS 1% 4% 18% 1% Carousels 0% 1% 2% 0% Even in catalog operations, pallet rack accounts for 23% of storage locations picked from by percentage of lines. Catalog has highest use or AS/RS (carousels, mini-loads) due to the high number of SKUs and short cycle times. In case pick operation, 44% of total case pickers are still pick-to-pallet, while interestingly, on average 34% of case picks are reported to be done using case pick modules. In retail, it climbs to 44%. 10

11 Selecting the Right Pick Equipment Case Picking (Full case picking to: pallet, riding pallet jack, order picker, conveyor, etc.) Pick Medium When to Use Benefits Limitations Floor Location Fast case movers Low clear spaces Specials/put-to-store Reduce pick travel Minimal investment Easily re-configured Replenishment Number of locations Decked Rack Slow case movers Odd/mid-size items Low inventory SKUs Reduce pick travel Low investment Easily re-configured Inventory quantity Item size Variable slot sizes Selective Rack Medium case movers All level picking Minimize replens Reduce travel Low investment Choice of pick truck Fast mover replenishment Dynamic Flow Rack (Deep Lane rack) Faster movers High inventory stock Palletized stock Stock rotation Minimize replens Decreased travel Higher cost racking small lots are an issue Pick-to-Belt Faster movers High inventory stock Palletized stock Stock rotation Active replenishment Decreased travel High cost Secondary sortation Label requirements Others 11

12 Selecting the Right Pick Equipment Unit Picking (less than case pick to: tote, shipping carton, cart, pallet, etc.) Pick Medium When to Use Benefits Limitations Static Shelving/Bins Slow movers Low inventory stock Small items Low cost Flexible application Easily re-configurable Floor level picking increased travel Item size limitations Decked Rack Slow movers Low inventory stock Case/odd shape items Low cost Flexible application Easily re-configurable Mixed SKU location management Increased travel Slow to medium movers Minimize travel Capital investment Carousels High volume of orders High SKU count High throughput High accuracy picking Replenishment cycle Secondary pack-out Carton Flow Rack Medium to fast movers High volume of orders Limited SKU count Reduce travel High throughput Variable staffing Order tracking Replenishment Secondary pack-out Mini Loads High volume of orders High SKU count Peak order windows Minimize travel Very high throughput High accuracy picking Capital investment Secondary pack-out Item size limitations Others 12

13 Selecting the Right Pick Equipment Pallet Picking (Full pallet picking to fork trucks or automated systems) Pick Medium When to Use Benefits Limitations Bulk Storage Low SKU count Large quantities/sku Palletized unit loads Storage density Accessibility Limited capital Must be stackable Large lot quantities Stack height Static Rack (Selective, Double Deep) Slow movers Small quantities/sku Palletized unit loads Storage density Accessibility Moderate capital Requires fork truck Sprinklers Vertical travel time Deep Lane Rack (Drive-In, Flow Rack, etc) Faster movers High inventory stock Palletized stock Stock rotation Minimize replens Decreased travel High capital Small lots are an issue Product rotation AS/RS Slow/fast movers Any quantity/sku Palletized unit loads Storage density Accessibility Minimal labor Very high capital On-going maintenance Reliability Others 13

14 Creating the Perfect Order What is the Perfect Order? The ability to get the right product at the right time to the right place in good condition along with: o Proper paperwork (pack list, BOL, Export Documentation) o Fully compliant labeling and ASNs o Accurate billing o Right packaging (carton size, weight, tonnage) o Using the right carrier/deliver on the right day o Others 14

15 Creating the Perfect Order Who Here is Being Measured by the Perfect Order? What Are the Key Criteria for Which You Are Being Held Accountable? Where Are You Struggling? How Are You Making It Work In Your Operation? o People Adding staff, overtime, training o Process Auditing, method training o Systems Electronic confirmation, EDI, cycle counts, audits o Equipment Scans, sortation, automation, etc. 15

16 Creating the Perfect Order Influence and Demands Right product, right quantity, and no errors Rapid fulfillment and short lead times Smaller quantities, more frequently Order tracking Key Requirements to Achieve Trained labor, real-time information and pick confirmation Throughput capability, flexibility, automated equipment and systems Unit and case picking equipment, systems, and visibility to plan and balance Tracking and process monitoring technology Compliant labeling, ASN/EDI and packaging Systems, equipment and process control What Do You Consider the Perfect Order? What Are You Hearing Is Coming Next? 16

17 Potential Group Discussion Points How Many Order Picking Variations Do You Use In Your Operations and What Benefits Do You Get From Each? What Is Your Next Step in Improving Order Picking Why Are You Going That Direction? How Successful Have You Been With Advanced Technologies in Directing and Supporting Order Picking? Where Have You Failed? How Satisfied Are You With Present Equipment and Methods? Why Is Your Operation Different From the Folks Sitting Next To You? Does It Prevent You From Leveraging Their Successes? 17

18 Important Takeaways While there are many Order Picking takeaways in Benchmarking & Best Practices, some of the more important are: Order Picking is different by Industry and the selection of equipment and methods, but the principals are the same. Building a Pick System is about handling peak volumes as well as balancing labor throughout the day and week. A best practice design will do both. Accuracy is a factor of the quality of the people picking as much as it is the order pick confirmation process and systems used. As the customer base, order size, and product line changes, so must the order picking areas within your operation. For some this may be once a year, for others twice a day. Never make your operation too rigid! The Perfect Order is here to stay, BUT what it means will keep evolving! 18

19 Benchmarking & Best Practices References Information on Order Picking and related topics can be found in the following references: Section/Topic DC Profile DC Layout Online Interview Distribution Center Operations Functional Practices Labor Management Costs and Performance Metrics Warehouse Management Systems Outsourced DCs Automated Material Handling Analytical Reports DC Operations Overview Warehouse Management Systems Order Picking Operations Reports and Analysis DC Configuration and Basic Operations Executive Seminar Presentations Distribution Center Configurations and Trends Distribution Center Operations Practices Distribution Center Slot Management Practices Distribution Center Labor Management Distribution Center Costs and Performance Metrics Warehouse Management Systems - Current Practice and Trends Outsourced Distribution Center Operations and Value Added Services Note: Available for downloading at 19