Recently, Distribution Digest interviewed logistics executives and DC managers relative to a Supply Chain Digest survey on Automated Case Picking in the DC and found that near the top of their list of concerns (just behind ROI) was operational flexibility, or the perceived lack thereof (to download the report, go to Automated Case Picking 2009: The Next Frontier In Distribution Center Management).
So we asked them what their key concerns are relative to flexibility – examples of their collective answers are as follows:
- Value Added Services - Customer specified services as practiced both internally and externally.
Note: We probed a little deeper on this one and found that the unraveling of shipping compliance labeling standards is the major concern at this time. See SCDigest report - (Meeting with VICS on Emerging Retail Carton Labeling Issues)
- The capability to respond quickly to changing market conditions.
- The flexibility to alter operations on-the-fly in order to respond to unplanned events.
- The ability to deliver consistently the right item to the right place at the right time.
- A clearly demonstrated ability to improve overall operations.
Another big flexibility issue is designing and providing systems that are SKU and volume independent. This means having the ability to add SKUs easily without adding or modifying hardware and ramping-up capacity incrementally by adding system modules.
Many believe that the more highly automated the material handling system the less flexibility you have. One CIO told us that when they started searching for a Warehouse Management System (WMS), for example, they were looking for a supply chain partner who could support both retail store and direct-to-consumer operations in a single facility. The two picking and shipping processes are very different and frequently changing, so the warehouse management application had to be adaptable and flexible.
We were not surprised by the comments we received. It’s true that highly automated systems are typically difficult to reconfigure. If your business is multi-channel and/or in anyway fashion or style orientated, then you know that year-to-year changes in products, customer order profiles, and value added services are normal and to be expected. Therefore, all throughout the system planning process the need for operational flexibility must be defined and stressed.
The following are a few examples of where system flexibility is satisfying changes in business practices:
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