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:

Because of the physicality of material handling, it’s hard for some people to understand the inherent nuances of equipment in terms of its flexibility and agility. DC operations and logistics managers have typically looked at material handling hardware as inflexible.

One of the compelling components to ACP agility is the flexibility of the information and control system known as the WCS (Warehouse Control System). With a WCS, companies can have the right combination of everything from electromechanical devices to information and associated systems. Operations managers can see what’s going on with the system and make changes on the fly. They can also integrate prognostic capability into their mechanical systems. These features and many more are already available. See SCDigest article – (Increasing Number of Options for Sourcing Warehouse Control Systems)

In addition to the above examples, another aspect of flexibility involves communications. In time, wireless connectivity will be in every integrated material handling control system, enabling users to reconfigure their processes more easily as their business needs change. Cabling costs and installation challenges will disappear.

Final Thoughts

Clearly, for most DC operations today’s emerging ACP technologies are capable of providing companies with the opportunity to reach higher levels of productivity without compromising operational flexibility.

Having said that, DC managers need to understand that to gain more specific operational flexibility, they need to resist buying on price, (i.e., traditional bid-to-spec process) because it can cut short the analysis and preparation on the front end that allows ACP providers to have an awareness of the buyers specific needs and make informed decisions that demonstrate an understanding of the flexibility that’s inherently available with integrated ACP solutions.

Agree or disgree with Holste's perspective? What would you add? Let us know your thoughts for publication in the SCDigest newsletter Feedback section, and on the website. Upon request, comments will be posted with the respondent's name or company withheld.

You can also contact Holste directly to discuss your material handling or distribution challenges at the Feedback button below.