While the primary purpose of the distribution center continues to be order fulfillment, today’s DCs are becoming a hybrid of storage, order assembly, and marketing. The DC storage function hasn’t really changed all that much overtime except that stock moves somewhat faster now than it did a decade or so ago. Industry analysts’ contribute this to the accelerated speed at which a product becomes obsolete and/or falls out of fashion.

Holste Says: Managing today's full service quick response DC requires at least some basic understanding of assembly line sequence and balancing techniques in addition to the traditional warehousing and order fulfillment processes. What Do You Say? Click Here to Send Us Your Comments Click Here to See Reader Feedback

BizStats.Com publishes some national inventory turn averages broken down by industry. For Hardware, the national average is 3.5. For Grocery it is 12.7. For wholesalers of electrical goods it is 6.8. If you are a member of a trade association, they might publish survey results that give you an idea of what your industry norm is. The point is that inventory management has always been an important benchmark for DCs and that’s not going to change.

What is relative new to DC operations is the amount of order assembly and kitting operations that have migrated into the DC environment from downstream manufacturing operations. Much of this work, like price ticketing and kitting, can be done off-line and in advance of the actual order fulfillment process. This is referred to as parallel processing. However, customer specific value added services (VAS) like monogramming, gift-wrapping, and serial-number capture must be done in sync with the order fulfillment process and is referred to as serial processing.

Regardless of whether its parallel or serial, these production variations challenge DC managers to plan processes that are efficient for each, and can be scaled up or down, turned on and off as the activity shifts.

Addressing Production Planning Challenges

Normally, system planners use historical data to establish capacity requirements for each separate process and then design the processes and system flows accordingly. If the data is very granular, you can spot extreme peaks in demand. But, planning each process for its most extreme peak provides considerable excess capacity most of the time, and can be very difficult to cost justify. On the other hand, you should avoid using annual averages as that would be like the fisherman who drowned while fly fishing in a stream having an average depth of only 6 inches.

The following are a few planning ideas that can help you outsmart the assembly challenges:

• Choose the simplest process that works well for the majority of the orders then absorb the inefficiency for the others.

• Create a mini-DC or independent line of flow (like a “slapper” line) for orders that have common characteristics. These might include a small sub-set of the product line, single lines or single units, the same shipping package and/or compliance labeling requirements, or the same carrier mode. This may feature a workstation for picking and packing as a single-step process. Or, a separate conveyor line specifically designed to handle small lightweight cartons.

• If there is a fixed path conveyor system make sure that the flow permits products and materials to access all processing areas, and that it includes sufficient buffering and re-circulation capacity.

• Design workstations that have the capability to perform a variety of tasks and locate them so that they are easily accessed from different points in the primary line of flow. These might be configured to support several activities. And cross-train employees so that as the mix of requirements changes, they can be quickly re-assigned to a different workstation.

Depending on the size and scope of the operation, manual delivery methods may not reliably support throughput requirements leading to part shortages and processing delays. In addition, providing a sufficient number of workers to deliver parts to all of the various assembly stations in a timely manner during peak production periods may not be manageable.

Companies in this predicament need a more flexible, cost-effective delivery system capable of supporting a multi-shift operation. Deploying autonomous robot tuggers to deliver part bins, totes or carts from a centralized parts distribution depot to multiple assembly stations may be the solution.

As an example - this GT3 tugger (www.seegrid.com) employs patented industrial mobile robotics technology to move independently throughout the facility. First, it builds a 3D map of the environment utilizing onboard cameras. Then, independent reasoning ability enables the tugger to navigate a predetermined path throughout the facility to complete multiple delivery tasks.

Because of its versatility, the tugger can traverse multiple routes for the first shift, and subsequently be changed to follow a completely different route for the second shift. This flexibility to change the routes easily and frequently is a huge benefit providing real value for the DC.

Although widely deployed in manufacturing operations, I admit that up until just a few years ago, I would not have considered AGVs for the DC environment. But as DCs are required to take on more manufacturing oriented tasks it makes sense to adopt the appropriate technology for the task. Still, it is impressive that in such a short period of time AGVs are making such positive gains in DCs throughout the world. If you weren’t paying close attention - you would not be aware of this important change in DC material handling technology.

Final Thoughts

Managing today’s full service quick response DC requires at least some basic understanding of assembly line sequence and balancing techniques in addition to the traditional warehousing and order fulfillment processes. While all these additional tasks may increase operational complexity, you don’t have to be victimized by it. Careful data analysis and clever process planning, along with the adoption of appropriate technologies, can put you back in control.