Holste Says: Knowing the processing capacity of each element of the system staffing adjustments can be made so that peaks and valleys can be smooth out and operating efficiency maintained - putting you back in control. What Do You Say? Click Here to Send Us Your Comments Click Here to See Reader Feedback

Not only are DCs subjected to the ebbs and flows of incoming orders, but they are also subjected to a changing mix of work content for those orders. Some orders may be dominated by full cases or even full pallet loads, while others have a high piece-picking content. Still others may require value-added services such as gift wrapping, serial number capture, and in some cases price ticketing. If E-commerce orders are thrown into the mix, they may be single line and/or single-piece orders. These variations challenge DC managers to plan processes that are efficient for each, and yet can be turned on and off as the activity shifts.

Normally, material handling system planners and designers 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 system capacity most of the time, and can be very difficult to cost justify. On the other hand, you should avoid using annual averages – that would be like the guy who drowned while fly fishing in a stream having an average depth of only 6 inches.

A better approach is to establish criteria for a theoretical “design day” based on an average day during the peak order processing period (week/month in a better than average sales year) plus a growth factor bump-up. The goal for every DC is to have a “good day” meaning that all orders received were shipped. Good days add up to good weeks which add up to good months and so on. That’s why establishing criteria for a design day is critical to system success. By comparing forecasted incoming volume to system capacity, operations managers can arrange work schedules and allocate labor accordingly.

From a system design standpoint, by establishing a design day it becomes somewhat easier to develop a capacity flow chart and understand how each process interfaces with other processes and how best to integrate them into one continuous flow system.

The following are a few planning ideas that can help you better manage volume fluctuations:

• In a mechanized or semi-automated system, provide for a continuous flow (re-circulation loop) that allows flow from any process to any another process. This will help to reduce congestion and will keep work flowing into all workstations.

• Create a mini-DC process or independent line of flow (like a “slapper” line) for orders and/or customers that have common characteristics. These might include a small sub-set of the product line, single lines or single units, the same value added shipping package and/or compliance labeling requirements, or the same carrier. This mini-DC may feature workstations for picking and packing as a single-step process. Or, a separate conveyor line may keep high-volume flow of small cartons off the primary system.

• 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 work requirements change, they can be quickly re-deployed.

Final Thoughts

No doubt managing DC volume fluctuation efficiently is a major challenge. But, you don't have to be victimized by it. By knowing the processing capacity of each element of the system staffing adjustments can be made so that peaks and valleys can be smooth out and operating efficiency maintained - putting you back in control.