Warehousing (หลั�กการแลัะเคร��องมื�อช่�วยว�เคราะห�)

โดย: ผศ.ดร.บรรหาญ ลิ ลิา

ภาควิ ชาวิ ศวิกรรมอุ�ตสาหการ คณะวิ ศวิกรรมศาสตร� มหาวิ ทยาลิ�ยบ�รพา

Roles and Connections

nth tier (n-1)th tier 1st tierManufacturing

Systems(include PACKING)

Warehousing

Component Parts, Raw Materials,Consumable parts, etc.

Component Parts, Raw Materials,Consumable parts, etc.

Component Parts, Raw Materials,Consumable parts, etc.

Finished Products

Supplier Chain

Customers

Supply Chain & Logistics

SuppliersMaterials,

parts,subassembliesand services

Inventory

ProducersFinished

goods, endproducts, and

services

Inventory

DistributorsPackage and

delivery

Inventory

CustomersTotal

satisfaction with(Quality, price,

delivery andservices)

Inventory

Productand

Services

Productand

Services

Productand

Services

INFORMATION

CASH

Why holding inventory/ What are the role of warehouse in supply chain?

Why holding inventory?

What are the role of warehouse in supply chain?

The VALUE CHAIN

Firm Infrastructure

Human Resource Management

Technology development

Procurement

Inbound

LogisticsOperations

Outbound

Logistics

Marketing

and

Sales

Service

M

A

R

G

I

N

Strategic aspects of Business

Production Product Suppliers Customers

Customer Value

Customer Value• Quality

• Service

• Cost

• Lead Time

• Innovation

• Safety

• Environmental care

Competitive Priority• Quality

• Service

• Cost

• Lead Time

• Innovation

• Safety

• Environmental care

Quality

“performing right the first time and every time”

• Meeting customer requirements

• Fitness for purpose

• Minimum variance

• Eliminate waste

• Continuous improvement culture

Service

“continually meeting the customer needs as the market changes”

• Support availability

• Product availability

• Flexibility

• Reliability

• Consistency

Cost

“knowing the real costs and looking at how to reduce them”

• Design of product

• Manufacturing process

• Distribution process

• Administration process

• Stock levels

Lead time

“knowing the real lead times and looking at how to reduce them”

• Time to market

• Time from order placement to the time it available to customer

• Response to market forces

• Days of stock cover

Set of Questions for a Manager

Do you need a warehouse ? Where should it be located? Are all the future supply and demand

requirements known? Is the labor cost stable? What products should be kept and how to

store and handle them? What is the target customer response time?

Set of Questions for a Manager

What is our current customer response time? Do you know the product location and does

your information accurate? Is the layout optimal? What are the operational standard? Should you outsource or manage it yourself? Etc…

Storage and warehousing

Aspects of focus• Space requirement

• Location

• Layout

• Storage systems

• Material handling equipment

• Demand characteristics

• Operations

Space Requirement

Space for products, component parts, raw materials, consumables, material handling equipment, operator moving, load-unloading, buffers, shelves, isles, personnel.

Dependent on:• Type of equipment for handling

• Quantity of items and duration of stay

• Storage policy

Location

Where should the warehouse be built? How many warehouse must be built? How large should each warehouse be? What are the factors of concern?

(location of manufacturing, customer bases, desire service level, renting or leasing, land cost, construction cost, taxes and insurance, etc.)

Layout

Inputs• Storage policy

• Demand characteristics

• Material handling equipment

• Costs

• Types of products

Layout

Approaches• Systematic Layout Planning (SLP)

• Mathematical models

• Basic and advanced algorithms

Layout

Models• Single row layout

• Multi-row layout with equal areas

• Multi-row layout with unequal areas

• Mixed integer model

• etc

Algorithms• Heuristic Algorithm

Storage Systems

Dedicated storage location policy Randomized storage location policy Class-based dedicated storage policy Share storage policy Etc.

Material Handling Equipment

Unit load design Types of MHD

• Conveyors

• Palletizers

• Pallet lifting devices

• Trucks

• Robots

• Automated Guided Vehicles (AGVs)

• Jibs, Cranes and hoists

• Warehouse material handling systems (WMHSs)

Demand Characteristics

Investigation of the demands of all items to be stored in a warehouse in order that the layout, equipment systems can designed accordingly.

Aspects• How many for each item to be stored?

• How long each item will stay?

• What is a T/S ratio?

Warehouse Operations

Receiving Put away/Storage Order Processing ---Picking Dispatching

Software in layout/warehouse modeling

CORELAP CRAFT BLOCPLAN FactoryOPT SPIRAL LayOPT

Transportation Model (problem)

Transportation model: is a type of application of optimization models generally found in the area of “Operations Research”

Problem Characteristics:• Product is transported from a number of sources to a

number of destinations at minimum possible cost.

• Each source has fixed and limited supply while each destination has fixed demand.

Supply Chain Management

Supply Chain

All facilities, functions, activities, All facilities, functions, activities, associated with flow and transformation associated with flow and transformation of goods and services from raw materials of goods and services from raw materials to customer, as well as the associated to customer, as well as the associated information flowsinformation flows

An integrated group of processes to An integrated group of processes to “source,” “make,” and “deliver” products“source,” “make,” and “deliver” products

Supply Chain Processes

Value vs. Supply Chain

Value chain• every step from raw materials to the eventual end user

• ultimate goal is delivery of maximum value to the end user

Supply chain• activities that get raw materials and subassemblies

into manufacturing operation Terms are used interchangeably

Supply Chain Management (SCM)

Managing flow of information through supply chain in order to attain the level of synchronization that will make it more responsive to customer needs while lowering costs

Keys to effective SCM• information• communication• cooperation• trust

Supply Chain Uncertainty

One goal in SCM:• respond to uncertainty in

customer demand without creating costly excess inventory

Negative effects of uncertainty• lateness• incomplete orders

Inventory• insurance against supply

chain uncertainty

Factors that contribute to uncertainty• inaccurate demand

forecasting• long variable lead times• late deliveries• incomplete shipments• product changes batch

ordering • price fluctuations and

discounts• inflated orders

Bullwhip Effect

Occurs when slight demand variability is magnified as information moves back upstream

Information Technology: A Supply Chain Enabler Information links all aspects

of supply chain E-business

• replacement of physical business processes with electronic ones

Electronic data interchange (EDI)• a computer-to-computer

exchange of business documents

Bar code and point-of-sale• data creates an

instantaneous computer record of a sale

Radio frequency identification (RFID)• technology can send

product data from an item to a reader via radio waves

Internet• allows companies to

communicate with suppliers, customers, shippers and other businesses around the world, instantaneously

Supply Chain Integration Information sharing among supply chain members

• Reduced bullwhip effect• Early problem detection• Faster response• Builds trust and confidence

Collaborative planning, forecasting, replenishment, and design• Reduced bullwhip effect• Lower Costs (material, logistics, operating, etc.)• Higher capacity utilization• Improved customer service levels

Coordinated workflow, production and operations, procurement• Production efficiencies• Fast response• Improved service• Quicker to market

Adopt new business models and technologies• Penetration of new markets• Creation of new products• Improved efficiency• Mass customization

Supply Chain Integration (cont.)

Collaborative Planning, Forecasting, and Replenishment

Process for two or more companies in a supply chain to synchronize their demand forecasts into a single plan to meet customer demand

Parties electronically exchange• past sales trends• point-of-sale data• on-hand inventory• scheduled promotions• forecasts

Suppliers

Procurement• purchase of goods and services from suppliers

On-demand (direct response) delivery• requires supplier to deliver goods when

demanded by customer Continuous replenishment

• supplying orders in a short period of time according to a predetermined schedule

Cross-enterprise teams coordinate processes between company and supplier

Outsourcing

Sourcing• selection of suppliers

Outsourcing• purchase of goods and services from an outside

supplier Core competencies

• what a company does best Single sourcing

• a company purchases goods and services from only a few (or one) suppliers

Distribution

Encompasses all channels, processes, and Encompasses all channels, processes, and functions, including warehousing and functions, including warehousing and transportation, that a product passes on its transportation, that a product passes on its way to final customerway to final customer

Often called logisticsOften called logistics LogisticsLogistics

transportation and distribution of goods transportation and distribution of goods and servicesand services

Driving force today is speedDriving force today is speed Particularly important for Internet dot-comsParticularly important for Internet dot-coms

Distribution Centers (DC)and Warehousing

DCs are some of the largest business DCs are some of the largest business facilities in the United Statesfacilities in the United States

Trend is for more frequent orders in Trend is for more frequent orders in smaller quantitiessmaller quantities

Flow-through facilities and automated Flow-through facilities and automated material handlingmaterial handling

PostponementPostponement final assembly and product configuration final assembly and product configuration

may be done at the DCmay be done at the DC

Warehouse Management Systems

Highly automated system that runs day-to-day Highly automated system that runs day-to-day operations of a DCoperations of a DC

Controls item putaway, picking, packing, and Controls item putaway, picking, packing, and shippingshipping

FeaturesFeatures transportation managementtransportation management order managementorder management yard managementyard management labor managementlabor management warehouse optimizationwarehouse optimization

Vendor-Managed Inventory

Manufacturers generate orders, not distributors or Manufacturers generate orders, not distributors or retailersretailers

Stocking information is accessed using EDIStocking information is accessed using EDI A first step towards supply chain collaborationA first step towards supply chain collaboration Increased speed, reduced errors, and improved Increased speed, reduced errors, and improved

serviceservice

SCM Software

Enterprise Resource Planning (ERP)• software that integrates components of a

company by sharing and organizing information and data

• SAP was first ERP software

• mySAP.com • web enabled modules that allow collaboration

between companies along the supply chain

Measuring Supply Chain Performance

Key performance indicators• inventory turnover

• cost of annual sales per inventory unit

• inventory days of supply

• total value of all items being held in inventory

• fill rate

• fraction of orders filled by a distribution center within a specific time period

Inventory turns =Inventory turns =Average aggregate value of inventoryAverage aggregate value of inventory

Cost of goods soldCost of goods sold

Average aggregate value of inventory =Average aggregate value of inventory =

==(average inventory for item (average inventory for item ii)) X (unit value item X (unit value item ii))

Days of supply =Days of supply =(Costs of goods sold)/(365 days)(Costs of goods sold)/(365 days)

Average aggregate value of inventoryAverage aggregate value of inventory

Key Performance Indicators

Key Performance Indicators: Example

Inventory turns =Inventory turns =$34,416,000$34,416,000

$425, 000, 000$425, 000, 000

Days of supply =Days of supply =($425,000,000)/(365)($425,000,000)/(365)

$34,416,000$34,416,000

= 12.3= 12.3

= 29.6= 29.6

1. Cost of goods sold: $425 million

2. Production materials and parts: $4,629,000

3. Work-in-process: $17,465,000

4. Finished goods: $12,322,000

5. Total average aggregate value of inventory (2+3+4): $34,416,000

Other Measures of Supply Chain Performance

Process Control• used to monitor and control any process in

supply chain

Supply Chain Operations Reference (SCOR)• establish targets to achieve “best in class”

performance

SCOR Model Processes

Plan

Develop a course of action that best meets sourcing, production and delivery requirements

Source

Procure goods

and services to

meet planned

or actual

demand

Make

Transform

product to a

finished state to

meet planned

or actual

demand

Deliver

Provide products

to meet demand,

including order

management,

transportation

and distribution

Return

Return

products,

post-delivery

customer

support

Number of days to achieve an unplanned 20% change in orders without a cost penalty

Production flexibility

Number of days for supply chain to respond to an unplanned significant change in demand without a cost penalty

Supply chain response time

Supply Chain Flexibility

Number of days from order receipt to customer delivery

Order fulfillment lead time

Supply Chain Responsiveness

Percentage of orders delivered on time and in full, perfectly matched with order with no errors

Perfect order fulfillment

Percentage of orders shipped within24 hours of order receipt

Fill rate

Percentage of orders delivered on time and in full to the customer

Delivery performance

Supply Chain Delivery Reliability

DefinitionPerformance Metric

Performance Attribute

SCOR: Customer FacingSCOR: Customer Facing

DefinitionPerformance Metric

Performance Attribute

SCOR: Internal FacingSCOR: Internal Facing

Revenue divided by total assets including working capital and fixed assets

Asset turns

Number of days that cash is tied up as inventoryInventory days of supply

Number of days that cash is tied up as working capital

Cash-to-cash cycle time

Supply Chain Asset Management Efficiency

Direct and indirect costs associated with returns including defective, planned maintenance and excess inventory

Warranty/returns processing cost

Direct material cost subtracted from revenue and divided by the number of employees, similar to sales per employee

Value-added productivity

Direct cost of material and labor to produce a product or service

Cost of goods sold

Direct and indirect cost to plan, source and deliver products and services

Supply chain management cost

Supply Chain Cost