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Executive summary
BACKGROUND AND GOAL
Centraal Boekhuis B.V. Culemborg is specialized in the distribution and transportation of books. It is the link between publishers and booksellers in the Netherlands and Belgium. Centraal Boekhuis runs a „book distribution centre‟ including a partly automated high bay warehouse. Since its implementation in the 80‟s, the order assignment procedure to this warehouse has hardly changed. However, the product flows through the system as well as the number of handled SKU‟s (titles) have grown
dramatically and the service demands are still increasing. The system hardware consists of conveyors, five fully automated cranes and eight picking stations (Figure 1).
It is observed that on certain moments during the order picking process, the system experiences capacity-related difficulties. During these periods, the automated part of the system is busy while the work load of the order pickers shows a sharp decline. Some measures have been taken to balance these two sub-systems but the effect of these measures appears to be limited. The goal of this study was to determine the causes of the idling and to present a solution in order to minimize it. Since the logistic flows are susceptible to changes over time, the presented solution should be able to cope with these changing flows. Furthermore, it should be implementable in the current hardware and software hierarchy. This led to the following research question:
What are the underlying causes of the idling and what can be done in order to improve the work load balance between the resources? Next to a theoretical solution, a practical implementation is of importance, taking into account the constraints set by the hardware and software.
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ANALYSIS AND IMPROVEMENTS
The automated high bay warehouse system was modeled by using the process performance (PROPER) model. In this model, distinction is made between the order flow, product flow and
resource flow through the system. By combining this model with steady state models of the individual flows, the missing (control) aspects can be pinpointed in a mutual exclusive and collectible exhaustive way. In the process of applying this modeling technique to the automated high bay warehouse system at Centraal Boekhuis, major and minor deficiencies were pinpointed for each flow.
The main conclusion from the analysis is that the underlying causes of the idling of pick stations are an excess of picking capacity in combination with an unbalance in the size of jobs (group of orders for the same SKU). This leads to the situation that at the start of the shifts (when large jobs are still available), the bottleneck is situated at the picking process but, after a couple of hours, it moves to the automated part of the system when large jobs run out. In addition, several aspects effect pallet flow negatively such that the pallets which are reclaimed by the cranes are not effectively transported to the pick stations and consequently obstruct the crane‟s reclaiming process. Since the bottleneck is situated at the cranes in the majority of time, this causes additional idling at the pick stations. The main aspect causing blockage of the pallet flow is the constraint that pallets with split orders (orders split over multiple pallets) need to arrive at a pick station in a particular order. To achieve this, the pallet flow is synchronized, which happens at the crane output lanes and evidently causes blockage. For each of the deficiencies one or more improvements are presented which amounted to 20
improvements in total. The most promising improvements are.
1. Introduce a buffer function at the conveyor stretches from the cranes to the central conveyor loop (which transports pallets from the cranes to the pick stations and vice versa).
2. Release the coupling between pick stations and jobs. In the current situation, a job is coupled to a pick station. At the same time, inventory is assigned to those jobs. When a pick station can receive a next pallet, the next pallet of that job is released for reclaiming. This is a very „pick station oriented‟ procedure. Since the cranes are the bottleneck, the work selection and inventory assignment procedure is to be „crane oriented‟ instead of „pick station oriented‟. This is realized by releasing the coupling between pick station and job and by applying an
alternative, „crane oriented‟ inventory assignment routine. This has the following advantages: a. Any crane can now reclaim inventory for any pick station which can receive a pallet.
This minimizes crane idling and leads to a higher crane utilization rate;
b. Reclaim time (travel time + (un)load time) can be taken into account when assigning inventory. This leads to less crane traveling time and thus a higher crane throughput; c. Balancing of „work in system‟ can be influenced in a more direct way due to the „per
Executive summary
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prioritize the jobs. In the current situation no coherent prioritization of orders takes place, which results in the situation that additional shipments are needed to distribute the orders which are not finished in time for the first shipments.
4. Reduce picking process capacity with 37,5% during the night and 12,5% during the day. EVALUATION BY SIMULATION
Based on the process interaction methodology, a simulation model was developed which served the purpose of offering an experimental environment to test the improvement proposals. From the proposals, three concepts were composed which vary in required implementation effort.
Concept A: without capital expenditure (CAPEX)
Concept B: with software changes to the warehouse management system (WMS) and minor CAPEX Concept C: with software changes to the WMS and the conveyor logic in addition to minor CAPEX
Simulation results showed that the product flow can be increased to such an extent that the same order package can be processed while reducing the order pick capacity with 25% (Table 1).
Table 1: system utilization graphs for Tuesday night’s shift and Wednesday day’s shift
Current situation After implementing concept C
Pi ck statio n ut ili zatio n Cr ane util izatio n Convey or u ti liz ation
In addition, simulation results showed that next to this reduction in picking capacity, the capacity of the automated parts of the warehouse can be increased. For the cranes this is in the order of 10% and for the conveying system this can increase to 30%.
Busy Idle Pallet change Retrieving Storing -37,5% -12,5%
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CONCLUSIONS AND RECOMMENDATIONS
Analysis showed that the idling is caused by an overcapacity at the picking process in combination with a number deficiencies in the order, inventory and storage-location assignment strategies. Simulation results showed that all three developed concepts were beneficial to total system performance. Since the concepts were developed with increasing implementation effort, it is recommended to directly implement concept A and implement concept B and C at the next WMS overhaul (planned in 2009-2010).
Conclusively, effort was put in the design of a shift arrangement which could accommodate an order arrival pattern in line with 24-hour delivery (i.e. orders would then arrive during the day). Although providing valuable insight into the matter, definite results for the shift arrangement were not obtained yet. Thus, additional study is necessary to come to a decisive schedule for this scenario.
