Why it needs attention: Comprehensive facility operations design and layout requires a systematic process to determining the most appropriate combination of operations processes, material flows, material handling equipment, storage equipment, and information systems to satisfy the planned business requirements of a client. Whenever there is a major change in business the impacts volume, inventory or the customer shipping profile, a facility re-design is likely needed.
What we can do: Our team has performed operational audits, both as stand-alone projects and as the initial stages of a full design project. Our 35 years operational experience allows us to quickly determine how well the operation is functioning, and discern whether the facility layout, information technology, and material handling equipment are supporting or hindering the operation. We are able to gain great insight from operating staff and first level supervisors about their experiences with existing processes, which they may not be willing to share so readily with upper level management. In most cases, we are able to suggest basic changes that have had significant effects on improving performance, quality, and speed of an operation.
The Process: Our first step in a facility operations design is a determination of the business requirements that the operation must satisfy. This includes a review of the existing operation, an understanding of the business changes affecting the operation, and an in-depth analysis of existing productivity measures Our profile of the operation examines specifically SKU characteristics, inventory, and pick quantities, customer order characteristics, inbound receipts, outbound shipments, and SKU-level space requirements (cube and weight).
Our next step is to develop the feasible alternatives to satisfy the projected business requirements at a justifiable cost. These alternatives would take into consideration the availability of capital, existing information systems resources and limitations, risk management, flexibility, and the level of uncertainty about projections.
Our alternatives are then evaluated in detail to determine the following:
- How well each alternative satisfies customer requirements for throughput and accuracy
- The material flows into, within and out of the facility
- The adequacy and adaptability of the picking and storage modules
- Whether the equipment choices are appropriate for the projected needs of the business
- The capital and annual budgets associated with each alternative including facility costs, equipment, information systems, labor costs, utilities, and maintenance.
- The staffing requirements at the various levels of projected activity throughout the design year and at a midpoint year – this part of the evaluation needs to be thorough, particularly for operations requiring significant numbers of staff and/or higher skilled staff
- The qualitative aspects of each alternative also have to be evaluated
- Consistency with the company’s overall supply chain strategy
- The capability to phase in the installation over time to defer costs or information systems support requirements
- Flexibility and adaptability, particularly for higher levels of mechanization and automation
- Difficulty of implementation
- Maintenance requirements/equipment reliability issues
- Training requirements – both startup and ongoing
- Information systems sustainability
Using this analysis of the alternatives, the most appropriate solution that will satisfy the company’s requirements is selected. Thorough documentation of the projected costs and the rationale for the decision is crucial.
The final step of the operations design is the implementation of the selected alternative. The planning requirements for the implementation will be proportional to the size and sophistication of the recommended operational upgrades. If a new facility is required, detailed specifications for the new building, the new equipment, and the new information systems support will have to be developed. Vendors and contractors will need to be selected. A detailed schedule and coordination with all involved parties will also be required to insure the new operations design is implemented on time, on budget, and at the highest quality level.
Conclusion: Our team has long been at the leading edge of warehouse and distribution operations design and implementation. We have a record of success for developing efficient and productive designs that meet future throughput demands at the least available cost. We count on repeat assignments with satisfied clients for a significant portion of our business.
If you would like more information on how Jack Kuchta LLC can help you with your distribution network design or any of our range of services, please do not hesitate to call 201-579-8822 or email us at contactus@JackKuchta.com