Are Your Systems at a Breaking Point?

How to Get More Life Out of Your Automation and Controls Systems

By Bill Vincent, Principal

Many material handling systems and operations in warehouse and distribution centers (DCs) around the world today are strained to the breaking point. Economic pressures and reduced capital expenditures cause operations and maintenance managers to demand more from people and systems while cutting back on staffing levels and maintenance operations. And, despite economic limitations, advancements in technology continue to outstrip the ability of limited resources to stay current.

Additionally, recent investments made in ERP and WMS technology have been characterized by unrealized functionality on the IT side because equipment automation was not approved for upgrades. Many world-class IT systems are handicapped by obsolete material handling systems, leaving executive management and shareholders frustrated. This results in more pressure on DC management to maximize the performance of their existing operations and systems.

Over time, these pressures will have predictable results as the system starts to crack. You will see:

• Low or declining productivity (frequently coupled with high or rising turnover)
• Unacceptable levels of product shrinkage
• Inaccurate inventory records
• Ineffective wave management (often constrained by system limitations)
• Failure to fulfill orders on time
• Communication misses and failures between departments or applications
• High product re-circulation rates
• Low sortation accuracy rates
• Data loss
• System downtime
• Accidents
• Poor equipment performance and/or reliability.

Although every system experiences some of these symptoms from time to time, they are too frequently being accepted as a cost of doing business today. That's an understandable response from management teams struggling to deal with the pressures causing the problems, but it's a dangerous response. It's just like ignoring minor chest pains because there's no time to visit the doctor. The good news is that solutions do exist that can relieve stress to systems and optimize performance without a major investment. The first step is to locate the system "pain points." Answering simple questions about your system's performance can be used to identify where system flaws are having the most damaging impacts to operations and profitability. For example:

1. Which most accurately describes your system's ability to support operations in receiving?
   • Technology and information systems support error-free, efficient receiving operations that never interfere with ability of downstream operations to accomplish their objectives.
   • Errors, inefficiencies and downtime or other interference with downstream operations occasionally occur.
   • Errors, inefficiencies and downtime or interference with downstream operations regularly occur.
   • We do not currently measure the performance of our system's ability to support effective receiving operations.
2. Which most accurately describes your system's ability to support operations in put-away?
   • Technology and information systems support error-free, efficient put-away operations that never interfere with ability of downstream operations to accomplish their objectives.
   • Errors, inefficiencies and downtime or other interference with downstream operations occasionally occur.
   • Errors, inefficiencies and downtime or other interference with downstream operations regularly occur.
   • We do not currently measure the performance of our system's ability to support effective put-away operations.

This pattern of questions can be carried through your entire operation, from receiving through shipping, with more detailed questions asked inside the most complex or critical operations. For example, because sorters are typically the critical throughput constraint for a system and often impact order accuracy directly, questions such as the following are worth asking:

1. What is your sorter scanner read rate?
   • Greater than 99 %
   • 95 to 99 %
   • 90 to 95%
   • Less than 90%
   • I don't know
2. What is your sorter unknown (unknown bar code) rate?
   • Less than 1 %
   • 1 to 5%
   • Greater than 5%
   • I don't know
3. What is your sorter recirculation rate?
   • Less than 1%
   • 1 to 5%
   • Greater than 5%
   • I don't know

The objective of designing and selecting the questions is to perform a high level, evaluation of the ability of your system to support operations successfully in each area important to your business. For most operations, this list will be no longer than 10 to 15 questions.

Ironically, totally objective and accurate responses are not necessarily the target of these questions. Negative responses from area supervisors, even if somewhat inaccurate and subjective, will often serve as dependable red flags to further investigate system performance in a particular area.

Once the pain points have been identified, it's time to dive into the system in particular areas and collect detailed and objective data. For example, if the sorter recirculation rate is running above 20%, what are the specific factors responsible: bar code label hygiene, missing bar codes, product simulation or orientation, lane full conditions (real or false), missed diverts, etc.?

Objective analyses conducted at system "pain points" often expose opportunities for minor systems modifications or actions that can be taken to obtain significant improvements with minimal investment. Some examples of immediate improvements frequently possible include:

• Increasing scanner read rates and sortation accuracy
• Reducing or eliminating system bottlenecks (increasing throughput)
• Reducing jam rates
• Solving application interface issues (reducing or eliminating communications and data loss)
• Identifying opportunities to increase system reliability and reduce downtime and the risk for catastrophic failure

Some DCs will have the ability to build a team with the right skills mix to conduct their own systems evaluations and subsequent improvements. Others find it more effective to outsource this function.

If outsourcing, look for an approach that is comprehensive and disciplined. Ask to see templates used to gather information and examine the qualifications and experience of team members. A cross-functional team should conduct a two- to four-week analysis of system performance with the goal of making recommendations that will provide immediate relief. The process should start with the team providing a pre-assessment questionnaire to the project sponsor, typically the warehouse manager, and a designated team of department managers and/or supervisors. This team should include key representatives from each operational area/shift and maintenance. The questionnaire is developed to minimize the amount of time required to complete it by requesting a high-level description of the operations, but focusing primarily on perceived system performance in critical areas. The team reviews the questionnaire prior to deploying to the site, then hits the site using established templates and diagnostics tools to evaluate system performance at all critical control points in the system, including scanners, merges, decision points (internal and external to sorters), human machine interfaces (HMIs) and application interfaces. Additionally, the physical condition of key system components and preventative maintenance logs will be inspected. In addition to the performance metrics the team will capture, interviews with key operations and maintenance personnel should be conducted to gather specific data regarding problems identified on the initial questionnaire. At the conclusion of the site audit, the team will compile a report that will identify potential solutions to system problems and prioritize them by projected ROI and ease of implementation. The assessment will be concluded with the team briefing their findings to the project sponsor and the designated team.

Here are some specific examples of tactical recommendations made during automation and controls assessments with identified immediate improvements to systems and operations:

Problem: A packaging application had manual inspection and value-add operations occurring at different points in its packed box system. Variations in productivity at these stations could cause product to back up on the transport line, creating system gridlock if the condition was not corrected quickly.

Proposed Solution: Add photo-eyes to calculate throughput at critical control points in the system. Report throughput data on graphical user interfaces located at supervisory and management stations throughout the distribution center (transmittal to remote PCs and/or handheld devices via the Web as an option). Display alarm condition at terminals (pager notification as option) when throughput threshold at critical control points is approached. Management could now prevent problems in individual areas from threatening overall system throughput without increasing management or supervisory staff.

Problem 1: A manual tally station in a packaging line required an operator to enter packer identification numbers and box styles for each box that passed. Recent market demands have resulted in a greater number of box styles, making it necessary to add staffing to this station to keep it from becoming the throughput bottleneck for the line. Adding personnel to perform the same function has also increased the potential for error.

Proposed solution: Convert manual tally station to a combination automated tally/weigh station to eliminate a throughput bottleneck and eliminate the need for an operator.

Problem 2: The shipping sorter (shoe sorter) in a DC was unable to operate at peak capacity because it was constrained by the performance of a merge section immediately preceding it.

Proposed solution: Add photo-eyes and modify the control code for the merge section to reduce gaps between product and eliminate jams, thereby elevating throughput for the sorter and subsequently the entire system.

Problem 3: Frequent product jams at various points on a DC conveyor system required manual intervention to clear, regularly disrupting downstream operations and negatively impacting productivity.

Proposed solution: Modify conveyor guide rails and install product guides or "wedges" at critical areas to reduce frequent product jams.

Problem 4: Specific wave compositions significantly changed the volume of product leaving three pick engines that fed the same transport line. Default merge logic occasionally resulted in one or more engines having to wait for excessive periods of time before product could be released to the main transport line. This resulted in pick engine productivity losses and inefficiencies closing out orders at the shipping sorter.

Proposed solution: Add sensors and modify control code to allow for configurable balancing of product flow leaving pick engines feeding one transport line. Methodology to allow for operations to optimize picking productivity and system throughput by adjusting product release timers based on fluctuations in product mix was developed utilizing a quick simulation.

Problem 5: DC management and supervisors tracked production and productivity manually. Numerous factors prevented supervisors from being able to do a consistent job with this; therefore it was not uncommon for management to learn about substandard performance until it was too late to correct the situation. The result was missed or late deliveries, excessive overtime, and poor productivity.

Proposed solution: Provide an operational performance "dashboard" at supervisory and management terminals (remote access from PC or handheld device via the Web as an option). This would allow supervisors and managers to track progress against plan for key operational metrics (productivity by department or area, units processed per hour, % recirculation, % recirculation by product type etc.) in a real time manner, enabling corrective action to be taken early to ensure operating plans are met.

Often, the benefits realized from identified "quick fixes" are enough to give a system and its management sufficient breathing space to last for years. Other times, it may buy enough time to keep things alive until a larger system improvement project can be implemented. As part of the assessment, different long-term strategic initiatives may be identified, but these will come only as a supplement to the measures that can be taken quickly to provide immediate payback.

With all the "system stressors" present in today's business climate, it has become critically important to routinely evaluate the health of your system. Find the "pain points" and identify opportunities to relieve the stress and maximize the ability of your system to perform without major intervention.