Managing Distribution and Warehouse Operations - Coursework Example

Purchasing and Distribution xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Name xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Course xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Instructor xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx Date Managing distribution and warehouse operations have been an issue that many supply chain organizations are focusing in order to do more with less. In other words, the key point is to focus on lowering the cost of operations while increasing productivity (Chen, Lu & Chang, 2003). They are demanding for cost reductions in labour, shipping and space with remarkable improvements in productivity, throughput and inventory accuracy. Customers on the other hand are demanding compliance; value added services and shorter delivery lead times. The companies therefore have been faced by a challenge of to address these cost issues so as to remain competitive. Distribution and warehousing are about careful use of space and time (Xu et al, 2003). In other words it requires labour or persons hour both of which are expensive and so one wishes to use as little of each as possible in delivering products to the customer. Warehousing and distribution departments are always under pressure to deliver value to the enterprises. At the operational level they are focused on reducing costs and overhead, boosting productivity, improving profits margins, improving inventory and achieving greater inventory accuracy. Moreover, their success is measured by how they perform in key areas like on time delivery, order accuracy, order fill date, throughput and cost per order. This therefore calls for implementation of elements that continue to add value to these departments so that they can ease the pressure they encounter in their operations (Saad, Jones & James, 2002). These elements to add value to warehouse and distribution operations is due to the fact that many organizations have suffered inefficiencies due to time wastage and lack of information on the location of the items. For example Global Transport and Logistic Company (GEFCO) is one warehouse that have implemented computerized mechanisms to handle their operations in their store. This has entirely reduce the amount of time wasted and therefore its more valuable compared to any other store that may not have such technology. Moreover, they provide conducive atmosphere for the workers leading to employee’s satisfaction and protection. There are various strategies that have been used so as to eliminate non value adding activities and addressing the business drivers that are of great importance. Consequently, if applied intelligently, they bring an organization logistics strategy into alignment with the business strategy and help provide a competitive edge in the market sector. Time is of great importance and therefore working towards reducing time wasting instances will add value in these operations (Roodbergen & Koster, 2001). Therefore reducing time wasted travelling is a key element. Significant portion of an order picker’s time is spent travelling between picks (Lambert & Cooper, 2000). For example in Aqua Warehouse, high-tech information technology has been applied to avoid wasting time. In other words, they operate under technological aspects that enable the company deliver products in Essex Kent, Herts, Suffolk and across UK with a user friendly system with dispatches the same day they receive the order. Deploying methods that will reduce travel time condense the face and allowing the staffs to work smarter are very vital. This being the case, flow rack, optimized flow paths and dynamic slotting are of better options (Dyckman, 2001). In other words, having computer integrated within the warehouse management system reduces the waste involved in transporting, human motion and waiting. Moreover, having methods that manage the flow of materials for faster, more efficient order assembly and consolidation also add value to these operations (Jones, 2001). For example, order containers should be sent only to the zones where picking activity is required is essential and can be solved by having zone route conveyor networks or even pick carts. Most importantly, warehouse operations should adhere to better response times or less waiting so as to have dependent production processes and for customer fulfilment. In this case, implementation of information technology tactics is essential. For instance when a department requests materials from a desktop PC and that request appears on the forklift operator’s screen immediately, and then while loading the materials for delivery, the forklift operator types in the PRO number (Pick up record) and confirms that all the required materials are loaded. The immediately the billing process is initiated such that if a customer calls a minute later, he/she can have up to date details of his goods is one example of such a system that has been used by many companies (Larkins & Luce, 2000). Eliminating waste adds value to the operations of a warehouse in a big way. Eliminating of errors in a warehouse is a way of identifying activities that absorbs resources without adding value to them. Waste can be in form of poor utilization of space. Space is money, and it is a fact that it is paid for every month. Acquiring an extra space when the existing one is not completely full is wastage (Cachon & Fisher, 2000).. This therefore means that warehousing is nothing more than the management of space and time and therefore reducing waste starts with the recognition of poor use of both. And this in the long run adds value to the entire operations of a warehouse. Safety is another element that increases the value of a warehouse. It is worth noting that, the most important measure for safety is information. I.e. all the personnel in the warehouse should be aware of the safety issues by disseminating information (Cachon & Fisher, 2000).. This is enacted by posting signage announcing various considerations. For instance in a warehouse there should be clearly market concerning clearance limits, post floor loading capacity concerning joisted floors, No smoking signs in high visibility areas and indentifying the correct lifting and material handling technique through posters or any other signage. This increases safety in the warehouse and thus employees are safe to work in the warehouse. In another case, the design and the structure should also play a role in enhancing safety. The drainage system should be in such a way that is prevents accumulation. This can result to slips and other accidents. The racks and storage areas should be stable and any storage above 7 feet should include safety rails (Cachon & Fisher, 2000). In many countries all these are in the security standards. For example, B&Q warehouse in Ireland were convicted for failing to ensure a safe workplace and were fined 250,000 pounds after their fencing weighing half a tonne fell and killed a customer. Security of the warehouse plays a big role in increasing the value of the warehouse at large. One of the most important measures for security is garnering a relationship with the law enforcers. This is due to the fact that, they can provide tight security as well as make suggestions about the weak points in a building’s defences. They can also recommend the alarm system company that has the best services (Gollner et al, 2009). As for the case of bonded warehouse in UK, security is well taken care of. There is the installation of flexi-guard fence system which has intruder detection before they enter the property. This on the other hand gives the Alarm Receiving Centre and early warning of an attack on the property. Moreover, they know the names of the officers patrolling the areas. In the other case, the property should be secure. The parameter of the property should be nose tight secure. Adequate lighting is very vital around the exterior of the warehouse (Hackman et al, 2001). In GHI warehouse, there is good quality lighting provided in the interior and floodlighting in the external area making the warehouse more secure. Finally the warehouse itself should be secure from criminals and most importantly from fires. Flammable materials should be kept safely to avoid arson or any other danger that may result to a fire (Gollner et al, 2009). For example in GHI Warehouse has been built using fire resistant materials, has very clear exists and fire exists marked, fire extinguishers are situated throughout the warehouse, there has been an installation of fire detection and alarm system, smoking is prohibited in the warehouse and finally every year, fire drill and training in use of extinguishers is undertaken. In any given warehouse, inventory is a very important aspect. Warehouse operators need to have a very efficient way of tracking shipments to the distribution centres. Inventories help warehouses avoid unnecessary delays of goods, increases customer satisfaction. It is worth noting that, inaccurate customer forecasts, a multitude of changes to the original customer orders, and most importantly lack of account management causes poor customer service performance in term of on time delivery (Dekker & Goor, 2000). Having well laid inventories will avoid such occurrences and lead to customer satisfaction and thus improve the performances of the entire warehouse and thus increasing its value. The location of the warehouse is of great importance. This is due to the fact the location of the warehouse determines the cost of distribution to the market area, determined the transport requirement and facilities, cost of transportation, availability and cost of labour supply and finally the availability and cost of utilities like power, water, gas, sewerage disposal just to mention but a few (Petersen, 2000). For instance, Tesco store are strategically located near to the customers making them the easier option. Moreover, due to their locations, their supplies are much easier and therefore there is no single time there will be short of their supplies. This therefore means that, being located in a place where the customers can find you with ease is an added advantage and therefore adds value to a warehouse (Nozick, 2001). Material handling covers receiving, moving, storing, dispatching activities and inventories. This has an impact on the capital as well as on the running of the warehouse. The biggest principle of material handling which adds value to the warehouse is minimum movement. In many warehouses, forklifts, EOT cranes, pulley blocks, conveyers are some of the equipments used. However when all this are automated to combat cost and efficiency, they increase the value of the warehouse operations. For example, Global Transport and Logistic Company (GEFCO) have improved on their material handling tactics by contracting Yale Europe to be the suppliers of their material handling machines. They currently operate under little margins for error as far as material handling is concerned and they operate to the highest standards and therefore highly sought by clients. Packaging is yet another aspect that is of great consideration in dealing with a warehouse. This is due to the fact that, packaging is made to make handling and transportation cost effective. In other words it protects the products in transit and handling. It is worth noting that, packing is directed to facilitating lifting and moving by providing easy access to forts or hooks. It also displays universal symbols and other instructions of handling the products (Aldridge & Harrison, 2000). Most importantly, some packages are not focused on logistics but rather importance is given to marketing appeal and packaging the finished products. Others are meant to give a clear picture on what is being distributed and how it should be handled in case they are fragile. For example, safe-store provides its customers with a variety of cardboard boxes, bubble warp and packaging materials like saver kits, eco bubble warp, packing tape for keeping the materials safe and secure (Axsater, 2001,). Warehouses should have ample parking space so as to facilitate easy and quick loading and unloading of goods. Warehouses, involve a lot of movements of deliveries and distributions. Therefore ample parking is essential in ensuring that this happens with ease and therefore where parking space is ample, then that warehouse is valuable. Moreover, warehouses should promote safe practices (Aldridge & Harrison, 2000). This is due to the fact that, unless you give employees quality tools and the rights environment in which to do their job, they wont know how to be safe. The righty tools and safe working environments are of great importance. Ergonomics considerations are playing an increasing important role in promoting employees safety. 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Saad M., Jones M., and James P., 2002 “A Review of the Progress Towards the Adoption of Supply Chain Management (SCM) Relationships in Construction,” European Journal of Purchasing and Supply Management, vol. 8, no. 3, pp. 173-183. Xu,H., Chen, Z.L. Rajagopal and Arunapuram.,S, 2003“Solving a practical pickup and delivery problem,” Transportation Science, vol. 37, no. 3, pp. 347–36. Read More