Strategic Warehouse Management - Assignment Example

STRATEGIC WAREHOUSE MANAGEMENT Strategic Warehouse Management The value chain The value chain is a very important aspect if one was to gain competitive advantage. It has a very significant implications for supply chain/logistics/distribution. Value chain is divided by primary activities and support activities. Primary activities include: Inbound logistics such as warehousing and stock control Operations covering production and other activities that transfer inputs into outputs Outbound logistics that involve activities that involve techniques which will make products get to customers Marketing and sales covering techniques that will make the customers know about the products. Service includes the support for all activities such as installation or returns Support activities that include: Procurement Technology development Human resource management Firm infrastructure From the concept of the value chain, a simple made can be made to make sure that the value chain is efficient or effective. The support activities that I would apply for inbound activities include technology to manage and control stock. Packaging will be enhanced by purchasing the right items, output logistics such as transport will be supported by updating the infrastructure that will improve the speed of transport, sales and marketing will be supported by use of technology that enhances online marketing. I would recommend that human resources be trained to ensure that they add value. 2. Demand Technology Demand can either be independent/random, which means that it is independent of all other products. This demand relies mostly on re-order point (ROP) systems for inventory management/replenishment. Dependent/predictive is derived from consumer demand which produces ‘end use’ product or services. The best method that the organization can adapt is the replenishment method, where the dependent demand is MRP and the independent demand is ROL. The time taken for a product to reach the customer is called the replenishment time. When the stock in the warehouse has been released, it will be then re-ordered, production schedule will depend on the ordering level of the customer. I would recommend safety stock method to supplement replenishment method, this will ensure that there will be no stock-out. Sometimes there will be instances of stock-out due to a wrong forecast in the replenishment time, this can increase the demand of the products. It will therefore be the safety stock that will ensure that everything has been taken care of. Other instances is that there might be excessive demands that are more than the master production schedule (MRP), safety stock will again give a remedy to this situation. 3. The Yogurt Company and Security The Yogurt Company’s perimeter is fenced with only one entrance only, the fact that there is only one entrance there will be loopholes in the security. It would be best if the company had as entrance and exit of the premises. When this is done, it will be easier for security check to frisk exiting persons and those entering the premises. The fact that parking is allowed in the premises can be a source of security breach, there should be a section that should be secluded for vehicles parking only. The secluded place should have an entrance and an exit point with again guards at each point to ensure that there is no yoghurt that will be sneaked into the vehicle. The CCTV system in the premises are adequate but the problem is there are only two CCTV cameras watching externally. The security firm should be advised to add more cameras to watch externally, which will ensure that there is more surveillance of the premises from outside. I will also recommend that the footage of the CCTV cameras to be linked to my office and other senior managers, this will ensure that anybody who tries to liaise with the thieves will not be able to do so since there is a third party watching. 4. Live Racking at B.M.W Pallet live, mobile line side live-storage and carton live are features that can are used to make sure that the plant at BMW will achieve a 39 seconds cycle time for the engines which support the BMW group’s production network. But this cycle time can be reduced to 30 seconds if some other modernized techniques are implemented. It is important to note that live racking is use to make sure that there utilization of the floor space, and also live racking can be used to automatically position pallets on a First in-First out basis (FIFO). Storage and component delivery system does not epitomize a 21st century enterprise as Hughes says. The components within the bays are located in such a way as to allow the components to be picked sequentially, exactly in a manner that they will be require at the production line. This is not necessary and it is a source of lagging, the vehicles that are running throughout the feed aisles should be done away with. The engines used should be made faster by increasing their power and performance if the cycle time was to be reduced to 30 seconds. 5. System Implementation One of the risk that was been experienced in the former organization is the issue of recording system. The recording system was not efficient enough nor effective enough. This prompted theft of some stock since the perpetrators didn’t knew that they won’t be caught. The best technique that could be applied to fix this problem is ensuring that a proper ICT system is employed in the warehouse. An efficient ICT will ensure that the recording system is fixed, any unit manufacture will be recorded as well as any unit leaving the warehouse. It will also be possible to record a defective unit, this will ensure efficiency curb the risk of smuggling of goods due to lack of a proper recording system. There was a risk of experienced staff leaving the warehouse, which left a huge vacant as the efficiency of the warehouse was tampered. This are people who were given and trusted to handle machinery such as forklifts and operations of convey belts. It is thus very important to make sure that on-job training of new employees, and ensure that there is assistance personnel in each critical position that can interfere with the efficiency of the warehouse. 6. Two potential safety issues that my current organization could be facing Fire hazard is a safety issues that my current organization is susceptible to. There are minimal provision for fire safety in case of a fire emergency. The organization lacks proper use of lockout procedure, has no provision for fire extinguisher, the workplace is poorly ventilated in high risk areas, it has no emergency doors, has failed to offer protective equipment and clothes for the workers working in high risks areas. The machines and equipment used also poses great risks of causing fire in the workplace. Furthermore, the employees lack an emergency plan that can be used to counter the risk thereby preventing vulnerability. Employees also face the risk of suffering from chemical burns. Potential sources of chemical burns are hazardous materials that workers encounter on their daily operations in the workplace. The major problem is the lack of proper communication and workers sensitization about proper handling and care when applying chemicals. The company has invested very little to training employees about the risks associated with the use of different chemicals, effective cleaning of spills, wearing protective gears when using chemicals and proper storage of chemicals. A reduction in chemical burns can be effected if the organization invest more on safety measures. 7. Challenges faced when trying to implement 5-S and ways to overcame them It is difficult to distinguish between necessary and required items from a heap of items as some items have sentimental attachment even when they do not serve any purpose at all. Sorting items depending on the time they are to be used is a time consuming and tedious job. To overcome this challenge, it is prudent to understand the order items that are no longer in use so that they can be traced easily whenever they are needed. When it comes to making the implementation of the 5-S a habit, it means replacement of all the previous habits. Organizing and cleaning the working areas can be a tasking activity but, forming a habit requires intrinsic motivation to be able to forget the old habits and form new ones. To overcome this challenge, it is better to find something good and enjoyable to complement the cleaning. Such activities could include color coordination to make the working area more attractive and appealing. After forming the habits necessary to ensure perfect organization, the hardest thing is to convert from being a reactive person to being a proactive person. That means that you possess the ability to foresee distractions in the normal organization of the working area and take the necessary steps to ensure that mitigation measures are taken on time. To overcome this challenge, one should maintain a list of all the activities to be undertaken in the future in order to prepare for items needed and avoidance of items that will not be needed easily. 8. Third Party Supplier Relationship Management The preference for third party suppliers has become a trending phenomenon in the business world lately. This is because businesses are moving towards exploration of new ways of cutting costs by accessing specialized expertise that adds value to the business. Third party suppliers helps the business to not only save on costs, but also improve on the quality of services and products through increase innovation. Third party suppliers are also influential in helping the business whose aim is to encroach into new products or services to use the expertise of the best in the industry to boost their market share by satisfying the specific needs of the clients. Many businesses face a threat of depending largely on a single vendor as it is associated with many risks. However, third party suppliers enables the businesses involved to break from the existing arrangements and use a vendor that delivers services in a cheaper and valuable way. For effective application of third party suppliers, strong governance structure should be implemented for effective relationships through mutual respect and support. Other than saving the cost of production and adding the overall value of the business, third party suppliers benefits the business through achievement of flexibility, in the market in terms of meeting demand, integration of business strategies and its operations and enhancement of reward incentives. 9. Requirements of a Warehouse Manager Position A HND or foundation degree. A degree is important as it indicates the level of competency of the candidate in terms of handling the work. A candidate with a degree or masters in supply chain management or logistics does not only have the ability to handle his work perfectly, but also helps in coordination of tasks among employees for achievement of the common goal of the business. Industry experience is also very important as an entry requirement of a warehouse manager. A warehouse manager requires prior experience in a warehouse where he is believed to have gathered work-related expertise necessary in making great business decisions and implementation of such decisions in a way that benefits the overall performance of the business. While academic qualifications are important in becoming a warehouse manager, having the necessary experience guarantees an employee of competent as well as proficient manager. Excellent management skills such as oral and written skills, numeracy, teamwork ability, conflict resolution, decisiveness, organizational and planning skills as well as problem solving skills. These skills are important as they help a manager in better coordination of tasks and other employees. 10. Warehousing Aims/Ideals Customer awareness: customers in m organization are considered the pillar of business. Customer satisfaction is one of the most important methods of ensuring that the organizations attracts new clients, but it also ensures that customers who have already been attracted are retained in the business. This is done by increasing the number of referrals and word of mouth promotion by satisfied customers. As such, satisfying our customers ensures that we get constant new business thereby increasing the sales volumes. Variety: increase in the variety of services offered in the warehouse increases the tasks to be performed in order to meet the needs of the clients. When clients visit our organization, they are sure to get a range of products depending on their needs. This is because we believe that offering a range of products will play a huge role in increasing the number of loyal customers for the business which in turn leads to increased sales. References Baker, Peter., (2007); An exploratory framework of the role of inventory and warehousing in International supply chains, Emerald Group Publishing Limited, . Briggs, J. Andrew., (1978); Warehouse operations planning and management, Robert E. Krieger Publishing company, Huntington, New York Carlson, Brian., (2005), Supply Chain Execution: Looking Beyond the Four Walls of the Warehouse. David, J. Viale., (1996), Inventory Management: From Warehouse to Distribution Center, Menlo Park, CA, USA: Course Technology Crisp. Frezelle,H. Edward., (2002) World class warehousing and material handling, McGraw Hill, USA. Harvey, J. & Brudenall, P., (2008). Risky Business, High Payoffs. Forbes. Hompel, Michael Ten., Schmidt, Thorsten.,(2007), Warehouse management: Automation and organisation of warehouse and order picking systems, Springer-Verlag Berlin Heidelberg. Lumsden,R. Kenth,R. (2006), Fundamentals of logistics, Chalmers University of Technology,. Mentzer,T. A.v John. (2001) Supply Chain Management, Edition: 2,Publicerad av SAGE. Read More