Focus on Warehousing - Retail Management Systems

1 Focus on Warehousing inHARMONY 3 MARCH 2012 Today s global economy is dependent on efficient supply chains that ensure the timely flow of products. The flow occurs through a network of facilities and transportation Systems that carry product to their final destination, the consumer. Warehouse facilities are complex operations requiring the integration of people, Systems and technology to work effectively and achieve optimum performance. An important tool to evaluate warehouse performance, and indeed organisational performance, is business process mapping. Process mapping is a visual depiction of the accumulated activities that take place in each business process.

2 These activities ultimately determine the company s value proposition to customers and its overall success. So processes must be analyzed to ensure they re streamlined, meet operating standards and cost structures and, support key business objectives. Process analysis is particularly useful in identifying any disconnection between business activities and business objectives relating to customer service, efficiency, effectiveness, and profitability. Typical process mapping steps include: Process identification, meaning document and map existing processes, (AS IS Stage); Benchmark performance and establish business KPIs.

3 Measure performance to identify performance gaps, business risks and key controls in a process; Discuss with personnel their involvement in the process to obtain each individual s point of view; Determine required performance, identifying areas of improvement Document required processes, including flow charts. Is continuous improvement part of your company culture? Is it a struggle to improve your warehouse processes? Do your employees wrestle with processes that fall short of best practice? How many non-value activities are you currently performing? Focus on Warehousing inHARMONY 4 MARCH 2012 SWIM LANE DIAGRAM The primary advantage of a swim lane diagram is the ability to clearly illustrate which department, function or person is responsible for performing the activity or making the decision.

4 This approach is very useful for cross-functional mapping such as in the case of sales order fulfillment. TIP As a general rule, high level process maps should contain no more than 7 steps. The objective is to over simplify the process so it can be easily understood. SIPOC MAPPING SIPOC Mapping - SIPOC is an abbreviation of Suppliers, Inputs, Process, Outputs & Customers The purpose of a SIPOC Map: Good process Management or continuous improvement activities should commence with a high level understanding of the scope of the process first. A SIPOC Map or Chart should define the boundary of the process, and provide a structured way to discuss the process, and reach consensus before a detailed mapping exercise begins.

5 Focus on Warehousing inHARMONY 5 MARCH 2012 services from order intake to final delivery, identifying waste within and between processes. The objective is to visually present all the material and information flows across and throughout all the processes. Practitioners can drill down to discover bottlenecks and identify all value-adding and non-value-adding processes. Key metrics captured are cycle times, defect rates, wait times, headcount, inventory levels, changeover times, etc. VALUE STREAM MAPPING Value stream mapping is a method of creating a one page picture or a high level look at a company s flow of goods or DETAILED PROCESS MAPPING Detailed process mapping provides a more thorough picture of a process, capturing the inputs and outputs of each step in a process and allowing you to classify them as critical, noise, standard operating procedure or controllable.

6 By controlling inputs and measuring outputs you can improve performance and process efficiency. Detailed process mapping also helps document decision points within a process.