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Lean in Distribution (Part 2 of 3): Lean Tools

There are many lean tools that can be effectively used in distribution, but tools by themselves provide little value.  Lean is more about achieving a culture of improvement in employees’ minds, and building a flexible system to drive out waste and better meet customer expectations.  Tools should be thought of as examples of lean activities that may be applied to processes. 

Many times, the best lean tools are unique to a particular business.  Examples can include customer software development, wireless warehouse capabilities, special carts to increase picking speed, moving desks and tables to allow for faster processes, and activating ERP system capabilities not yet utilized.  However, basic lean tools are the way to begin a lean implementation; here are several of the best ones that fit well in distribution.

5S - 5S is a way to organize distribution functions to eliminate waste and errors, and increase efficiency and employee morale.  5S is a great tool to start a lean implementation because it is easy to use, makes a visual improvement and is usually successful.  5S stands for Sort, Set in Order, Shine, Standardize and Sustain.  The layman’s view of 5S would see it as “cleaning up.”  However, 5S is much more powerful than first impressions.  5S is about eliminating waste that is slowing processes down.  It is about becoming more organized and standardizing work areas.  Utilizing 5S allows distributors to see waste and therefore eliminate it.     

Lean Warehousing - Lean warehousing means designing a distribution system to create efficiencies and eliminate wastes.   Basic lean tools for warehousing include:

  • Moving Similar Products Together
  • Storing by Amount of Product Usage
  • Having a Separate Location for each Item Number
  • Storing Product Vertically when Possible
  • Storing Product within Easy Reach of Workers
  • Storing Heavy Product Low

The lean tools above are combined with basic distribution best practices such as dock-door assignment, advanced shipping notice, cross-docking, system-directed put-away, and automated scanner and bar coding practices.   Basic lean warehousing is a key step to gaining an efficient and stable distribution environment.

Visual Management - Visual Management is a way to monitor and adjust daily operations to assure that daily distribution goals are achieved.   With the advent of complex ERP packages, there has been a loss of touch with the actual warehouse, or a separation between the office and the warehouse.  If a distribution owner were to walk out to the warehouse, could they tell how things are going?  Is everything going to ship on time today?  Are we behind in putting inventory away? How many shipping errors happened this week?   The answers may be difficult to find in the distribution system. 

What if every employee knew how the day was going?  That is, they knew exactly how fast they needed to work in order to get everything shipped.  Everyone knew when picking or shipping errors occurred and who was responsible.  Visual management is about everyone understanding and striving to meet daily operational goals.

Standardization - Standardization should use employee consensus to determine one best process, to assure that everyone does things the same way and the best way.  This eliminates variation and errors as part of the process.  It also allows individuals to present their best practices to form a standard that comprises the best ideas of all employees. 

Work Procedure Documentation is a key standardization tool used in lean distribution.  Work procedures also allow new employees to be trained faster and more efficiently, by ensuring that they are doing processes correctly from day one. 

VSM – Value stream mapping is perhaps the most effective tool for seeing and eliminating waste in distribution.  Value stream mapping is similar to process mapping, but adds several powerful layers of analysis.  Value stream maps not only chart process steps, but more importantly, give insight into the overall value of a process.  Before-and-after value stream maps are utilized, with the goal of increasing value.  Value stream maps help distributors re-design processes to gain measurable efficiencies. 

In our next blog, we will discuss the importance of having management commitment to launch and sustain a lean organizational culture using these tools.

Stuart Maxel is Continuous Improvement Manager at Epicor Software

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