All posts by CELSAN

How to design an efficient picking?

As Cristina, I have also been looking at the 50 proposed questions and I saw some of them about picking. What does it mean picking about “operator-to- product” or “product-to-operator”?

As we have been seeing in class, designing a picking is essential to ensure that the products arrive in time.
We have defined the picking as the work of collection in storage of the goods of a container or pallet and subsequent classification. Although it is not a task that requires a great personal qualification, it is a fundamental point in the logistics chain because, a bad management of the picking, it would spoil the rest.
The companies have to be as effective as possible with the picking to save time and money, avoiding possible incidents.

Tips to optimize picking

  1. The division into phases to know how much is being lost at each moment. In the picking, the phases are preparation, route, extraction and conditioning.
  2. Knowing the division in phases allows optimizing the work, hence it is convenient to record all movements using a specialized software tool.
  3. Although it’s not a job that requires a great specialization. It’s quite mechanical and work can be reduced exponentially.
  4. Knowing the summits of receipt of goods from the warehouse.
  5. Knowing the volume of movement of goods is essential to know if a mechanized system is needed or is for the operators.

Types of existing picking

  • Operator to product: it is the employee who moves from the receiving line of merchandise to the place of classification.
  • Product to operator: a mechanical system facilitates the merchandise to the worker until he can pick it up with his hands.
  • Mixed picking: integrates both models, being typical of large companies.

The logistic structure of each company will be fundamental, as well as the means of transport, as they will influence the final decision for the reception of the merchandise. The picking has been perfected because the merchandise was spoiled by bad management. Many people have lost a shipment or suitcase and the problem has occurred during this critical point.
Designing efficient picking is a complex task if you start from scratch but, with a series of guidelines, it does not have to be. The logistic processes respond to a determined methodology and what is demanded, above all, is a logic.

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FOUR YEARS OF OUR LIFE WAITING IN QUEUES

On the road, in a supermarket, in the emergency room, in the bank, in the chair lifts, in a concert… Everyone has had to wait in a queue.
It is true that, studying on this subject, you realize that in this society of immediacy and new technologies there are things that refuse to change. Like the queues, that waiting ordered in a row with the common goal of reaching a point to get something.

Some studies calculate that in the 21st century we spent four years of their lives queuing up. It is a sample of order without any written law, those rows of unknown persons with civilized conduct waiting for their turn to arrive.

The strategy: A single queue, in the form of a snake, is better supported than several rows without order

There are some remedies so that the wait does not seem so long and to “cheat”, creating the perception of losing less time in a queue. It is a reality that when a person is busy, the perception of time is less.
To avoid despair, it has been shown that reporting the remaining time in the queue, is effective so that “time runs faster”
(When the first skyscrapers were built in the US, many people complained about the time lost in waiting for elevators, it was solved by placing many mirrors in those areas to entertain them.)

Many of the queues that steal, on average, four years of life, are inevitable. There are companies aware of this. A well-known case is the Houston airport. His passengers complained about waiting in the luggage tapes. They hired more staff and the situation continued. The solution worked to keep the planes away from the baggage claim area. The passengers had to walk a lot more to get to the tapes. So that time was not as long as before.

Time stops: most believe that the delay suffered lasts 30% more than the real time lost

One of the advances in psychology of waiting is the idea of ​​forming a single queue, shaped like a snake. Staying in a single queue will be longer, in addition all people follow the same path, have the feeling that nobody is going to skip the line and respect the turn.
The opposite of when different queues are formed in a straight line. You have the feeling that the row in which you are going slower than the one next to you. Anxiety appears when there is a certain disorder in those ranks, which some people take advantage of to advance positions without respecting the turns.

From the reward to despair there is only one step

There are factors that contribute to waiting in a queue leading to despair:
– Waiting alone will become longer than if we go accompanied.
– Very few people get out of a queue when they have more people behind them, no matter how long they have to wait.
– The multiple queues increase the anxiety pictures by giving the feeling that the shifts are not being distributed with justice, because each row progresses at different rates. This situation has even name, the Erma Bombeck law: “The other line always advances faster than ours”.

Importance of distribution & logistics in e-commerce

Distribution is the process in which products are transferred from the seller to the buyer. If we take the concept to the area of ​​marketing we will talk about logistics as it is a broader concept. This is the area that deals with the processes necessary for the issuance of orders, warehouse management, post-delivery service and any problem that may arise from the process. Next, I will try to discover its main characteristics and its importance in ecommerce.

The most common problems in purchases made through the Internet, according to the AECEM-FECEMD (Spanish Association of Electronic Commerce), are:

Fuente: Aecem-Fecemd)

From the graph, the conclusions are:

  1. Errors in delivery create unsatisfied e-clients and damage the company’s image
  2. Bad logistics can mean the loss of e-clients
  3. The profitability of the sales process is determined by the logistic cost
  4. In order to offer a good service, the supplier must be managed correctly, delivery times, costs and after-sales service

That is why the main demands of current e-clients are:

We can also meet with technological challenges when talking about logistics and e-commerce:

IN STORAGE.

– Order-picking systems must be oriented towards small orders.
– Have a quality shipping packaging (packaging, labels, etc.)
– Agile stock management
– Offer short response times

IN THE DISTRIBUTION.

– Quality in delivery
– Have an emergency service
– Create complementary services: delivery notices, new payment methods …

IN LOGISTICS INFORMATION SYSTEMS.

– Planning of delivery times
– Route planning and optimization
– Tracking systems
– Integrate logistics information systems in the virtual store

Definitely, logistics is one of the most important aspects to have in an account for any company and is a great challenge it comes to the development of e-commerce, because it  opens up business options globally. Therefore, companies must be more demanding with themselves and take into account all the aspects described above to optimize their logistics processes.

Advantage through Distribution Networks

How to achieve a competitive advantage through Distribution Networks

After the lesson on distribution networks, I researched to complete the training a bit more and I found how to obtain efficiency on the distribution.

“The success in the market and the competitive advantage depend on distribution network”

Without efficiency in distribution networks, the success in markets and obtaining a competitive advantage could not be achieved. This is why it’s necessary to get a balance between the maximizing customer service, the minimizing transaction costs, the investment made and the risk. A solid strategy is vital to align the decisions and actions with the objectives, but at the same time, it’s interesting to take into account some of the principles applicable to the design of the distribution networks, beginning in its preparation stage, where the bases for efficiency are laid.

Previous steps in the design of distribution networks

Before defining the applicable model of distribution networks and their different scenes, it’s essential to start with these 6 steps:

ONE.
Definition of the scope
It’s crucial not to lose alignment with the evolution of the business and the transformations that implies. The distribution chain and its processes must adapt to the sales volume, the number of customers, the variety of products, the different markets where it works, the particularities of the business and the requirements applicable to operations.

TWO.
Identification of the limitations
Every project suffers from restrictions and especially talking about the logistics chain. Storage capacity, budget limits, handling requirements of each product, transport conditions, availability or risk tolerance, among others.

THREE.
Establishment of objectives
Justifying the investment and adapting to the service requirements. The objetives must be concrete, achievable and realistic. Generally, are grouped into two categories, goals related to the reduction of costs and strategies related to improving the service. Among the former, the rationalization of inventories, the minimization of storage costs, the reduction of transport costs or the adjustment of labor costs are frequent; On the other hand, the latter refer to performance or the flexibility.

FOUR.
Study of the environment
This analysis allows to detect opportunities and threats. Being a hard struggle, which implies a high consumption of effort and resources, it is a necessary step for the elaboration of the strategy and the optimization of the design of the distribution networks. Among the data collected, are the complete description of the distribution goods, the historical records of operations, the applicable transport rates and their conditions, the addresses of suppliers and customers, the service requirements and the applicable legal regulations.

FIVE.
Forecasting
Must be carried out in order to forecast the growth of demand, inventory needs and trends that will influence the management of the distribution chain; so that the actions to be taken can be planned.

SIX.
Selection of distribution network design tools
In the market there are different possibilities of solutions to design a network of this type. In the election, it should find that the selected tool includes softwares with database analysis capabilities, calculations applicable to transport optimization, specific applications aimed at innovation to improve customer service or simulators that allow greater dynamism and precision in decision making.

With these steps we can design an optimized distribution network model that will always be subject to revision, to guarantee its updating and suitability in the business conditions.

LOGiSTICs 4.0

Industrial Revolution 4.0 in Logistics?

Especially in recent years, Logistics has become one of the sectors of great growth and consolidation. In addition, it’s also one of the sectors with major changes and transformations. These changes will continue and will be accompanied by technological applications. Other challenges will be added, such as the environmental impact or working conditions.

In such a changing society where transformations take place in a matter of minutes, logistic cycles have each time shorter duration and faster and faster operations.
We just have to look at the e-commerce operations that we did 10 years ago and those that are done today. The cycles of order, preparation and delivery of ecommerce purchases are increasingly short. Nowadays, it’s considered “standardized” that in 24 hours from the completion of the order, it’s delivered at home.

“Technology as a driver of change”

The emergence of technology has already caused different changes in logistics through the transformation of operations. The introduction of barcode readers, goods positioning robots or SGAs (control and logistics management programs) are the basis of any logistics warehouse.
Surely the most important aspect is the total connectivity in the logistics chain. Through technology it will be possible to reduce efficiency errors, and with an adequate management of information, the logistics operator will obtain the progress of its procedures by reducing its production costs.

Another important aspect will be the analysis of the data generated, the big data. Through the analysis of the data, the logistics companies will predict the possible workflows to adapt structures and allocate the right and necessary resources guaranteeing the operations in an optimal way. The future of the union between client and logistics operator will be greater, producing a flow of information in real time, for good business maintenance.

Base of Logistics 4.0, the client.

Another key to the logistics of the future will be the chameleon adaptation to the client’s needs. The client will become the focus of logistics and operations will be the means to achieve adaptation to those needs.
The online channel grows overwhelmingly and immediacy will be synonymous of satisfaction, along with the personalization of the service. Thus the logistics will continue evolving in order to give a good response. But not only the immediacy will be signal logistics operations, there will be new demands in the future, as is the reverse logistics such as Spain, which is the second country at EU level with a higher number of returned shipments.
Managing returns is another fundamental role in which logistics must adapt its structures.

Conclusions

Changes and improvements that occur, won’t only be related to aspects such as technology, Big Data or robots. All this won’t work without the proper management of a human team. The transformation of Logistics 4.0 will be a mix between technological and human, with more technical profiles and good training.