Manufacturers Are Finding Hefty Benefits From Lean Warehousing

By combining lean principles and material handling technology, manufacturers are gaining significant efficiency improvements.

To successfully implement lean material handling in a facility, you need to start with the right equipment, says Dick Ward, executive vice president of the Material Handling Institute of America (MHIA). To illustrate how companies are doing that, Ward offers the following case studies of manufacturers who have realigned their warehouses using both lean principles and the latest in material handling technology.

Industrial Scientific Corp.

Industrial Scientific Corp. (ISC) is a manufacturer of fixed point gas detection systems. The company's products are used in a range of industries, including oil, mining, breweries and space exploration. A rapid growth rate of 20% to 30%, however, threatened to slow production down if increased storage capacity and organization was not achieved quickly.

ISC was supplying parts to its production area with mobile carts. If its rate of growth continued, a new building was going to be required. The company considered several solutions to its storage woes, including high-bay storage and expanding its existing system of mobile carts, and automated storage. The latter option proved the right fit and the company worked with a systems provider to conduct a pilot study using one vertical carousel.

The results proved better than expected. ISC found that the 200 to 300 sq. ft. of floor space that had been consumed by mobile carts was reduced to just 67 sq. ft. with the system. Inventory control was also improved and payback was reached within a year.

Pleased with these results, ISC decided to add another vertical carousel to manufacturing and three additional carousels in other areas. In manufacturing, ISC uses one carousel to provide ready access of parts to all workers and supports day-to-day manufacturing. The second vertical carousel is equipped with software to monitor inventory. It counts numbers of parts in and out and supports day-to-day inventory control. The software supports running two different assembly lines at once, and the total volume of parts stored in the two storage units includes over 1,000 different part numbers with a total part count of six to 10 million pieces at all times.

The significant gains of the system, combined with its flexibility, have made the new vertical carousels one of the most valued systems at ISC and made the principles of lean manufacturing a reality.

Unisys Corp.

Storage for Unisys Corp. products -- thousands of computer diskettes, tape reel and cartridges that make up the company's work-in-process inventory -- is a big priority. So when the company began its search for simple automation to replace its fixed shelving system, it laid out three requirements:

The new system had to offer security and protection from dirt and dust for the products.

The system needed to include computer interface capability in order to provide accurate, up-to-date inventory control.

Most importantly, the system had to deliver sufficient increases in productivity and efficiency in order to justify its existence.

Unisys' search led it to a vertical lift module (VLM) that met the company's criteria. (A VLM, as defined by the MHIA, is a storage system that consists of two parallel columns, each of which is divided into fixed shelf locations that can hold a single storage module such as a tray or tote.) The system was such a good fit, in fact, that Unisys moved forward with 13 VLMs.

The big selling point for Unisys on a VLM was the fact that it gave the company the ability to retrieve the items they were looking for with a push of button. If a pick list has a part on each of the 13 VLMs, each unit can be in motion at the same time, allowing for a fast retrieval.

Unisys has been able to realize significant benefits from the system, beginning with much improved inventory accuracy. Efficiency has also improved by an estimated 300 percent. In addition, the company has realized significant space savings. In the same square footage that housed inventory in fixed shelving, the company now has triple the storage capacity and projects a return on investment within 18 months.

Hayes Lemmerz

Hayes Lemmerz knows well the demands required of a supplier to the auto industry. As a manufacturer of aluminum wheels for the industry, the company has made lean manufacturing a priority.

During the manufacturing process at Hayes Lemmerz, employees paint or perform other value-added services to the wheels after they have been cast. They are then buffered prior to selection and shipping. After the casting step, the company had been queuing up wheels on the floor or on conveyors as they awaited their finishing touches. The process was not only slow, but labor intensive.

To improve the process, Hayes Lemmerz designed a lean solution to streamline their operations. Using a robotic inserter/extractor device, Hayes Lemmerz can grab wheels and move them into storage in horizontal carousels. The carousels provide one wheel per location storage in the carousels and allow for individual SKU access for a more dynamic pulling process.

The results have helped streamline Hayes Lemmerz's operations. The company has been able to reduce labor as the technology requires very little human intervention. The staff can better schedule their operations as well, and they have gained flexibility in their outbound selections. All add up to a faster, leaner manufacturing process, allowing Hayes Lemmerz to remain a top wheel supplier to the auto industry.

Siemens Electrical

Labor intensive operations can not only slow processes down, but add a great deal of cost to the bottom line as well. Siemens Electrical knew this all too well and turned a cumbersome process into a lean one.

Siemens handles large spools of wiring that needs to be measured and cut into various lengths for wire harnesses for a variety of customers. The wiring is stored on a large plastic or wooden spool and then fed into the measuring/cutting machine. In order to feed the wiring into the machine, Siemens was placing one large spool at a time on a table, and then hand feeding the wire. This was extremely labor-intensive and time-consuming.

In order to find a solution to the slow task, Siemens had a carousel manufacturer design a carousel system that can feed the wire into the measuring/cutting machines. The carousel system can handle some 100 to 300 spools of wiring at a time, and can feed the spools at a rate of 10 to 15 at a time.

Siemens has been so pleased with the results -- which include a 200% increase in production -- that it has added five new carousels to the original four it purchased for its operations.

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