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Describes the Structure of a Warehouse at Steelcase
Business Processes in Practice 7.2 describes the structure of a warehouse at Steelcase.
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238 CHAPTER 7 Inventory and Warehouse Management Processes
In its massive manufacturing plants, Steelcase might have to store and maintain inventory for more than 30,000 unique raw materials for production. These materials are classified into multiple storage types, such as plastic, rolled steel, wood, and fabric. Because each of these materials has unique characteristics, each one requires different types of storage. For example, plastic parts are typically very small and can be stored in large bins in bulk quantity on a rack (Figure 7-12). A single Steelcase warehouse can have up to 15,000 storage bins for small raw materials. Rolls of fabric require a differ- ent type of space for storage (Figure 7-13). However, the rolled steel, which is formed into cubicle walls or fi le cabinets, is delivered in massive rolls that weigh several tons each. These materials are bulky and heavy and require special equipment to store and move around the plant, so they require unique storage and handling space on the warehouse fl oor (Figure 7-14). In addi- tion, raw materials must be stored in two types of stor- age locations—standard storage, which is located in the warehouse, and line storage, which is located directly next to the manufacturing line for easy access. Typically,
Steelcase prefers to have at least a 24-hour supply of raw materials located next to the production line to ensure a constant fl ow of materials and to avoid any disruptions to the manufacturing process.
Source: Steelcase, Inc. Materials Planning Group.
Business Processes in Practice 7.2: Warehouse Organization at Steelcase, Inc.
©Angela D. Gustaf, Steelcase, Inc.
Figure 7-12: Bins in rack storage at the Kentwood East Manufacturing plant, Steelcase, Inc.
©Angela D. Gustaf, Steelcase, Inc.
Figure 7-13: Fabric storage at the Kentwood East Manufacturing plant, Steelcase, Inc.
©Angela D. Gustaf, Steelcase, Inc.
Figure 7-14: Rolled steel storage at the Kentwood East Manufacturing plant, Steelcase, Inc.
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Master Data in Warehouse Management 239
MASTER DATA IN WAREHOUSE MANAGEMENT The key master data in warehouse management are material master and stor- age bins. We examine these data types in this section.
MATERIAL MASTER
We have previously discussed the material master in the context of several other processes. In these discussions we have explored several views, including basic, purchasing, and sales. If a company stores a material in a storage location that is associated with a warehouse, then it must include additional data in the master record for that material. These data are included in the warehouse management view of the material.
Recall that master data are typically defi ned for specifi c organizational levels. The organizational levels relevant to the warehouse management view of master data are warehouse, plant, and storage type. A warehouse is required; that is, materials must be defi ned for each warehouse. However, plant and stor- age type are optional and are included only when the warehouse data for the material are different in different plants or storage types. Three types of data are relevant to the warehouse management view:
Basic data are relevant to all processes, as we discussed in Chapter 2. Some of these data, however, are redefi ned for WM. An example is the ware- house management unit of measure, which can be different from the base unit of measure discussed in Chapter 2. For example, a material can have a base unit of measure in single units (e.g., one helmet) but be managed in larger quanti- ties (e.g., box of dozen helmets) in the warehouse. Data related to placement and removal strategies indicate priorities and sequences in which the storage types, storage sections, and picking areas are to be searched. Bin-related data indicate which bins are to be used to store materials as well as the minimum and maximum quantities allowed in the bins.
Demo 7.4: Review WM view of material master
STORAGE BINS
Storage bins are the smallest unit of space in a warehouse. They are the areas where materials are physically stored. Storage bins can vary in size from small containers (for nuts and bolts) to large areas for bulky materials (pallets of soft drink cases). They can be containers on shelves or designated spaces on a warehouse fl oor where pallets of materials are stored. Storage bins have unique addresses that identify their location in a warehouse. These addresses are frequently based on a coordinate system. In a shelf storage environment, for example, a bin address can include a row (or an aisle) number, a stack number, and a shelf number. Consider a library that has rows of shelves that hold books,
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240 CHAPTER 7 Inventory and Warehouse Management Processes
as illustrated in Figure 7-15. The fi gure displays two rows, each of which has three stacks. In turn, each stack has six shelves. Each unique shelf, such as Row 1, Stack 1, Shelf 3, is a bin. If further granularity is needed, then each shelf can be further divided into smaller areas. Figure 7-16 depicts storage bins at the warehouse at a Steelcase manufacturing plant.
Stacks
Rows (aisles)
Shelves
Figure 7-15: Storage bin addressing
©Angela D. Gustaf, Steelcase, Inc.
Figure 7-16: Storage tubs (bins) at the Kentwood East manufacturing plant, Steelcase, Inc.
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Master Data in Warehouse Management 241
A bin can be used to store different materials. To distinguish between quantities of different materials, the materials with the same characteristics are grouped into quants. A quant is a specifi c quantity of materials that have simi- lar characteristics and are stored in a single bin. For example, if road helmets and t-shirts are stored in one bin, each material will be identifi ed by a different quant. Figure 7-18 illustrates the use of quants. In the top left quadrant there is one quant of material A. Two materials—A and B—are stored in the bin in the top right quadrant. Each material is identifi ed by a separate quant. Quants are also used when the same material with different characteristics is stored in one bin. In the pharmaceuticals industry, for example, drugs are produced in batches, and each batch has both a specifi c expiration date and a unique batch number. When different batches of the same material are stored in the same bin, each batch is identifi ed by a different quant. This arrangement is illustrated in the bottom left quadrant of the fi gure. Finally, the bottom right displays an example in which some quantities of the material are of the stock type unrestricted use and other quantities are designated as in quality inspection. The quantity of each type of material is associated with a different quant.
Quants are created as needed by the ERP system when materials are moved into bins. After a quant has been created, the quantity of materials can be increased or decreased only by a goods movement. Moreover, when the quantity is reduced to zero, the system automatically deletes the quant. Because quants are generated as needed, they are categorized as transaction data. We discuss them here, however, to emphasize the relationship between quants and storage bins.
Figure 7-17: Quants in a storage bin
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242 CHAPTER 7 Inventory and Warehouse Management Processes
Demo 7.5: Review storage bins, and display stock in storage bins
PROCESSES IN WAREHOUSE MANAGEMENT Figure 7-18 illustrates steps in the warehouse management process. Typically, the WM process is associated with a goods movement in another process, such as procurement, fulfi llment, production, and inventory management. Recall from our discussion earlier in this chapter that a goods movement is an IM activity. When a goods movement involves a storage location that is warehouse managed, however, additional steps are required to transfer the materials into (putaway) or out of (pick) storage bins in the warehouse. In most cases, an IM goods movement automatically generates a transfer requirement. Transfer requirements are used to plan the movement of mate- rials in and out of a warehouse. The actual execution of the movement is accomplished via a transfer order. After a transfer order is created, the mate- rials are physically moved between interim storage areas and the storage bins, to complete putaway or picking activities. At that point the transfer order is confi rmed.
Figure 7-18: Warehouse management process
In this section we will consider the steps in the WM process. We will fi rst discuss these steps in general terms. We will then delve into the details of these steps as they relate to the procurement, fulfi llment, production, and inventory management processes. We will assume that all the storage locations involved in our discussion are warehouse managed.
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Processes in Warehouse Management 243
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