Warehouse Activity Profiling
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RightChain™ Warehousing Insights Warehouse Activity Profiling and Data Mining
Edward H. Frazelle, Ph.D. President and CEO RightChain™ Incorporated
“Buy truth, and do not sell it; buy wisdom, instruction, and understanding. “ - Solomon
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• The Power of Profiling
• Quick revelation and elimination.
• The Payoff of Profiling
• Purpose driven participation.
• The Purpose of Profiling
• You can drown in a lake that’s two feet deep.
The P’s and P’s of Profiling
• The Principle & Principal of Profiling • Alfred Pareto • The Practice of Profiling
• Wallowing in data stimulates fact-based thinking.
• The Picture of Profiling
• A picture is worth one thousand words.
• The Peril of Profiling • Paralysis of analysis.
Dangerous Averages
Purpose of Profiling
50%
50%
10% 15% 20% 25% 30% 35% 40% 45% 50%
The average is 2, but there aren’t any 2s.
0% 5%
0%
1
2
3
Items per Order
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Participation in Profiling
Involves key stakeholders
Facilitates design collaboration
Catalyst for cooperation
Encourages objectivity
Puts skin in the game
Raises results accountability
Leverages know-how
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Principal of Profiling
• Applied to gardening…
• 20% of the bees do 80% of the pollination.
• Applied to wealth…
Vilfredo Pareto, 1848-1923
• 20% of the people have 80% of the wealth.
• Applied to sales…
• 20% of the sales people yield 80% of the sales.
• Applied to SKUs…
• 20% of the items yield 80% of the sales.
• Applied to warehousing…
• The majority of the picking activity stems from a minority of the items. • The majority of the inventory cube stems from a minority of the items. • The majority of the shipping volume stems from a minority of the customers. • The majority of receipts come from a minority of suppliers.
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Perspectives of Profiling
Interactive Data Simulation
Interactive Data Visualization
Two-Dimensional Simulation
Three-Dimensional Animation
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• Paralysis of analysis is the paralyzing of a decision-making process due to over analyzing data and options related to the decision. • Stop analyzing and start solving the problem. • What’s the minimum amount of analysis required to make the decision? • What decision are we trying to make? • What questions require answers for making the decision? • What information is required to answer the questions? • What data is required for that information
Paralysis of Analysis
RightChain™ Warehousing Perspectives
Buyer or Planner
Supply Chain Role Raw Material, WIP, Finished Goods
Value and Velocity ABCD SKUs/Customers
Geography International vs Domestic Specific Location
Source Supplier or Carrier Commodity
INVENTORY PERSPECTIVES
Time Product Maturity Planning Horizon
Supply Chain Echelon Supplier, Factory, Warehouse, DC, Depot
Classification and Variability Seasonal, Fashion, Basic
Supply Chain Role Lot Size, Safety Stock, Pipeline, Build
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RightChain™ Warehousing Insights
Raw Transaction Data
SKU Insights
Picking Insights
Shipping Insights
Receiving Insights
Putaway Insights
SKU Profiles include SKU ABCs, SKU Pick Profiles, SKU Affinities, SKU Volumetrics, and Calendar Clock Profiles.
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SKU Master
RightChain.ai
Location Master
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RightChain™ Warehousing Insights Structure
Perspective 1
Source 1
Perspective 2
Source 2
RightChain™ Warehousing Database
RightChain™ Warehousing Insights
Perspective 3
Source 3
Perspective n
Source n
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SKU ABCs | Lines
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ABCD SKU Classification
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SKU Affinities | SKU Demand Correlation
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Demand Correlation Profile
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Item-Order Completion Profile
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Order Mix Distribution Family Mix
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Order Mix Distribution Handling Unit Mix | Pallet/Case
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Order Mix Distribution Handling Unit Mix | Broken/Full Case
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Order Increment Distribution Pallet Portion Profile
Half Pallets
Quarter Pallets
•
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Order Increment Distribution Layer Portion Profile
• A layer of cases on a pallet is a common customer order quantity. • An example from a food and beverage client is illustrated below. • Note that 80 percent of the order lines are for full-layer increments. • Our strong recommendation was that case layer picking be implemented. • A dramatic increase in productivity and throughput capacity resulted.
•
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Order Increment Distribution Case Portion Profile
Half Carton Inner Packs
Full Carton Round-Up
Order Increment Distribution for a Pharmaceutical Company
•
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Lines per Order Distribution Type I: Consumer Direct
DOUBLES Correlated assignments make doubles picking highly productive.
SINGLES Single line orders
are batched together for high pick efficiency.
MULTIs are picked in large batches with pick-pack carts.
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Lines per Order Distribution Type II: Retail/Grocery/Dealership Replenishment
Another common lines per order distribution is the mirror image of the previous figure. The peak is around ten plus lines per order. This is common in retail/grocery/dealer distribution where the customer is a retail store/grocery store/dealership. In that case, there is typically enough work to do within an order so that the order itself represents an efficient workset. Or, the order may be so large that it may be split across multiple order fillers for zone-wave picking. Another strategy is to work multiple picking policies in the same facility.
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Cube per Order Distribution
•
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Lines & Cube per Order Profile Type I: Consumer Direct
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Lines and Cube per Order Distribution Type II: Replenishment
MEDIUM ORDERS Medium sized orders are picked with carts holding 2 to 5 orders.
Order by Cube/Lines
12.00%
10.00%
SMALL ORDERS Picked with special pick-pack carts holding 10 to 20 orders per picking tour.
8.00%
LARGE ORDERS Picked one order at a time on large pick carts.
%Orders
6.00%
4.00%
2.00%
<1 1 - 4.99 5 - 14.99 15 - 29.99 30 - 59.99 60 - 89.99 90 - 149.99 150 - 500+
90 - 149.99
0.00%
30 - 59.99
1
2 -5
5 - 14.99
6 - 10
Cube per Order
10-50
<1
51-100
Lines per Order
100-200
200-300
300+
Lines & Cube Profile for a Major Retailer
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Cube Movement Profile
25%
20%
20%
15%
15%
15%
12%
10%
10%
8%
10%
% Items
5%
3%
5%
2%
0%
<0.1
1,000+
0.1 to 0.5
.5 to 2
2 to 5
5 to 10
10 to 50
50 to 100
100 to 250
250 to 1,000
Cube per Month
Cube Movement Profile for a Major Valves & Fitting Distributor
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Handling Unit Inventory Profile
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0% 100.0%
Cum % of SKU's Cum % of Pallets
Lane Depth Optimized Floor Storage
Two-Deep
Push-Back
Single Deep
Pallet Rack
Decked
Racking
Three-Deep
Push-Back
Number of Pallets on Hand
Inventory Activity Profile for a Major Office Machines Company
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Month-of-the-Year
Non Cross-Trained Staffing Requirement
Cross-Trained Staffing Requirement
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Week-of-the-Month
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Weekday Activity Profile
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Hour-of-the-Day
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Exercises • Profiling Practice
Name three inventory activity profiles that you don’t have, would like to have, the decisions they would influence, the required sources of information, and associated queries. • Profiling Priorities List and prioritize the ten most important data elements to support inventory planning for a particular item. • Units of Measure List the pros, cons, and applications for measuring inventory levels in turns, days on-hand, leadtimes on-hand, $value on-hand, cube, and weight. • Pareto on Profiling Name as many examples as you can for how Pareto’s Law might work in inventory management.
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