Wisdom for Warehousing Transcript

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Wisdom for Warehousing: The Optimal Role(s) of Warehousing in Supply Chains and Business

Edward H. Frazelle, Ph.D. President and CEO RightChain™ Incorporated

D...rw. Eed'vFergazoetllteo(v0a0l:i0d0at:0e0t)h:at. That one, we've got to validate just to make sure. All right, ww ea 'rreeh oguosi ni ngg toor ad os etmh ri ne ae r aonndwaa rheahlof uds ai nygs oornl ewc taurreehoonu swi nagr .e hAonuystiinmge, I Ia ltwe aacyhs sat acrlta isns t oh ne same place, which is, why in the world are we going to spend three and a half days or one hour or 10 minutes even talking about warehousing when everybody's trying to get rid of the warehouse? And when I wrote the book on world-class warehousing, I reevmereymbobdeyr'spteroypinleg taoskgientgridmoef, t"hWe hwyaraerheouysoeu?"writing a book about warehousing when

Section 1 PriceSmart vs Domestic Warehouse Club Supply Chain Configurations RightChain™ Warehousing We literally wrote the book on warehousing.

Authored by Dr. Ed Frazelle, RightChain’s founder, and published by McGraw-Hill, World Class Warehousing is the world’ s authorita�ve resource and guide on warehouse op�miza�on , best prac�ces , metrics , analy�cs , and systems .

World-Class Warehousing is the world’s most widely read and adopted book on warehousing principles, practices, and systems.

(A0n0d:0I0t:h4o1u)g: ht, "I better come up with a good answer to this question or nobody's going to ri se abda st ihciasl lbyo, owkh, "y asnhdo suol dI yl iot eur rael laydwaebnot obka cakb ao nu dt wr eawr er ho ot eu tshi negf?i rTs th ce hraepatl eqr uoefstthi oe nb bo eo hk i, nwdhti hc he question is, in what way does a warehouse add value in logistics, in business, in supply chain management? And if we can't come up with some good answers to that question, we mv eirgyh ts haos rwt se el lmgion aoru. tI ' amn da spkl ianyg gt ohlef gs or oyuopu bcaasni c ga el lty ,a wf ehwy sr ho ou un ldds wo ef gs oplef ni dn . tTh hr ei se caonudl da bhea laf dbuayssinsetsusd?yAinndg twhaerfelohoorusisinogp?enInfowrhsautggweasytisodnso.es warehousing add value in logistics or in

Though often denigrated as a “necessary evil”, warehouses provide value to businesses and supply chains by many means. (A0ll0r:0ig1h:4t,2w):e're going to take some notes on this, and we'll call this warehouse value added. Ia na dp ot lhoegyi zgea ivne aydovua, nCc ewfaosr cmo my mh aennddwa br il tei ,n Sg . wT ahsi s s ga ot ies sf aac ltlo trhye, Nw awya bs anceke dt os ti hmepsr ioxvt eh mg er na dt . e I, tChsi na kn dt hI ewy owuel rde gaeftr aNi ds ionf tmwaok ianrge ayso: uo fneee lwt aoso ibna hd ainf dy wo ur igt iontga annFd. St hoeuos tuhael lry w, I aws ot aullkdi ng ge tt oa lol mc aunc' th ,s pa ne ldl ivte' sr yt hwe eslal ,mi fe ytooud awy .r Ii tt e' s sj oums t elti kh ei ntgh apto. oArnl yd et nh oe uogthh,e pr et ohpi nl eg Iwdi lils ci mo vaegriende itsh ai ft yiot 'us sa pn edl ltehde cno irtr' se cmt l ya .g Tn hi f ai et 'ds by oy utrr ypihnigl otsoo pwhryi t teo oo .nYtehaihs , si tc'rsebe ene. nA wn yowr kaiyn, gt hf oart ms aey sf o, r" Wa laornegh ot iums ee Value Added."

The Many Faces of Warehousing

Manufacturing Line Support Finished Goods Storages

Na�onal Rail Receiving Piece Pick E - Commerce Distribu�on

Global and Local Receiving Case Pick Local Retail Distribu�on

Finished Goods Receipt from Produc�on Seasonal Finished Pallet Frozen Storage

Global & Na�onal Container Receiving Auto Dealership Daily Truck Delivery

Global & Na�onal Container Receiving Omni- Channel Distribu�on & Returns

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The Many Faces of Warehousing

Off Site Produc�on Receiving Piece & Carton Pick

Global & Na�onal Container Receiving Piece Pick, Carton Ship

Global & Na�onal Container Receiving Aerospace Assembly Pick and Kit

Global Container Receiving Piece Pick, Carton Ship

Na�onal Truckload Receiving Aerospace Assembly Pick and Kit

Global and Na�onal Stuffed Container In Piece Pick Parcels Out

RightChain™ | Supply Chains. Solved.

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The Many Faces of Warehousing

Plant Warehousing Customer Pickup

Asia Receipt Processing & West Coast Store Fulfillment

Seasonal Finished Goods Storage

East Coast Trans-loading 40’ Stuffed Ocean Containers In 53’ Palle�zed OTR Containers Out

Produc�on Lot Size Economies & Store Replenishment Full Truckload Single SKU Pallets In Stop Sequence Mixed Pallet Route Trucks Out

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(00:02:48): JYi me s . sTahi de ri et ha er el pesccoonnonme icet st ho ef sdcoa tl se . i Fnoar seuxpa pml yp lceh, ao inne. Wi s hmaat neul sf ae cdt uo ryi nogu ewc oa nn ot mt o i ea sd do f uspc ahl ee r. eI n? pt hr eordeu' sc tui os un a, il fl yy ao ul o' vt eo gf oi tt, aa nl odnigf ypor uo dhuacvt ei otnh ar tu, nt hoerr ae lmo ta ys i bz ee , sI ot mh i en kg oi to' sd craelal es do nas l yo ot ub ehcaavues ae be xi gp el onts si vi zeet bo esceatuus pe mt haeymb ea ci th ti na ke er ys ys oo uwah leonnyg otui mg ee tt oi t sseett uupp ,t hy eo um' raec hg oi ni ne rgyt, oml ae yt bi te riut 'ns fvoerr ya lpornogd ut icmt i oe .n Tl ihnee , roera lr eadnus wc ee hr ,o owf mc ouucrhs ei t, ci so sttos ryeoduutcoe ghoo twh rloounggh i tt htaatkpe rs oyc oe sus ,t ob usteitf uy op ut' hv ee db eo nae laalrl gyeo ul o ct ,a na ni dn tthhaatt al roet a i sa ncda lilte' ds sitni lvl eenxtpoer ny .s iIvt ehaans dat askpeesc iaa ll onnagmt ei m, iet ,' st hcearl el e' sd glooitn sgi zt oe iTnhvaetn'stocrayll,eadnadwwaer'evheoguoste.to have a place to put that. And guess what that place is called?

When production changeover costs are expensive and/or time consuming, longer production runs may be optimal for the supply chain and the business. The resulting inventory, called lot size inventory is naturally housed in warehouses. (T0h0e:r0e4:a0r3e):other economies of scale, though. A second one is procurement economies of st oc abl eu. yF os or me xeat mh i pn lge , oi nf ysoaul eg, erti gahnt o? pWp oe 'rvt eu ngiot yt tt oh eb uh ya lsf -opmr iecteh isnagl ea: t yhoaul f gpor ti cteo, ebvee rcya br eofduyl lwi ki et hs tohbasto bl eesccaeunscee tahnedr ei 'ts' sannoitn fvreene t toor ys tcour rei na gl l coof st th at ht ai nt vg eone tsowr yi ,t hb ui tt ai fnydo tuh pe ruet ' sa ltl ht eh opsoet ennutmi abl ef or sr at og api nr os tc ut hr ee. dTehc ai st i' os na, ni t esct iol ln mo ma yy boef as cgaoloe d, bi du et at ot ogteatk et haed vdaena lt ,a yg oe uo fgtohta tt os pbeucyi a al ol po tp oorf t ui tn. iSt oy ahgaavient, ot hsat ot rbei gt hcahtusnokmoefwi nhveerne .t oArnydt wh ahtact o' smt heas ti ps lcaaclel ecda llloetdsai zwe ai nr evhe on ut osrey. a n d p h y s i c a l l y w e

Special opportunities to procure including end-of-life inventory for key products and significant discounts for products with low cost and likelihood of obsolescence may justify large inventory acquisitions.

The most expensive cost components of getting chocolate candy to the shelf is sugar, cocoa, and manufacturing. As a result, candy companies take advantage of low prices on sugar and cocoa and procure in large quantities. In addition, since the shelf life is long and the probability of obsolescence is low, they make large batches of candy at once. The procurement and production lot sizes are housed in large warehouses.

(T0h0e:r0e5a:0r6e)a:lso transportation economies of scale. The trend today is to move everything in sr emdaul cl eer i annvde ns tmo rayl l. eHr oqwu aenv tei rt i, ews .eOsrtdi lel rws ai znets i anreex pg ee nt tsi ni vge stmr aanl lseproarnt adt isomn a, lsl oe rt. hWe hoyn il sy twh aa ty? wT oe ct raunc kml oa ka de ot hr oas feutl wl coo ni dt ae iansewr . oWr kh et or eg edtoheesr tihs attohcaopmp ebni n, eb ya ltlhoe f wt haoy s? eAst mt hael l wo ar dr eehr so ui ns teo, tah af ut 'lsl right. Those are some ways that a warehouse adds value in business and in logistics.

In order to achieve transportation economies of scale, small order quantities must be consolidated into large shipments. Warehouses are natural places for that consolidation to occur.

(W0h0a:0t5e:l5s4e?):That's a lot, but there's some other ways the warehouse adds value. Yeah, Rob? Ec ux sc teol lme ni zt e. Pt ohset pi novneenmt oe rnyt iosr t ht heei doer ad et hr . aTt hy eo ui dwe aa i tb ea isn lga taenays dpeogsrsei eb l oe f i ns pt ehceusl autpi op nl y tchhaat i ny ot uo wc uosut ol dmdi zoa pt iroino ,r otfot ernetciemi veisn cgatlhl eedoprodsetrp iosnae mr i sekn tt,hi as tnyaot uu r' rael l yt aekxi ne cguwt ei dt hi ni ns vi deen tt ohreyw. Tahr eaht of iunsael bcuesctaoumseert.hat's where the inventory is, and that's the last point before it goes to the

Warehouses are natural homes for value added services and order customization. Monogramming, like that provided as a popular customer service and product differentiation by LL Bean is a classic example. (W0h0a:0t'6s:4a2n)o:ther way? Good, Steve: consolidation. Consolidation is a transportation benefit, bc oumt ipt 'asnayl swo ea' vceuds toonme ear lsoet rov fi cwe obrekn ewf ii tt .hLoevt 'esr stahye I y' me a or sr.dTe rhienyg' rfer oomn eLo. Lf . tBheeabni, ga nmda itlhoart 'dsear cwaat anltotgh ec osmh iprat naineds . tIhf ey opua i ro rodf epraan tsshtior t caonmde ai np at hi re osfa mp aenpt sa cf kr oamg e La.tL .t hBee as na m, neotrimmael liyn yt ohue same day.

When ordering two or more items from a mail order or e-commerce provider, those items show up at the same time in the same delivery. For the most part that requires having them under the same warehouse roof. (Y0o0u:0d7o:1n4't):want the shirt coming one day and the pair of pants coming another day, el osopke ci ina ltlhyei fc ay toaul osgh oa np dt hpeu wt aany oI udtof i at nt odgIeht ha evre aanhda sr adyt, i "mTeh aptu st thi inrgt awnadr dt hr oa tb epsa itro og ef tphaenrt, sI wc ai nl l bt oe bf ien ue nt do ge re tthheer .s"a Fmoer rt oh oa ft st oo thhaepyp ceannt ob de apyi ,c pk eh dy stioc ga lel tyh tehr e, ssoh ti rhte ayncda nt hbee psahi irpopfe pd atnotgse ht haevre, smoetrhgeey- i cna- nt r abne sdi te lwi vheerreed tthoeg esthhi er rt . aNnodwt ,hwe ep' lal i traol kf apbaonut st ac ol ougl di s tbi ec si nm do di f ef el rae lni tt t fl ea cl ial ti teire sc,a al lne dd tshuep ps hl yi pcphiani gn ,i su ssuy anlcl hy rtohnei zs oe dr t ti no gt hc ee nptoeirnftowr ht heer ec at hr reiye rc, oamn de tt oh ge ye t' rhee ar tat ta cahceedr ttaoi gnept ho ei nr taitnt ht haet point. But outside of that today, they need to be under the same roof. C o (0 n o 0 n ly : s 0 o o 8 l n : i 0 d e. 6 a V t ) i : a o l nu ei s- aad cduesdt os me revri cseesr va ircee ubseunael lf yi t pt he ra ft ocromme eds i fnr ot hme ww aarr eehh oouu ss ien. gR, ebtuutr tnhsa, ty' so un oc to ut hl de lroeot ukr na ts ?a sI t 'as uc us us taol lmy etrh es eprlvaiccee cbl oe ns eesf itt .t oWthhye icsu st thoemwe ra.r Te hhoeups he yas i cnaalt uf arcaill ipt ileasc ey ot uo ne xeeecdu ttoe plortoocfemssarneutualrlnysinatreentshiveesaacmtieviutys.ually that you need for order-picking and put away and a

As odd as it may sound, returns processing is a means by which warehouses add value in business and supply chain management, especially as a customer service. (00:08:52): Awneo' rteh egro ionnge tios fhi lal vrea ti en.vFeinl lt or ar yt e oi ns ah ra enfde rteon scaet ti sof yt h. Te hpaetr' cs egnot i on fg t thoe rceuqsut oi rme ear 'sspde ec mi a la nt ydp teh oa tf ipnhvyesnictoarl yspcaaclelecdallseadf?etAywsatroechko. uTshea. t safety stock occupies physical space. What's that

Safety stock inventory allows companies to provide high fill rates to customers. That safety stock inventory is naturally held in a warehouse, as close to customers as possible to reduce customer response time.

(Q0u0a:l0it9y:2c5o)n:trol is another way that the warehouse can add value because that's where the go onowd ist ha rteh:ewg eo ocdasn i pn us itdtehtehme wu nadr eehr oquusaer. aAnnt yi nt he i tnhgeer les, ewyeo uc awn avnits ut oa lal yd dm? a n a g e w h a t ' s g o i n g

Configured accordingly, a warehouse may be an excellent space for quality control via visual inspection. Managed properly, warehouse locations holding products that have not cleared quality compliance may be blocked from access until clearance occurs. Response time, excellent. We'll put that under customer service. We have a client in the Sc ui l si ct oo mn eVra lwl eiyt,h iann dt wt ho e ihr ocuurss t oomf erre cseeirvvi ni cge tphoel i coyr ds ea ry s f rtohma t tt hh ee y cwu si tl lo mh aevre. Ng ooowd, s t ht oe yt'hr ee sc ue tpepr oa r: ttihnegyccuasnt o' tmbeer tsoi nt hToesleApvl iavc, easnwd iTt ho ikny ot w, aonhdoTuhr sa ifl raonmd , Sa annd JToes ne ,nCe as sl ief oe ,r na ni ad. TT hu er yk ehya, veet to have physical warehouses very close to the customer.

Warehousing and the Value of Time Warehouses in close proximity to the customer baseand with short internal cycle �mes help to reduce response �mes to customers . We have one client that provides same -day delivery of cri�cal service parts. The company accomplishes this with a na�onwide network of small warehouses with short order cycle �mes . One of our financial services clients supports its financial analysts with small warehouses located in the centers of major financial districts, serving financial service offices via subway,courier, walking ,and bicycles. One of our convenience store clients is increasing product freshness by increasing delivery frequencies to its 14,000 stores supported by a major increase in the number and capacityof its warehouses and distribu�on centers. The current master of warehousing and the value of �me is Amazon , leveraging warehousing to provide high availability of popular SKUs within hours of the large swaths of the US and soon to be global popula�on .

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(A0n0y:t1h0in:2g3e):lse you want to add? Yes, ma'am. There are a lot of roles that a warehouse can pc al any .bOe nae wc oaur el dh obuesae dains dt r itbhuet iporni mc eanr tye rm, wi s shiiocnh oi sf ut hs ue awl l ya rwe hh oe rues eo ri ds esrtso rairneg afsi snei smhbe lde dg.oOo nd es if nu vl fei lnl mt oernyt, ocre ni tt ecro uwl dh ebree r ai tws mmaati enr i ma l si s. sIitosnmias i np rmeipsasri oi nng i so rs dt oerrasg ef o. rI t dc oi ruelcdt bdee lai nv eor yr d et or sl ootmoefb ot hdiyn' sg sh oi nm ec .oImn smi doen .t hMe afionul yr , wt ha lel sy ohf aavlel orfetcheoi vsien gb,u ipl du itn- agws aI yj u, sstt onraamg ee,d ,pti hc ke iyn hg ,a vaen da ss ho mi p ep ilnegv .e Sl . oB, uetv ea rl syob, oedvye rbyebl oi edvye' ss wt haeri re hwo aurseehios ut shee issa mu nei qi nu et h, aa nt dy oouf hc ao vuer st eh ot hs ee ya' cr tei vriitgi eh st . aI tt mm iagnhyt vbaer i ma t ai oi nnlsy oaf rwo ua rnedh oi tue sme spoi cukt i tnhge roer. Sc ao s, ew pe 'ilcl ktianl kg mo ro rpea lal be to upti ctkhiantga. sTwh eer ge oaar leonn' tg , t bh ua tt at least for right now, I'm including all of those names in this discussion.

Warehouse Ac�vi�es and Flows

Warehouses come in many shapes and sizes, however , the vast majority include the following ac�vi�es and areas . 1. Unloading 2. Inbound Staging and Inspec�on 3. Pallet Putaway 4. Pallet Storage & Retrieval 5. Case Picking Replenishment 6. Case Picking 7. Each Picking Replenishment 8. Sorta�on , Order Assembly , and Packing 9. Outbound Staging 10. Loading

Broken Case Picking

Case Picking

Pallet Storage and Retrieval

Case Pick Replenishment

Each Pick Replenishment

Order Assembly

Putaway

Cross Docking

Inbound Staging & Inspec�on

Outbound Staging

Unloading

Outbound

Inbound

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(A0ll0r:1ig1h:4t,0s)o: what might be another way the warehouse could add value? Anything else you wi s at nh ta tt ot haed gdo? oAd sf rceaen t rc ao dmee zionnt oe . t Th he ewbaar seihc oi ud se ea , iann ad ft rheeey 'tvr ea dneo zt onne ec eosrs aar bi l oy ncdl eeadr ewda cr ue hs tooums es ya ne t :a rs eoamwe bhoedr ey ' ws ge odi no gn 'ttohcaovme et oi np amyady ub tei el as toe nr at hn ed ghoeol pd st huenmt i lc tl ehaery cl ue as tvoemt hs .eAwl saor, eiht omuasye boer db ee pgeonoddi nf go ro ns ewc uhrei trye, tihf et yh 'er ewgaorienhgo, ut hs ee ries md easyi gbnee nd opdr ou pt ye rpl ya yamn ednitf at th ea l wl . aS roemh eotui ms ee ist si te lcf ains secure.

A bonded warehouse, sometimes called a customs warehouse, is a warehouse within a warehouse or a warehouse unto itself where goods may be held awaiting customs clearance and for which duty payment is delayed until the goods depart the bonded warehouse or related free trade zone.

(T0h0e:r1e2's:3a8l)s:o risk mitigation in the supply chain. The odds of a particular type of so-called nd iastausrtaelr dhiaspa ps teenr hhearpepaernei na gc t uaar el l yppr reet tt yt y l ho iwg h. .TShoe I oadl wd sa yos f t es lol mo ue r tcylpi een tosf, "s oP-acratl loefds encaut ruirnagl tahne esaurpt hpql yu ac khea i on r i sa ttheirnrkoirni gs t t hi nrcoiud ge hn twohr awt ahraet etvheer ?r "a mI f i fyi oc aut irounns ti hf aa t hl ui srtr iocuatn, et hhea pwpaeyn sy oour hh aa vpep etno: cr oe smpmo nudn i tcoa t ii ot ni sl i na lems oasrte tchuet , st raamn es pboerct aatui soen ll oi ngei ss tai crael lcyu, t a, eltocte ot ef r at h, es osyaomuehtahvien gt os think through, "How do I deal with those cut points in the supply chain?" (A0n0d:1in3v:2e7n)t:ory sometimes is the way that you deal with it. We have a client right now, they hr eaads oo nn :e idt 'iss tar i bb iuottieocnh c ceonmt epr ai nn yt,haenUdnpi taerdt So tf atthe es , wa nads t teh ceuy swt oamn teerds two egroe tcoh towo soi nf ogr stuhpi sp vl ieerrys winavse,ndtooryyo, uanhdavitesaitbs ainckaupphsyosuicraclepolfacinevceanllteodrya owranroeht?oTuhsea.t inventory is called contingency (00:13:54): Et yxpcee l loefn st .u Wp phoartt Tdroawc yn' st hs ae yliinnge . i sT ht hea tp oa itnBt oi es ,i nt gh,e t hweai rr eshuopupslei e rdso easr ea rdedq uv iarleude . t oI n hfaavcet , tthhies nf ouomt abgeer t ho fa t w' s aurne hd oe ru sreoso fairno uwnadr ethhoeu sweos ral dr o iusn di n ct hr eeaws i on rgl de xi sp ognr oewn tiinagl l yd, r aa mn da t ti chael l ys.qSuoa riet dt hoeeys nm' taby ost lheeerp ma el ittot l se ubgegtet se tr taot pnei og ph lt e, bt hu at tytohue yn se he do utlod ur enadde ras bt aonodk wo nh awt 'as r ge ho ionugs ionng . i Yn se iadhe, twhaorseeh foouusre wi sa lbl se .c aTuhsee otthhee rc orme aps loenx i ti ty' si si mg rpoowr tianngt at no du tnhdee rms taarngdi n wf ohra te' sr rgoor i ni sg doi nm ii nn issi hd ien ga very quickly.

In order to manage the risk of supply chain disruptions, Boeing requires many of its suppliers to have multiple warehouse stocking locations for contingency inventory. The good news is today, if you get a job in the warehouse, it could be a promotion. I almost fsealildo, u" Yt eoanhe, Id' vaey , bwe eenwperroemdoot iendg f tr ho em i nf i tnraondcuec it ni ot no st hl iek ew wa ree hd oi du seea, r" l ai enrd, aI al al md yo ss tt oj uosdt uf api nat ne dd rmi gi ghht t t' vhee rhea voen ht ha ne dsepdo ty. oBu e yc ao uu sr epiitn ku ssel idp toor byeo ui fr ygooul d gwo ta tac hj o: by oiun wt heer ewhaeraedh eodu soeu, tt ht he ye db aodo rn. eTwh se ids ui mf ypoi un gf oaurle au,py, eyaohu, r bcuatr ei te ri sc on uo tl dl ibkee ot hnatthaenlyi nmeo. rI te .uTs ehda tt' os tbhee sgoomo du cnhe ws l sa.c Tk hi ne ti th' se ns uo pt pt hl ya tc hwaai yn at hn aytmnoor em. aAtnt edr hwe rhea' ts yt oh ue rdei da sionnt: hi ef ywoaur egho obuascek, ittor tehael l y1 9d5i d0ns ', t 1m9 6a t0tse, rI. Bc aunt gmeat sys opur ot od ut hc tei osni x, tpi er so,dIu ccat ino'nt geef fti cyioe un ctyo. St hoe i ff i fytoi eus ,wt ha ne tmr ea ai nl l yt heefmf i cei ei nn t mpar ondu uf acctti ou nr i,nhgi gwhal ys up triol idzuecdt imo na cr hu innse. rTyh, i swwh aats , dyoo uy oc aun hhaavvee taon yd oc a? r Wy ohua tw' sa ny ot ua sr lsotnr ga taesg yi t ' si nb ltahcek -f a c t o r y ? L o n g

Warehousing Over Time

Logis�cs Center

Mfg. Assembly Fulfillment Center

Warehouse

Distribu�on Center

Value Added Services

S T O R A G E

Order Assembly

Value Added Services

Order Assembly

Storage

1960’s/1970’s/1980’s Mass Produc�on Mainframe Poor Quality Months Woolworths/ Mom & Pop’s

1990’s/2000’s Just in Time Personal Computers Sta�s�cal Process Control Weeks Malls/Wa-lMart

2000’s/2010’s Lean /SCM Internet Six Sigma Days Online Shopping

2010’s/2020’s Mass Customiza�on /3DM Mobile/Wireless Zero Tolerance Hours Omni Channel

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(Y0o0u:1c6an:0h1a):ve any car you want as long as it's black. And if we had computers, they were on am bo ingt hms .aSi no f raal lmt he .a tQwu aolri tkys, ttohgeerteh er er at lol yc rwe aa st en 'at lvoetr oy f mi nuvcehn. t oArnyda lneyatni mt iemseosmwe tehrien gq ui so tme da dien. So the main role for the warehouse was storage.

Early mainframe computers were literally the size of entire rooms. Then in the '70s and '80s, we got this idea called just-in-time, the Toyota Production Ss oy ms t ee mt i m. Te ht he ri se 'ws eae kw. hBoulte bianstiecrael lsyt ,i ni ng J satpoarny , tahr oe ul ongdi stthi cast . c Mo nadyibt ieo nI sc aa rne suhnairqeu et hcaotmwpiat rhe dy ot uo wS phaacte wceo nh satvrea ihnet sr e ai nn dt hne ast tuartaels . rWe shoautr ci se ucnoi nq suter aai bnot su. t St ho ,e tl oo g ios pt iec rs act eo n tdoi t i oe vnes ni n s Juarpvai vne? fni antaunrcai la rl leys, oyuoruc ehs atvhea tt wo emr ei nriemqiuzier etdh ea ni nd vyeonut 'ovrey gboet ct aouospe e trha at et iwn aayl i yt tol eu 'trien ymsipnai mc ei. z i n g t h e S t ( h 0 o a 0 t y : ' 1 o s 7 u w : ' 0 v h 5 e a ) t h : e haarpdp et hn ee de xwpi rt he sjsui os tn- i nn-etci me ses.i tAynids tthheenmI To twh eern to ff rionmv etnhtei omn . aTi nof raa ml aer gteo dt heeg rPeCe ,. Qwue ae lki tsy, ,a wn de tghoet i tdhei as wi daesa tchaal tl etdh es twa tai rs et ihc oa lu sper owc ae ss sg oc oi nngt rtool , gaonadwl ae ya n. I tri me me se mwbeerre sqeueoi nt eg dt hi ne at hr tei ccloevs eirn s mt oor yd ewr na s mt haitse rpiiacltsu rhea nodf lai negmopnt ye bi nu ipl dairnt gi c ua tl aHr ,a rt hl eayt Dt haev iwd saor ne h. To hu es ei mi spdl iec aadt i.oAn nodf cr eo aulrl sy eains et hmi sp tuys ewda troe hboeuas ew. aArnedh ot hu es ew. Iat rteuhronuesde onuetviet rwdai es da. nI te jmu sptt yc hf aa cntgoerdy.. AI tnwd atson a' t leavr egne dweagsr teaek, ei tn cuapmbeyt oo r ldi feer. aYsesse, mt hbel ryebwe caasu lsees st os gt oe rt at ghee sepc oa cneo mr eiqe us ior fe ds c, abl ue ti na ltl r tahnastp oo trht aetri os np awc ee

jquusat nt tailtki eesd aanbdo us ot ,r yt ionug' voeu tg toht otsoe bprri on dg ut chtoss, et hsamt taal lk oe sr duepr sa tl oo gt eotfhfel or osrosmpeapc el a. c e . P i c k i n g s m a l l (T0h0e:1w8a:1re5h):ouse didn't die, the storage area shrank, but then we added this area that has a lcoetn ot ef rp. eAonpdl et hi ne ni ti nc at lhl ee d' 9o0rsdaenr da s2s0e0m0bs l, ywaengdo wt thhai st iwd ae sa ac awl l ea dr elhe oa nu .s Oe kbaeyc,atmh aet 'al l dgies tt rmi beuot ino na sc oa na psbt aorxvien i af yhouur rgye, tl et oa no . lTe ahne .r eWai rt he ao nl oe t col ifegnot ,otdo i gdeeta st hien pl eoai nn t, bauc rt oysosu, Icfai nn abl ley t ho aodl et aonm. Yaokue uT ph earne 'asc rboanl aynmc e, l ut hdai ct ryoouus l ryeeanl laymnoereedd awt iat hn ya lswuapypsl ya ncdh anienv. eArn. y w a y , t h e w h o l e i d e a w a s a l l ianmv oe nu tnotr tyh ai st wb aed s. hSoouml de hi anvvee.nSt oo r wy ei s' l l ggoeot di,n taon dt h saot ma el i titnl ev elna tt oe rr .y Bius t bsaodm. eT ho ef rteh'es s ea irdi eg ahst hq ua va el i tbyr, owueg gh ot tl et hs si s i indveeanct ao lrl ye di nStiox St hi gemsau. pApnl yd ct hhaati 'ns. aAnnodt htehre sno IaTp bwoexnIt ctaon tgheet ionnt .e r n e t . A n d

Six sigma is not for everybody or every situation.

(S0ix0:S1ig9m:1a6)w: ill not land you on the moon. You need 50 sigma in terms of accuracy. Six Sigma mS i ga my ba e, wt ohoa tmi su tchhe t roi gehx tp leecvt eflr oo fma cac luortaoc fy wt haarte wh oeussheooupl de reaxt pi oenc st ?. SToh Ie agl owoady st htianl gk tahbaot u' st croi gmhet oa nu dt oyfoi ut , iwt ai sr ephuot uasleo ta ot fOqnuea lSi it gy mp ar e, sws hu ar et do ni d t ht heewcaursetho omuesre . eIxf pyeorui emn caen?u Of anc et uSr ieg amt aS. i xO kS ai gym, iaf you manufacture at Six Sigma and you warehouse at Six Sigma and your carriers are One

So if g mf oac uosr noeng atthi vi se si ingsmi dae, wt hh ea t fdaicdt ot hr iee sc,u sbt uo tm enro te x spoe r ime nucceh? Ni ne g taht iev ewsai gr emhao. uTshe e raen' sd a tlhoet tloracnatsipoonr.tation. And really what ultimately matters is what's going on at the customer (O0v0e:r20ti:m19e), :maybe there's a little less inventory. We still got all that order assembly to do, bp ur ot dt hu ec nt iwn eag ou tn ti hq ue see ftohrimn g, skci tatlel edd i vna lau ec eardt adiend ws earyv, i cl aebs ewl ehde ri en eav ecreyr tcaui ns t owma ey r, ws oarnt et sd t hi ne i ar ct he er traei'ns lwe sasy i, npvaecnktaogreyd, tihnear ec es hr toaui nl dwbaeyl.eAs sl l wo af rt ehha ot ut aski negs . "u Np os ,ptahceer, ea' sn dl e ws s es tt oh roauggeh st ,p"aWc ee, lbl ,ui tf we still got the order assembly and now we've got all the value-added services. (A0n0d:2t0h:e5n7)w: ho knows what the next decades will bring, but we've got some ideas about wo rhdaetr mkiignhdts hoafp paec nt i vtiht iaets m. Ta hy be e i nwtee'rl nl egte twt oo nm' t a es sv ecnu sbt oe mwi zi ar et ido. n Ymo uo 'rl el ha na vde mi to raenmy wa khee rteo, au ns uy tailml y e, ,t haen by pe tl at ecre ,a cwc he sast eyvoeur hyaovue twh ae ni tn, f oorkma ya ?t i oSno, , t hwee l ehsasvien vaecnc teosrsy tyoo ui n' rfeo rgmo iantgi otno. hAanv de c t b h a e a s c e t a d u in a s v e y e , t n b h u t e o t r r e a y ' n s . y A b w n e d a tt y t e . h r A e v n n i d s q i t b u h i a e l l i n i t t y y l . e , V a I n i g s u i t b i e m i s li s e t s y th w b e r i r l e e l e b j d u e s s i t n t r w h u o o s n t u ' r a t s n b . de iatntya keer sr oorus .t Iat ' sl oht aor fd tthoe i mj u as tg-iinne- (L0e0ss:2i1n:v4e3n)t:ory. We've still got the order assembly. We've still got the value added services, bwui tt ht owhheal pt ur es de du c teot hbee i nc avlel endt o ar yd, ni sot wr i bsuotmi oen ccoemn pt earn. i We s aasrtee bLl oe nc kd'isn ga tghoeoads seexma mb l py l ae r eo af at hnids wt hhe er er e' s tnhoe yd mi s teirngcet di o tnhne iorwd ibset rt wi beuet ni o tnhceefnatcetro rayc tai vnidt yt hwei tdhi sat rl oi bt uotfi ot hneci re na tsesre. mWbhl yy awc ot iuv li dt yy. oS ou dt hoe tyh' raet mb ya trhr iee dw awyi?t hI t 'ost ht heer ug lotoi md sa taenpdotsht pe yo ngeomoeuntt .t hAes ds oooonr . aTshtehree gaoroe dws oc or dms ef oo rf f tthhaet .l iWn ee, dc ei dn tae rp, rbouj et ct th eo nwe atri emheo uasned i si tn w' t agso icnagl l ea dw aa yl. oBgui st t iwc sh aptl'as t fgoorimn g. Iot nc ai nns ibdee ctahlol esde fao fuurl fwi l laml l se ni st now much more alive than it used to be.

(S0o0o:2n2e:t4h1in):g I want to ask you is, what's so different about managing what was inside those fwoaulrl sw? Wa l lhs aitn' s tdhief f e' 5r 0e ns ta? nWd h' 6a t0' ss pvhe yr ssui csa lwl yhda itf fiet rleonotk?sOlni keei sa nf odc uasl roena dtyh ei sc ui ns tsoi dmeetrh, oa ns ed ftohuart yd iief fledrse nat . sTe nh saet toafk eusr goeuntc ym. aTrhg ai nt ' sf oorn ee r. rVo er .r yWghoaot de. l sWe ?h aAtr ee l st he e ri se dmi fof er er e no rt ? l eVsiss i bpiel iotpy l ei ?s Pursoedbatbolybem? oMroerpee. ople and less physical goods. Is the space more or less broken up than it (N0o0w:2w3:e2'6ve):got all these pockets of activity that we got to figure out how to connect. There's lt eos sb emaa rggoi on df omr ae nr raogre, rt haenrde ' tsol ehsasvtei mg oe ot do gdeets ti ghne swnoorwk dt ho na ne . iSt ouiste' sd atcot ubael l. yI nmfoarcet , i mt o pd oa ryt ai tn' st as tbusdoyl uwt ealryechroi tuiscianl .gS, tootrheaatd's uapn ootnhietr, troegaesot nv eIr hy agvoeondoatqiut .al m s abo u t en c o u r ag i ng p eo pl e t o (T0h0e:2o3t:h5e4r):thing I want you to notice is the evolution of the names. We went from a wc l iaerneth oi nu s eU ttaoha, dI ' il sl t rniebvuet ri o nf o cr eg ne tt e ri t, toona tl ho igsi s tpi ac sr t ci ceunltaerr , dt aoya, ftuhlef i l dl ma ye ntthceeyn treern. aWmee dh a dt h ae wt haorueghhotu isfe ytohue wl oagni st t ti cos gceetnpt er ro, mt ho tee df a, cyi loi tuy' r em ha na va gi negr aw ahsa rpdr ot immoet egde t tt oi n gv i cper opmr oe st ei dde, nj ut . s It rwehneatmh eer t ht hea tb uwi ladsi ncgo.i nMc ai dyebnec es oomr ent ho itn, gI dg oo no 'dt wk ni lol wh,abpupte ni t tios ya orue. f lIe cdtoi onn' t okfn ot hwe. sBt ua kt ensoowf wsuhpaptl'ys cghoainingmoinssiinosnidcerittihcoals.e four walls. It used to it didn't matter so much. Today it's

Warehouses come with a variety of names and roles in the supply chain.

( T 0 h 0 r : o 2 u 4 g :3 h 9 ou ): t this course, you're going to see lots of different sources of information. Where I cbaene,nI'mdoginogingthtios bsriinncge b1e9n8ch8m. Yaorkus,cdaantathfrionmk aobuoruwt arehouse benchmarking survey. We've the average cost to sales ratio of warehousing is somewhere around 3%. US warehousing, 3.5% in this particular survey. There's a lot of money tied up in warehouse and it's very visible. (S0o0m:2e5o:0f7o)u: r biggest supply chain projects started when somebody got upset with how mD ius nc he yms ot anret ye dwwa sh ebne itnhge i sr poeuntts iodne wa awr ea hr eohuos ui nsge . s Ap alcoet wo fa st hger owwoi nr kg . tShuadt dwe ne 'l vy ei tdboencea mwei t ha bwi ag r ebhuodugseet mi t eomr e. Ae fnf idc i eo nf tc?o" uAr ns ed, ut hs eu acl al yl l, tt hh ea t a un ss uwael lry i sc opmr oebs aibnl yi sy, o"uH os wh o udlod nI ' tmhaakvee tthhi es wr oaortechaouussee, iat t' l la tl la. kWe hy oa tu ias lcorne ga twi nagy tdhoe wnne et dh ef or ro at dh .e Wwea' rl legheotums eo?r eA ni ndt oi f tyhoaut acsa nw eg egtot oa l ot hnagt. t u B h p u r t e i o n e n a w e n a t d h r e a in h h g o a u I l s f d i p o n e g w r c t a h e n n a t n t y o o p f u e s o t a o p l e l u e s n i r d s e e a 3 r l 5 s ly t a m u n i n d ll d i i o s e n r t s h a t a a y t n e l d e a , t r ' a . s n O s d f a t y e t n h y t a o i t u m l g e e o s a t d t a h s e b u r i s e ll i t i o s o n m t - h d o o e r l e l p a l m r ig c o h o n t m e o y p f a t t i n warehouse manager.

y d e ,

h e

(N0o0w:2,5th:5is8)w: ill be maybe the most depressing part of the course, so just hang with me here imn ajnu as gt ea ws eacr.eThhoiussiess ,t raynidn gi t tgoope as ilni kt ea tphiicst. uFri er sot fotfhael l e, inf vyior oun' rme eanwt at hr eaht owues ewmo rakn ai ng etrr,yyi no ug ’ rt oe pt hr eo bwa abyl y? aS smk ae ldl etro l oh ta ns idzlee, ms mo rael l et rr aonrsdaecrt si o, nt rsyti hn ag nt oy ogue te vt hear t ui snevde nt ot ohr ya nddol ew. nW. Lh eyains jtuhsatt- ibny- tt ihmr oeu, gTho yt hoet awparroe dh uo cutsi eo ni n s tyesrtme ms , o wf phiaetceevse, rb uyto ui t jwu satn gt oteos ct ah lrl o iut g. hT hi ne ssma ma l lee rv oi nl uc rme em egno tess. Nh ooww ,bei ag ciht iosf. tShootsheei nmcor er emterna tnss ca ac ltlieodn sa ny oour ddeor, ht haes ma foi xr ee dwaomr ko ub nu tr do ef nwyoor uk ' wr ei tphuittt innog mo na ttthe er warehouse. We call that work content.

The Plight of the Warehouse Manager

Under the influence of e- commerce , supply chain collabora�on , globaliza�on , quick response, and just -in- �me , warehouses today are being asked to (1) execute more , smallertransac�ons , (2) handle and store more items (3) provide more product and service customiza�on , (4) offer more value -added services , (5) process more returns, (6) serve more channels, (7) process a greater variety of order types, (8) receive and ship more interna�onal orders, and (9) provide higher levels of safety and security for people and property. At the same�me warehouses today have (1) less �me to process an order, (2) less margin for error, (3) less young, skilled ,English speaking personnel, (4) under- developed systems capability,and (5) re�cence to automate despite all the publicity surrounding warehouse automa�on . I call this rock and a hard place scenario the plight of the warehouse manager . Never has the warehouse been asked to do so much andat the same�me been so strapped for resources at the same�me .

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RightChain™ Incorporated

The Toyota Production System and its JIT and Lean predecessors operate under the philosophy of small batches and small orders; putting a heavy workload on the warehouses required to support them.

(N0u0m:2b6e:r56)tw: o, there's more consolidation and assembly. Why? That's to get the tursaends pt oo rbt ea .t iWo nh ye ?c oSnoommei eosf ti th' as tc wu set oj ums it ztaatlikoend, saobmo ue t o. Tf hi t i' rs dmi sa rt kh ee tyi 'nr ge cmr oe ar et i vSiKt yU, ss ot hma en ot hf ei tr' es dh ea mv ea an dc .l iSe onmt rei gohf t i tn oi swwaen di ntthr oe di ruScKe dU ab anseewo voenre ,t hbeu tl aws te f enwe v ye er agros t hrai sd gorfotwh en of rl odmo n2e0. 0Wt oe 4h 0a v0e. , Wi t h' se 2n 0w0 .e S' voe trhueny tcha en ignevtetnhteo rsya mmeo ds aell es s t of r of img u2r e0 0o uS tK Ue xsatcht layt ht hoewy cmaannfyr ot mh e y4 0s0h.oAurl de you with me? So what should they do? (T0h0a:t2's7:S5K7U): rationalization. We ought to cut that SKU base back because a SKU sounds imn sa ingangi ef i ci ta, npt ,a rc ikgahgt e? Ti t h, eh roel 'ds ian lvoetnot fo wr yo frokr t iht a, ta nc odmi te so cwc ui t ph i eo sn ea tS lKeUa s. tS oo mn ee bl oocdayt i ho ans i tnos ipdl ea nt hi te, wv earrseuhso2u0s 0e . STKhUi nsk, baubto ut ht ewy hi na ts itshteotnu rsnt adyiifnf egr we ni tt hi a lt hweo4u0l d0 bSeKoUns . t hF iensaal lmy ,eosnael eds aoyns4o0m0eSbKo Ud ys

st ha ei di r sboomn eutshiisn bg atsoe dh eolnp. Hmoewu mn daenrys tnaenwd Si tK. U" Gs ut he es ys chaonwi nmt raordkue ct ien?g" Ii ts' si nc rc ae znyt e, rdi.g Gh tu?e s s w h a t

The proliferation of SKUs in nearly every industry poses a great challenge to warehouse and inventory managers alike as each new SKU dilutes demand and magnifies supply chain and warehousing complexity.

(A0t0h:2o8m:5e,1w):e have a program now. This is our industrial engineering in the home, okay? If yg oo ut tgoot ho eu tl iannedr ebvuiye wa snaenwd stwh eeiart ebri g, yroeut ahi lasvpeatcoe .gIifvyeoau swwaenatteedr tt oo itnhter oc hd uu rc ceha. An et wD iSs Kn eUy, ,ywo ue hmaadntaogisnagy,w"aHreerheo'sutshees.one it's going to replace." So, this SKU management is a huge deal in (Y0e0s:,29si:r1?4)G: reat question. Whose responsibility is assortment? Oftentimes it falls to me veerrcyhbaonddyi'ssi nr ge s pa no dn s irbeitlai ti yl . eBnuvti roof nt emn teinmt .e sT iht afta' sl l swi nh emr ee r tchheayn'dl li ssi anyg oi tr bs aelleosn ag ns .d Tmo a rmk ee,t i int g' s. Twhi tehs es oa mr eev pe rr yo ccersesa tdi vi sec ippel ionpel .e T. Nh ao tt 'hs i nwghwy ryoonug nwe iet dh ca r Se Ka tUi v irtayt. i oI tnna el iezda st i ot on bper ohgerl da mi n sci ht tei nc kg there right beside the new SKU programs.

(Y0e0s:,2s9ir:?54Ja)s:on brought up a good point there. What do you do with replacement parts? Like Hi t 'ol lnmd aa, kwe ey' ov eu rdho enaed as pl oi tn .oAf nwdo irtki swriet ha l lHy own do ar k, itnhge,yb' ruet itnhter roed' su cl oi nt gs onfe wp a rctasr tmh aotdceol smseo wf ai tsht tgheat tg. oTohde raet' smaalneaggi tiinmg aitte. Sboums i en eosfs i nt ej uesdt tcoohmaevse wa lilt ht htohsee tneerwr i tpoarryt. sB, aunt di f syooyuocua jnu srte dh ua vc ee ti to, you'd like to reduce it.

Warehouse Op�miza�on In technical terms , op�miza�on is an approachto decision making or problem solving that frames the issue at hand with an objec�ve func�on and constraints. In warehousing, the objec�ve is to minimize total warehousing costs. The constraintsare the service , throughput, storage, safety, and security requirements . Total warehousing costs include the cost of labor, occupancy, material handling systems , and informa�on handling systems . Service requirements (constraints)include inventory and shipping accuracy as well as inbound and outbound cycle �mes . Throughput requirements include peak and average inbound and outbound transac�on rates at the docks and throughout the facility. Storage requirements , peak and average , are dictated by the inventory strategy and associated inventory peaks and valleys . Safety and security requirements are corporate mandates . RightChain™ Warehousing considers the full range of warehousing costs and constraintsin cra�ing op�mal warehouse designs.

Honda Parts DC Atlanta, Georgia

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RightChain™ Incorporated

Honda parts warehousing has become especially challenging with the proliferation of new part types to support waves of new Honda car models.

(R0o0b:e3r0t:2[i7n)a:udible 00:30:28]. And that's around kitting. Sometimes what you do there is you at hr eo upgrho. l iSfoemr aet itni mg eSsKkUi st i nbge ci as uas ge otohde ikdiet ai sa nadSsKoUm. eI tt 'ismneos tkti ht ' as tnkoitt ai sg on oe cdeisdseaar.i lIyt da obeasda di dde aa St hKeUp, lsuos tshi adte' si no nk ittht ien gc ?o nT ismi dee. Bo ef ct ahue sperwo sh ea nn dt hceo no sr dtehra tc oymo ue sd oi n i, nt hae rkei t' si nngoaansasl eyms i sb. l yWwh oa tr'ks tohradterhsacsatnoyboeu dreoanlely. Tfohreecparsot btolekmnoiswytohuathaakviet wtoiltl rsyattiosfyfigthuerme .out what portion of those

Kitting is a warehouse akin to order picking in which several parts are packaged together for delivery as one package or “kit” – typically to an assembly line.

(T0h0e:3k1i:t1in5g): is a gamble. Right. The other thing that we have to do now is more ci duesat o. mY oi zua thi oanv .eT thoa tf' isg mu roer et hi na tt ootuhte. mB uatr ktehtei nfga cs tc hi es mt he .e Ar en' sd tmh oi sr em adye mo ra nmda yf onro tt hbi es ai ng ot oh de ms oamr ke et itmp leasc ey otuh ahna vi et tuos eddi f fteor ebnet i. a It fe yyoouu r sc ea lnf ' tw di tihf f et rheen tpi aa ct ek ayg oi nugr soerl f t hwei t hc r etahtei o np r oo fd ut hc te, oc or dmeer . wTiht ha tt' sh atth. eA cluost t oo fmtihziast iiosnt rpyiiencge .t oA nddi f f tehr ee nn t itahteer ey'osumr soe rl fe i nv atlhuee ma dadr ke de t ps learcvei .c eOsn ct he aat cdeifrfteariennptiraoteduthctembesceolvmeess. a commodity, these are the places where marketing has to go to A l ( i 0 b n 0 e d : r 3 a t 1 h l : r e 5 e n 5 t u ) t : h r nesrep'solimcioerse. Trheatut'rsncsorthreacnt.there used to be. Why is that? One is there's more

(O0n0e:3is2:t0h3e)r:e's more liberal returns policies, that's correct, and if you order something over tahbeleintotetronuecth, wit,hfiecehl iyto, kui'crek imt, osrmeellilkiet,lyettocedteorath. an you used to, you probably haven't been (M0y0:w32if:e1t5h)e: other day messed up her ACL and her MCL, so we're hobbling a little bit at the hNoouws ,eh, oa nwddsoo ysohue schooupl df on r' t sghoo es hs oopnpl iinneg?, bY ue at hs ,hoer wd earn tt we di c seo, ma s emnaenwy sahs oyeosu. Sr he ae l lgyo ne se eodn, l ai nned. then you send the others back. There is a ton of that going on out there in the industry. (A0r0e:3y2o:u47d)e:pressed yet? Okay. We're not done yet. Hold on. Next is international orders. Te vheerr eu' ss eadmtuoc hb eg raena tde rt hl iekreel 'ish oao dmtuhcaht wg rheaat t eyro ul i skhe il pi h oi so dg o itnhga nt o wahnaott'hs e rc ocmo ui nngt r yi ntthoa nt hiet wd eaarleahboouuste ains ci notme ri nnga tfiroonma l aonrodtehre?rMc oo ur en trreyg ut hl aatni oint se.vTehr auts' se dr i gt oh tb. e . S o w h a t ? W h a t ' s t h e b i g

International orders, inbound and outbound, have much more physical and documentary work associated with them than do domestic orders.

(O0n0e:3t3im:1e4)I:went and counted how many potential regulations there could be, how many ds toocpupme de nctos ucno tui nl dg .t hTehree obteh teor st uh pi npgo ri st , aonnotuhteb oi nubnoduinndt e sr indaet,i ot hn ea rl eo' rs dseor , ma nu dc hI gc oo nt ct oe r4n3 aabnodu It twhhea ttsroaenvsepro, rst aot iiot nt a ckoess t sp. r oTbhaeb l cyotnwt aoi nteor st h ar er ee tsi mt uec sk . a sT hl oe nr eg' st on po r oocregsasn iazna tiino tne rinna tti oh ne ma l order as it does a domestic order. (N0e0x:t3i3s:4ex9p):osure. If there's less inventory, now there's more focus on what's going on in the wt oabr ee h. To uh saet '. sYao uh ecaavny' t bmu ar kd ee na rmi gi hs tt atkhee, raen, ds ot hi fe ryeo' su mw oe rr ee ns'et cduerpi trye sc soendc esron sf atrh, ayno ut hme ri eg huts be de hn eorwe yi no uj ugsot taa sdeac yo.nIdf . yTohuehr ea'ds al eds sa yt,i mn oewt oy og ue t gtohte aws ohri fkt . dI fo ny oe .uI fh aydo ua us hs ei fdt , tnoohwa vyeo ua gwoet eakn, hi novuern. t oI tr' sy . jJuusstt dt iemf ea c tcoo, mt hperrees'ssi ol ens. s Sme ca or gnidn fios r tehrerroer' .s T lheesrse 'ms laersgsi ny ofuonr g esrkriol lre. dTl ha be roer' st o l eg sest the work done. (W0e0:h3a4v:3e2a):client right now. They're going into Eastern Europe to train warehouse workers af inndd tthheenpberoipnlge twh ei tmh ttho et hs ke i lUl sn, i wt e idt hS ttahtee se nt oe rwg yo rtkh ai tn tthheeyi r wwaanrte wh ohuesree bt he ce ay u' rsee l tohceayt ecda. nI 'nt Jwa pa raenh, otuhsee sa gi si nagn oi nf dtuhset rwy ,ohr ok wf o rbcieg ti sh es us icghn sa abr ei g, hdoewa l btrhi ga ht tntohwe l it ghhe t ss eanr ei o, rhi oz awt i ho ne a vo yf tt hh ee py oa cuk. aWg ees' l al rlee, t e ty oc eut egreat, eatwc ae yt e rwa i. tThh ea nn yOt hS Hi nAg , "i s annodt i nt htehne raensoatyhienrg , w" We i redr eoanl ley fi es e ll essosr rWy Mf oSr capability, and this is starting to turn here a little bit. (D0o0e:s35a:n2y2b)o: dy know what system are most warehouses operated with? Anybody know? EE RR PP ' ss yws teeamk es sat rlei nrku nonr i nwgh ma t oisst awna Er eRhPo us ys es st e, mi f 'tsh we ye' ar ek ersut nl ibnyk ?a Ist y' ss tuesmu aal ltyail nl . Wt h he elroeg iisst iacns as traerat. e dM, oa sntd oa f l ot th oo sf et h se ys se t seyms st e mw se rwe e nmt ai nn uaf raoc ut unrdi nYg2 Ks y, ss ot eamt sa toi mr ef i nwahnecni awl es ynset eedmtsh et om og es tt cwahpya bcial int yI, no fotte ng toi mp el asy wgeo lhf al vi kee t hI eu sl ee ads tt .o I, f wyho yu de vo eers wt hoi sn dweor er kd fwe ehly saoms tIr ewsos rf ukli,ntgh si so ihs atrhde, rtheaast'osngoriignhgtohneirnes.idTehatht'es wjuasrtewhohuastei.t is. If you have to sit back and try to put words to it,

ERP systems are running more warehouses than any other type of system. Though improving, unfortunately, ERP functionality for warehousing and logistics is severely limited and limiting.

(N0o0w:3,6w:2h0a)t:do you do about it? So what? The best "so what" I can give you is it's usually not anbuomubt etrh eo ns ey,s tthe me n. Rp eaor epllye ,i st htehne ps yr os tceems s .t hWeer' reea lgpori nogb lteoms.pUe snudaal l yl o, ti togf ot iems el i ki ne ht heirse. Mf i resttr iocfsailsl fsihgouur il nd gt hoeu twwo rhka tbsehdoounl de , yaonud mt heeans uwr eh, atth oe nr gwa nhi oz awt i oi lnl ds oh otuhled pbreo cpeusts i anf tpelra cme ettor i cd?o Ht hoawt work? (W0e0':r3e6g:5o4in):g to talk a lot about simplification in here. How do you just take workload out of twhee' rwe agroei hn og ut soehcaovme pa sl ewt eel yg, oi nt hc lruodui gnhg . nOof tte hn at ivmi negs , tpheeowp laer ae rheo suos eb ua ts ya lf li ?g hTthi na gt ' st hteh ef i rme si n, tdhseeyt fpol ragc ee t. Itth' sa te at shye rt eo' sg eat wi nat oy ttho adt ef isriegfni gthhtei nsgyms t oe md e ,saon tdh wa t et' rhee gf oi rien gn et ov et ra l hk ai pn pheenrse ian l ot ht ea bf iorus tt how do you prevent the fire in the first place.

(N0o0w:3, 7to:2d5o): that, we're going to start with logistics as a whole. After we finish this, for the mo uorsct l pi eanrtts, wg eet' ri ne gt rooi un bg l et oi sb tehbeuy rmi eidg hi nt shiadveet shooms ee froeuarl l wy ga ol l os ,dbiudte aosn ei nos ifdteh et hwo saey sf oIu' vrewsaelel sn, bmuatn tahgeeyr s mwahyo bgee t tpo r ot hmeo theadr ma l oonfg stohme el i noet haer er ua sr euaa l liyn t thheeo snueps pwl yh oc,hyaei na h. , Tt hh ee yw' r ea rdeohionugs ae gwoi ot hd cjuo sbt oi nms ei dr es et hr vei cf eo ,uwr iwt ha li lnsv, ebnutto trhy e, yw' ri teh hperlopci nu gr eimn et nh te, wo tiht he rt raarnesaps oor ft atthi oe ns, uapnpdl yt hcehya' ri ne sensitive to what's going on in those areas.

The Role of Warehousing in Supply Chain Logis�cs

When the total cost of raw materials and key components is a major por�on of the total supply chaincost, when the unit costs of those materials are low, when overall demand is high, when significant discounts are offered for large procurement lots, when there is low likelihood of obsolescence, and when inventory carrying rates are low, large procurement buys with associated large lot size inventory levels may be well jus�fied . That inventory must be housed somewhere , and that somewhere is a warehouse, some�mes calleda raw materials warehouse.

RightChain™ Incorporated

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(Y0o0u:3w8a:1n5t )to: make sure as we try to put these good concepts inside the four walls that we're ns toatn dd obi na gc ks of rmo me t htihneg wt oa rheahromu st eh ea ns ud ptpr lyy tcoh faiignu, rseo of uo tr wj uhs at ta rfoelwe imt ' si nruetaelsl y, wp el a' ryei nggo ii nn gt ht oe supply chain as a whole. If you get a hold of this, it'll be worth your trip to Atlanta.

First Things First! King Solomon was the wisest man of all �me , the greatest of all the kings of the earth; and in real, �me - normalized dollars,he was the wealthiest man who ever lived . He was also a great builder, famous for the construc�on of Solomon ’s temple , one of the world’s iconic structures. In reading some of Solomon ’s books , I came acrossa key principlefor buildingthat is profound wisdom for warehousing. Applied to building warehouses, the principle is to first determine the business and supply chain requirements for the warehouse, then build it. Many enterprises have it backwards , so focused on the physicalstructure, their businesses wind up being constrained by their infrastructure instead of being bolstered by it. Our RightChain™ Methodology and op�miza�on systems are designed to help our client customers iden�fy the business and supplychain requirements their warehouses are meant to serve . “ Develop your business first before buildingyour house.” - Solomon

Coca- Cola Logistics Campus Raleigh, North Carolina

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RightChain™ Incorporated

(I0a0lw:3a8y:3s6s)t:art with the definition of logistics because, in logistics, the rate of success for ps ur oc cj eecstssf ui sl vi se?r yI t 'lso wa b. oAunty 3b 0o d%y, wb ua tn ti f t ot hgeupersos j we cht aitntvhoel vperso sboafbt iwl i at yr eo, f i ta gl oogeiss ttioc s1p5r%o j. eYc ot ub esianyg, "r We a hs oy ni ss ti hs ee dr autcea ot ifo snu. cWc ehsast spoelrocwe n? "t Ao fn tyhbeo dp ye owpal en twt ho og uweos rs ko inn t lhoagti sotni ces? dOon ey oouf tthhei nbki ghgaevset fkoi nr md . aTl ht ar at 'isn wi nhg yi ni n l 1o 9g i9s1t i cI ss?t aAr bt eodu tw 1h 0a %t w. aTshtaht ewn ot hu el dL ob ge i sat idc se gI rneset i tourt ea. Icte' sr tni foi cwa tteh eo Sf us po pml ye Chain and Logistics Institute. (T0h0e:3o9t:h3e4r):thing that I see is that there's very little definition around the project and, if tnhoet r tea' sl k ni nogt aa bn oy udt eSf icnoipt ieo nt h, ey omuoguet th wi n at os hw. Wh aht 'ast cyaol lue' dr e s dc oe ps cer icbr ee de pi s. Wv ehrayt 'gs osocdo. pYeo cur' er ee pd?o Ii 'nmg sbteu rf fe at hl layt hyaorud nt oe vme ra ki net epnr od ge rde tsos . dI of .yIof uy od uo nd' to nh 'at vheaav ed eaf idnei ft ii no int i toon f taol l gboa cbka cokn taon, di t 'tshgeor ei n' sg nt oo edde uf i cnai ttiioonn at on dl etahne no nt r, yi tt' so gbouiinl dg ftroo mb e t hhearred. Itno fma catk, ey opur ocgarne sasl. mWo set atlhwi naky so fs ttahrits wa si t ht h ae foundation for what's the Supply Chain and Logistics Institute. It's based on this definition.

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