According to Sherman, in order to avoid the strategic faux pas described earlier, and to account for a firm’s strategic personality, a pre-planning stage must be added to the strategic management process in order to create a baseline of the firm, a strategic profile or inventory. The strategic profile of the firm center the firm’s strategy formulation processes by placing realistic delimiters on the strategies that are developed from analysis. Matching the firm’s profile with the available strategic options creates a better strategic fit. The strategic profile consists of the strategic personality, the firm’s structure, leadership, and organizational culture. The remainder of this article will be a step-by-step guide that will help firms construct a profile including forms and then provide recommendations for how to use the profile for guiding strategy development and implementation. That is the initiative to make the warehouse activities well-oiled with identify root causes. In the other hand, this profiling activity is to improvements all the process in warehouse and lastly for provide decision making.
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There have two main categories in warehouse profiling activities such as customer order profiles and item activities profiles. First is a customer order profile. According Cooper and Mulaik, customer order profiles represent the outbound activity. That means it is an outbound activity that would deal with behavior of customer orders and fill up their orders. In the other word, this activity indicates the ordering patterns and ordering products of customer orders. There are four types of customer order profiles including order mix distribution, order increment distribution, order lines distribution, lines and cube per order distribution.
The item activity profile is used primarily to slot the warehouse, to decide for each item. First is what storage mode the item should be assigned to, second is how much space the item should be allocated in the storage mode, and lastly, where in the storage mode the item should be located (Frazelle, 2002). That means customer order profiles is represent the outbound activities, while in the item activity profiles is represent in house behavior of the items in the warehouse. This profile activity is preparation storage mode that could be used to locate the goods, the space needed to every item and the suitable place in the warehouse that should be located the entire item based on the types of item whether there are the small parts, medium parts, bulk, expensive parts or auto parts. The item activity profiles involving popularity distribution, cube- movement or volume distribution, popularity-volume distribution, order completion distribution, demand correlation distribution and demand variability distribution (Frazelle, 2002).
In the context of warehouse efficiency, the detailed analysis can give an idea and providing opportunity of how to prepare the future needs in warehouse operation such as receiving, putaway, storage, picking, packing, sortation, and shipping activities. These activities also can be a great help in understanding warehouse operations otherwise improved the productivity and conducting cost.
RECEIVING
After analyses of customer and items activities in the warehouse profiling are done, next is receiving in warehouse operation. Receiving activities in the warehouse can be considered as physically accepting material into warehouse, unloading the material it from the inbound transportation mode. Activities also include verifying the quantity and the condition of the material, and documenting this information as required, and arrange or ensconce the material to storage or to organizational function requiring them. We must be careful when receiving material or merchandise because if we didn’t do properly it will become difficult to handle in other step in warehouse function.
The best receiving is no receiving. For activities receiving there are few steps to make the process of receiving become better and better. If we appoint this few step it will helping us in minimizing work content, mistake, time, and accident in logistics. So, we have to pay attention and more seriously when practices it. The 1st type is direct shipping. Direct shipping mean the material come into the warehouse then direct shipping to the customer. Direct shipping no need to pick location, picked, packed and loaded. Consequently, the labor, time, equipment, mistake and accident often occur in the warehouse are eliminated.
The 2nd type in receiving activities is Cross-docking .Cross-docking will be used when some material cannot doing by shipped direct. The few process in cross-docking is the merchandise is plan to send to the warehouse from vendors, Inbound is sorted into their order, outbound order are send to their outbound dock, no need to checking and no need to storage the product. In the other hand ,the other function of warehouse like receiving staging, putaway, storage, pick location replenishment and order assemble are no need .
The 3rd type in receiving activities is receiving scheduling. Receiving scheduling need ability to set inbound materials to match coordinate outbound requirement on a daily or even hourly basis. Capacity are need to schedule carrier and shift time consuming receipts to off-peak hours and make sure equilibrium receiving resource.
The 4th type in receiving activities is prereceiving the most time and space intensive activity in receiving function is receiving dock, because that time need hold material for location assignment, product identification.
The Final type in receiving activities is receipt preparation. When a product has been receiving we have to plans for the time to shipment. This is because when the product has order by customer that just has little time for additional preparation of the product period to shipment. Any Material that should be accomplished ahead of time should be accomplished. Those Preparatory activities include Prepackaging in issue increments, Applying necessary labels and tags and Cubing and Weighing for storage and transport planning.
The content in receiving has been show that receiving is important function in warehouse activities. That is because activities receiving in warehouse are receiving all the material and order from outside or other company. We need to pay all attention when the activities receiving is holding make sure the quantity and quality of material or goods is suit and accurate with ordered. In receiving activities, it’s including upgrade the system look out the way to improve the system operation. Receiving activities also need to check and clear the receipts that have been receipt and make sure the receipt are not any error. Activities receiving not only important for the warehouse only, but if we practice it well, it will improving the productivity and efficiency of warehouse.
INVENTORY AUDIT
Inventory audit is one of activities in warehouse activities. Audit in warehouse have been use to evaluate changes in warehouse and completed in March 1996. Major change in since previously Activities inventory audit normally will handle by an auditor’s. Major change in since previously was the implementation of the inventory module of the new oracle finance system. There got few objective in inventory audit, That is material has receiving need to check properly and records it immediately. Make sure all the inventory complete and prefect. Warehouses were in acceptable condition and properly procured or returned to stock. No goods were removed from stock without proper authorization. When needed, goods are moved from the warehouse to production; perpetual inventory and cost accounting records are updated. Goods in stock were maintained at a cost effective level necessary to support City operations. Excess inventory levels were timely noted and adjusted in accordance with City policy. Goods stored at the warehouse were secured and protected from damage or Misappropriation. The environmental conditions and work practices at the Warehouse Complied with applicable safety standards.
>>>>>>>>>>>>>>>>>>>WAREHOUSE>>>>Production department >>>>>>>>>>>>>
The good and material and from receiving to the warehouse, goods are moved from receiving to a warehouse; perpetual inventory is updated, When needed, goods are moved from the warehouse to production; perpetual inventory and cost accounting records are updated, When finished, goods are moved from production to the warehouse; perpetual inventory and cost accounting records are updated for the second time, finally When sold, goods are shipped and perpetual inventory records are updated again.
The auditor need to concern that the inventory plan has statistical validity, properly applied and achieves applied, and achieves reasonable results. Auditor also need always review customer procedure for investigating and evaluating the warehouse. Besides that the auditor still need observe the physical inventory count, and the quality and condition of the inventory. Auditor need selected a sample of inventory items from the customer count records and if a consignee holds a portion of the customer’s inventory, auditor also need confirm that amount with consignee. Finally auditor need consider the effect of sales and purchases that cut off on inventories and test the cost accumulation process that affect valuation of ending inventories.
The Content in Inventory audit have been show that Inventory audit is a finance system quiet important in the warehouse function. When the stock or goods in receiving process, the stock will store in the storage based on their type and variety .In this case, inventory audit are need to check the record or count the stock properly. Inventory audit need to count how many cost and expenses of this stock and good, what stock is gain profit and available to sell in future, and what stock is loss or deficit. The auditor needs to pay attention when record and count the stock to avoid company from getting deficit. We have to make sure no any goods and stock are removed from the warehouse with any proper authorization. When the good and stock are removed from the warehousing to production perpetual inventory and cost accounting records are need to record immediately. Inventory audit are important for a company, we need it to help us record our activity, if we practice it well, it can help the company to gain profit and make the process of company become more efficiency.
PUTAWAY
Putaway is order picking in reverse. Many of the principles that streamline the picking process work well for putaway. In order, the world-class principles for putaway are
Direct putaway
Directed putaway
Batched and sequenced putaway
Interleaving
(Frazelle, 2002).
The statement about explain the definition of putaway and the system that they use in putaway operation. Put away is the process of taking the product from the receiving area to put it into the most appropriate location. These processes follow the sequent from the first which is the receiving step and come the put away system. There are different kinds of put away system such as direct put away, directed put away, batch and sequence put away and interleaving. According to (Frazelle, 2002), goods that been transfer to warehouse from receiving point is best to directly ship to the shipping area without including a lot of operation in warehouse. But that not near possible to all goods that been transfer to the warehouse.
The first kind of this system is direct put away. Goods from receiving area are transfer direct to storage area without much of inspection and staging activities included. These types of goods can be for special goods zone. When using this method, they can prevent delay and multi handlings that always in the put away activities, but not all parts can be done with this kind of system. These special goods like expensive parts have to carefully taking care of and some time immediately transfer it in the special or normal storage. Therefore they have to reduce the unnecessary activities to prevent from damaging the goods.
Another kind of put away system is the directed put away. Directed put away system work like giving near supplier to the production area. Parts are send to the designated area that easy and near the production area means that part are no longer in the store. The reason to put this way is that the parts are big and use a lot of energy to transfer from store to production area. Another things is the part are always been use in producing product and that require times to take the parts from the store if they didn’t use this kind of method. With this, production people have to take the responsibility to make sure the parts in goods shape when it’s outside the storage area.
The third kind of this system is the batched and sequenced put away system. These techniques use the storage area fully. Each part from receiving point are categories before entering the store. Then the warehouse personnel sort each part according the label or category that include in the store. They can divide the storage by zone to make it easier to sort and find the part like zone 1 for small and medium part, zone 2 for expensive part and so on. That way they can aim to sort inbound material for effective put away.
For the interleaving system, it requires the combination of putaways and retrievals process in a dual command. That mean personnel in putaway area have to move continuously from the picking area to the shipping area. Interleaving is similar to backhauling in transportation. (Frazelle, 2002).
In the context of warehouse efficiency, put away can reduce the time need for the storage personnel to do their job. It is because in the process of put away, goods are been divide according to the three kind of system (Frazelle, 2002) before store it in the storage. Not all goods need to be store in the same place like the expensive goods in the hand phone such as camera, LCD and many more. These goods need to be taken carefully and with the help of put away personnel the goods can be store directly from the receiving area. Some goods didn’t have to go into the storage like the big part or the part that always been use in the production floor. That way production personnel also can safe time from the placing of parts near them.
STORAGE
After the put away activities finished, the receiving materials will be stored in the storage area. Warehouse storage is the main core and plays an important role in keeping all the materials which are included raw materials, work in progress and final products that belong to the organization. There are several types of storage inside the warehouse.
First of all, we can commonly see the pallet racks in the warehouse. This kind of storage method was specially designed to fulfill the maximization of product that placed on the pallet. Every standard size of pallet was set to store inside the storage rack using forklift or stacker.
Next, the open floor storage which is useful for bulky products that usually occupied the space. For example, the large size material used to be placed beside the operation part because it makes the operator more convenience to take the materials. Besides that, storage of these bulky products would be easily counted by quantity and volume.
Furthermore, containers are used to store temporary goods which are ready to be shipped by the transportation. Normally we can see the containers are sealed in the truck, ships, railcars and planes. Automatic Storage and Retrieval System (ASRS) is defined by the AS/RS product section of the Material Handling Institute as a storage system that uses fixed-path storage and retrieval(S/R) machines running on one or more rails between fixed arrays of storage racks (Edward, 2002).
In the context of warehouse efficiency, space utilization is the main key of storage policies. Warehouse is not helping company to earn any money. To minimize the cost created by warehouse, space is utilized by storing as much as the warehouse afford. The criteria need to be considered is the size of the materials to be store. Normally, the materials are store regarding to their size. There are several sizes of the materials such as small, medium parts and bulky products.
Besides that, warehouse personnel can implement zoning strategies inside the storage zone. This is a way to recognize different types of materials that been stored inside which zone. Arrangement of the materials will be tidier and more systematic. By using Warehouse Management System (WMS), product code commonly used by the company to identified the details of the materials.
ORDER PICKING
Order picking is a process retrieving items from warehouse storage locations to satisfy customer orders (Petersen, 2002). Orders typically consist of a list of stock keeping units or “line items” that specifies the delivery date, customer address, and method of payment as well as the type and amount of material required (Bozer and White, 1990).
The most common objective of order-picking systems is to maximize the service level subject to resource constraints such as labor, machines, and capital investment (Goetschalckx and Ashayeri, 1989). A significance relationship between order picking and service level is how quick an order can be replenished and the total time needed for sending out to the customer.
According to Bartholdi and Hackman, 2005, ‘travel time is waste. It costs labor hours but does not add value’. It is, therefore, a first candidate for improvement. The travel time can be reduced by increase the number of orders.
There are five methods of order picking that been used in the industry. Methods that employing humans to conduct are picker-to-parts, put system and parts-to-picker. While, automated picking and picking robots are totally done by robots. (Koster et al.2007).
Nowadays, there are two methods of order picking practice in the warehouse. Firstly, single order picking that required one order should be completed by each order picker. Second, orders that are batched together for order picker to retrieve are known as batch picking.
In the context of warehouse efficiency, order picking is recognized as task to fulfill customers’ order and satisfy customers’ need. Every workers includes the top management have to know the exactly place of the materials. The travel time increased due to the pickers do not know the exactly place that the parts stored. We should reduce the travel time to improve the picking accuracy and cut the costs.
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PACKAGING
Packaging is important to the warehouse’s manager. This is because the size, shape, and type of packaging will affect warehouse operation. The size of the packaging may affect the ability of a company to use pallets, or shelving or different types of materials handling equipment. So some companies have to be given to the packaging in order to use the warehouse efficiency. They design packages that are too high and too wide for efficient use of a warehouse.
Besides that, goods stored in a warehouse have to be identified properly so that they can locate correctly and easily. Packaging is improvement of efficiency in handling and distributing packages. A major concern in dealing with packaging is the ease of handling in conjunction with materials handling and transportation. The important considerations fall to three areas, physical dimensions of the package, strength of the packaging, and packaging shape.
Generally, there are two types of packaging, consumer packaging or interior packaging, and industrial or exterior packaging. The marketing manager is usually concerned about the farmer since the consumer packaging provides information important in selling the product. The logistics manager is usually concern to industrial packaging. This is the area that provides protection to the goods that will be move and store in the warehouse and permits the effective use of the space available of transportation vehicles.
The most common are use in corrugated fibreboard, steel, plastic, and wood. Corrugated fibreboard is most commonly used for consumer durables, such as washing machines, matchboxes, paints, and electronics goods. Steel is recommended for chemicals and lubricants. Plastic is quite common in logistical packaging, different type of plastic for different type of goods, such as plastic straps is used for unitized material in small packs. Wood is the commonly used for construction of pallets or crates.
The packaging cost depends on the type of product. The maximum expenditure is on worthy packaging.
SORTATION
Sortation in this context refers to the proper arrangement of many different SKUs stock-keeping units (SKUs) for storage and/or for picking into individual customer orders (Tompkins et al. 2003). From the definitions given, we can conclude that a sortation activity is the process of goods arrangement for separate the items based on their specifications of many different SKUs or stock keeping units. According to Koster et al (2007), when batching and or zoning is applied, usually some additional effort is needed to split the batch and to consolidate the items per customer order or per destinations to which orders will be shipped. These processes are often called accumulation or sorting (A/S). It would be easier for storage and shipping to doing their working stage completely into individual customer orders.
According to Rushton et al (200 ), sortation might occur immediately after picking so that items can be assembled into the appropriate orders ready for packing or dispatch. Where there is a separate packing operation, sortation may also occur after packing so that the packed goods can be assembled into vehicle loads. Sortation after packing goods could be assembled into vehicle loads in the same time it can increase the warehouse productivity and reduce the waiting time in the warehouse operations.
In the other words, according to Gu et al (2007), sortation can be performed either during the picking process or after the picking process. When it performed during the picking process there quite straightforward and is typically modeled by inflating the item extraction time. Besides that, after the picking process in sortation activity functional is perform by a separate downstream sorting system. Sorting system used in warehouse usually includes an accumulation conveyor, a recirculation conveyor, and exit lanes, and they operate simultaneously on all the orders in a single pick-wave.
High speed sortation systems normally use a continuous loop conveyor moving between off-take chutes or conveyors set around both sides of the main conveyor. There are three of high speed sortation systems that available to ensure the warehouse efficiency could increase. It includes sliding shoe sorters, tilt-tray sorters and cross-belt sorters. Firstly, the sliding shoe sorters. It functions when the goods would reach the appropriate destination point and the shoes slide across to divert the goods down the spur. These systems are suitable for cartons and tote bins of regular shape and reasonable rigidity typically operating rates are about 4,000 to 6,000 sorts per hour. Secondly are tilt-tray sorters. The configuration normally laid out in horizontal carousel by tilting conveyors could use for high speed sortation operation such as parcel distribution and cross docking installations. Lastly, cross-belt sorters, this sorters process starts up with appropriate of mini conveyor when the item reaches and the movement suitable for a wide range of items (Rushton et al, ).
In the context of warehouse efficiency, selection of sortation systems or selecting the compact requirement can increase the operation of a warehouse and in the same time can reduce space requirements during warehouse activities. For example when large sortation system may be replaced by several small systems placed at various regions of the warehouse. Further, narrow aisle trucks help reduce aisle space (Hassan, 2002). Besides that effectiveness and speed of application system could increase when information technology and coding system such as bar code are used.
UNITIZING AND SHIPPING
According to Rogers (2010), unitizing is the process of aggregating several items into a single unit load. That means all the goods would be assembled become a single load so that the unitizing process makes the loading trucks process easier and efficiency based on customer needs. In the same time it also could reduce the waiting time and storage cost. Meanwhile, shipping is the last sequence in the warehouse operations.
According to Faber et al (2002), shipping generates information to control the organizations of loads. Shipping documents like bill of loading, custom clearance are prepared. These activities would be involved of loading goods into carrier and leave the warehouse through the shipping docks. While the loading process, there would committing the final check before shipping invoice and for possible damage are made (Gunasekaran et al, 1999). This final check is important because it can show whether the need of the entire document related to the goods is fulfill the specification requirement or not. There are few of common unitizing and shipping activities and it includes container optimizations.
According to Frazelle (2002), there are few of common shipping activities including container optimization, container loading and void fill, weigh checking, automated loading and dock management. First is container optimization, select cost and space-effective handling units that means shipping selection from all kinds of containers such as cartons, totes, pallet, trailers and others could be determine whether the efficiency in warehouse can achieve or not. Containers should have features to protect, secure, and identify the merchandise they contain such as position container lock and seal and bar code container tracking to provide a better view of warehouse operation. Containers should be arranged in stack and net easily to prevent space wastage for eliminating extra bulk as well for store more product in the same place besides to provide an easy for any tracking and tracing.
Besides that, container load plans should be developed to prevent load failure with conduct a visual inspection (Rogers, 2010). It could be start from see whether the load is wrapped at the top, middle and bottom and ensure there is not wrapping material trailing off loading. These methods could prevent to expend time and money for unloading a truck with the damage goods and should not be selling.
Environmentally friendly should be stressed while dunnage in order to overcome the unexpected damage when transfer process and in transit such as air pack, Styrofoam pads and polystyrene peanuts. The dunnage features needs to be recyclable and reusable to reduce the impact of landfills. Some examples of the recyclable and reusable containers are plastic pallets, plastic totes collapsible roll cages, and multiuse corrugated containers. Air packs and styrofoam are the example recyclable and reusable dunnage.
Furthermore outbound containers should be weighed and cubed for load planning purpose. Weigh checking is important to detect whether the goods are done in the right process before there arrive in this stage. Any picking and packing error should be measured before product loading and would be sending to the customers.
In the context of warehouse efficiency, shipping activities help in term of reduce the error with checking goods while loading into the carrier. This process to ensure the goods are fulfils the requirements specification. In the other hand, shipping also can reduce cost with using the recyclable and reusable containers besides reduce the impact of landfills become environmentally friendly.
HEALTH AND SEFETY
Health and safety important in the warehouse because process there involve with machine, big and heavy things. There are a lot of danger faces by the personnel during the transaction of the goods. One of major cause of injuries in the warehouse is by worker slipping and tripping. There are also accident occur during manual handling like been hit by moving or falling object.
Manager need to consider the health and safety part for their workers when designing and layout the warehouse. Design and layout affect the process in transaction of goods directly. For example, goods need to carefully handle and because of some design and layout that not perfect for handling the specific goods, sometime it will cause accident in the warehouse. There also need to have safe system or traffic management. Manager need to consider about some issue such as the storage area, aisle, traffic route, staircases and many more to build a safety layout of warehouse.
Fire safety also one major things in the warehouse development that need to consider first before moving the goods from the containers. According to (The Health and Safety Executive, 2007), there are 5 step of fire safety legislation to ensure the safety in the warehouse :
Step 1 identifies fire hazards (sources of ignition, fuel and oxygen);
Step 2 identifies people at risk;
Step 3 evaluate, remove, reduce and protect from risk (evaluate, remove or reduce fire hazards and evaluate, remove or reduce the risks to people);
Step 4 record, plan, inform, instruct and train (record significant findings and action taken, prepare an emergency plan, inform and instruct relevant people, and provide fire safety training for your staff); and
Step 5 reviews and revise your assessment as necessary.
During the movement of goods in the warehouse, personnel need to see clearly the road to the storage or from storage to the designated place. For that reason manager need to make a good lighting arrangement. This is needed because accident might occur during the transaction of goods if the personnel didn’t see which way they suppose to go. Not only the way, have stairs also needed to be well lit because using the stairs included in the working process. Manager also needs to consider the brightness that suitable in each section because some work didn’t need much light and some does and it will cause visual discomfort to the personnel if they put wrong arrangement for that lighting. This is one of factor that will cause accident or stress to the personnel and lead to other mistake.
Manager need to consider the workforce that need in the warehouse for the safety and healthy warehouse. There are many kinds of workforce such as young and old, male and female, experience and inexperience. These workforces need different way to handle them and they can’t be freely do the work without instruction or guide. For example, female can’t always carry heavy loads or working in long hour especially pregnant and breastfeeding workers.
In the context of warehouse efficiency, health and safety cover all operation in the warehouse. Each operation need the safety and healthy guideline to prevent accident occur during the process. There are several guidelines can imply in the process such the steps of fire safety legislation. Applying these step can reduce the loss or damage if there are fire occur during or before the operation begin. Other than that, health and safety also tell about how to plan for layout in warehouse such the lighting, criteria for human power need in the warehouse and many more. These guidelines are made to prevent anything bad happen and to make the operation move smoothly.
LAYOUT
There are 14 elements that should be taken care by warehouse personnel. First is specifying the type and purpose of the warehouse follow by forecast and analysis of the expected demand, est
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