BlogSupply Chain: Lowering Your Total Cost of BusinessLean warehousing principles keep a warehouse flexible and responsive.

Many logistics coordinators see their main task as ensuring that there is enough inventory on hand at all times to meet demands. Their biggest concern is running short of products or components, leaving them unable to meet customers’ needs. However, an excess of inventory is also a problem that can leave your warehouses and distribution centers struggling to stay on schedule. That’s because employees must find space for–and work around–extra inventory. Time lost rearranging inventory can make it hard for warehouse workers to move product in and out efficiently.

Lean warehousing principles are aimed at addressing inefficiencies like these throughout the supply chain using a methodological approach to warehouse inventory management. The aim of lean warehousing principles is to keep the supply chain as flexible and responsive to demand as possible. The result is higher efficiency and productivity that lowers operating costs and saves you money.

Defining Lean Warehousing Principles for Your Business

Lean warehouse methods and principles help standardize processes.The fundamental principle of lean warehousing can be described with the phrase, “just enough to get the job done.” Inventories should arrive just before they need to be shipped out and in just large enough quantity that any losses due to damage in transit can be covered. Handling should be kept to a minimum, and during every step in the process, employees and management should seek ways to improve efficiency even further. In this way, lean warehousing practices are as much a philosophy as they are a management technique, and they offer a lot of flexibility in application. One good way to begin implementing lean in the warehouse is with the 5S organization method, which can be applied to nearly any facility:

  • Sort: The most important step in bringing lean practices to the warehouse is organizing the warehouse, and not just in the physical sense. By taking a broad, bird’s-eye view of the warehouse’s operations, you can break them down by inventory and type of task. The secret to lean warehouse practices is to reduce the steps in these tasks to the absolute minimum needed.
    • For example, a distribution center might store similar items handled in the exact same manner in different areas because they come from different manufacturers. Consolidating these items in a single location would reduce both storage and retrieval times and could help maximize warehouse space.
  • Set: Once you’ve reduced the number of warehouse operations to the absolute minimum needed to achieve throughput, consider how to arrange warehouse inventory, racks, storage areas, and equipment so that each of those mandatory tasks takes as little time as possible to complete.
    • Once you’ve made the decision to consolidate certain storage areas, lay them out in a manner that optimizes operations. Heavy and fragile items that need special handling can be stored closer to the loading docks to reduce the distance that has to be traversed. Lighter items that need less care in handling can be placed farther away.
  • Shine: This is a reference to the maintenance aspect of keeping a lean warehouse. Clutter, excess inventory in holding, and unused equipment need to either be removed, pushed through to their destination, or put to work in the warehouse. Keeping your warehouse clean and well organized is critical to maintaining lean, efficient operations.
    • Establishing a maintenance reporting schedule at the end of each shift helps ensure that your equipment is in good repair. Designating clean-up times during the day keeps access ways clear, and can help prevent equipment damage and employee injury due to accidents.
  • Standardize: Uniformity of communication and processes is an important part of minimizing the time it takes to perform operations in the warehouse. A forklift driver that doesn’t know where to place a pallet or a supervisor who isn’t entirely sure where a freshly arrived shipment needs to go will delay operations. In order to get the most out of lean warehouse practices, labels and paperwork need to be uniform and clear, and handling and equipment platforms need to be interchangeable.
    • An example of standardization might be a shipping manifest that clearly lists what is in the load alongside the measures needed to handle the products safely. This allows the supervisor receiving the shipment to see at a glance what the load is and to instruct employees to take it where it needs to go. Employees should also be trained on where the designated storage areas are, and how to safely handle all inventory.
  • Sustain: One of the biggest messages of lean is that improvements are not a one-time occurrence. A lean warehouse is always improving, and management and workers must collaborate to look for ways to create greater efficiencies. Lean warehousing principles demand incremental, sustained improvement over time.
    • Employees who think they see a better way of doing their jobs should feel welcome to speak to their supervisors about their ideas, and supervisors should take employees’ input seriously. This should be just as true for the warehouse driver on the floor as it is for a senior vice-president.

The difficulty in applying lean warehousing principles is that every supply chain and every warehouse in those supply chains is different. Lean warehouse practices that improve efficiency at a dairy manufacturer’s warehouse will not always be applicable to a storage facility that provides grocery stores with fresh tomatoes and lettuce. Lean warehousing principles should be tailored to each location and each process in that location.

Adopting Lean Warehousing Principle Across the Supply Chain

Creating bespoke practices for each warehouse requires two-way communication at every level of the supply chain. This takes effort, but efficiency improvements and optimization throughout the supply chain reduces your total cost of business and can add up substantially over time.

Other aspects of adopting lean warehousing principles are relatively easy. Standardized nomenclature and labeling can be implemented swiftly once the necessary information is gathered. Equipment changes are easier to implement than staff trainings and can be a good place to start for warehouses looking to make a broad change to increase overall efficiency. For example, plastic pallets can provide much greater uniformity and durability than wood pallets. Plastic’s strength and consistency are especially important in lean supply chains where excess inventories are by design kept to a minimum, and pallet failure can leave a warehouse short on inventory. And, because plastic pallets do away with the wood debris that plagues many warehouses, switching to plastic platforms can help a warehouse with the third S in the 5S lean organization method: Shine.

Tracking allows a warehouse to map operations in order to find places that could use improvement and continue to monitor them to refine lean processes further.

High-quality plastic pallets have even more features that make them attractive for lean warehousing. Some are equipped with GS1 standard Global Returnable Asset Identifiers (GRAI). This GRAI number can be tracked and is readable through scanning and RFID with the right equipment. Tracking at this level can help support the Sort and Sustain elements of lean supply chain management. It allows a warehouse to map operations in order to find places that could use improvement and continue to monitor them to refine lean processes further. All of these advantages mean that making just one switch in your warehouse–from wood pallets to plastic pallets–can go a long way toward helping your warehouse to remain clean, organized, and even shiny.

The iGPS plastic pallet is a high-quality pooled shipping platform equipped with GS1 standard GRAI numbers to make your warehouse leaner and more efficient. To switch to rental of a uniform, lightweight plastic pallet, give our team a call at 1-800-884-0225, email a specialist at [email protected], or visit our contact page.