Monday, August 19, 2013

ERP and Time Off

A friend of mine asked me last year after I commented on his vacation photos when was I going to take some time off.  I asked him “what does vacation mean?”  He kindly reminded me that in order to stay fresh you need time off.  You need to recharge your batteries.  If you wear yourself completely out, then there will be no reserve when the need arises.


Does your Enterprise Resource Planning (ERP) system need time off?  How about the people who are in charge of keeping it running at an optimal level?  The physical systems these software solutions run on today are very reliable and the industry talks about unplanned downtime.  There is a difference between downtime and availability.  Even the best systems need to be patched, repaired, and restarted periodically.  It just helps to refresh them from time to time.  Not every day, but periodically.  Schedule the refreshes so the unplanned down time is minimized or eliminated.


If you are like me you run full out, full time, and just keep going doing the very best you can with the resources at your disposal.  I do not run marathon races, but I often wonder if that is what it is like for the runners when the get to “that point”, somewhere around 19 or 20 miles into the 26 mile race.  At that point, whenever it comes, your mind and body are just running on fumes and you are relying on your training and endurance to carry you through.


We as people need to recharge, our equipment needs periodic refreshes.  What about our software?  The instructions the equipment carries out, day-in and day-out.  Are there any variables in what we process daily?


If what we do was exactly the same every time we did it, then why do we have to be there?  Robots and automation could run the production lines and we could be on vacation all of the time.  There is a reason people are involved.  It sometimes takes a judgment call to make a decision.  Which priority order is most important?  Which customer comes first?  Which order has a higher value?  Which customer does more business with me during the year?  Can I pull from one order and fulfill another and then replace the inventory before the original order is due to ship?


The ERP software itself does not need a vacation, but it does need periodic refreshes. 


There are a few industries that change slowly, but most have to keep up with a constantly changing market, disruptions and changes in the supply chain, new customers and markets demands. 


Customer service is something that never, ever goes out of style.


Most ERP solution providers have periodic refreshes and updates.  They create new modules and enhancements.  They have user conferences.  They listen to your needs.  They create fixes and updates to address the constant changes that the evolution of your industry is going through.  Changes that you are going through right now. 


Do you recognize the changes you are in right now?


When you drive you car on new tires, you feel the road, you feel in control.  Then time passes.  You get involved in other things.  Your concentration is on other points of interest.  Then one day you realize that it took a little longer to stop, you went a little wider on that last turn.  Then it dawns on you.  You thought that everything was the same and what you found out is that your tires have worn out and they need to be replaced.


Software is not exactly like tires.  Perhaps the equipment it runs on is more similar.  But the same thing happens.  You build a new solution that handles your customers and process your work load.  Your business grows, you have more customers and suppliers that have different reporting requirements.  You add new employees.  The business adds disconnected software modules and ties them together with shoe strings and then one day – you skid out of control.


Does your ERP solution need a vacation?  How about a refresh?  How about a replacement?


I may not have realized that I needed a vacation last year, but I do now.  I know how to work hard and I am sure you do too.  Are you running your software or is your software running you?  Is your software running out of control? 


At Dolvin Consulting we are here to help you navigate the changes and find solutions to the challenges that have the greatest impact on your business operations.  Contact us today to see how we can help.


Monday, August 5, 2013

Does Inventory Bin Processing Work?

Any organization that struggles with inventory at some points wonders if the bin processing feature would actually work for them.  Bin processing may have several different names depending on the Enterprise Resource Planning (ERP) solution being used or planned. 


In its most basic form, Bin processing segments the warehouse facility into discrete named locations.  There are different types of bins, some of the most common are bulk storage and picking.  Bulk stocking locations are designed for large pallet type ordering and will often contain overstock and is located further away from picking, staging or shipping areas.  Picking areas are situated for the majority of picking operations.  One example may be, 80% of your orders are by the case and these items are stored in the picking areas of the warehouse.  10% of your orders are by pallet and the remaining 10% are bulk storage for replenishment of the standard picking units. 


This sounds more complicated than it actually is.  The point is that inventory should be stored where it can be replenished and picked with the greatest efficiency.  The actual names and percentages are not as important as understanding how your organization stores and picks inventory to fulfill order processing.


The question to consider is whether or not you want to trust the computer system to manage that inventory storage.  If you cannot trust your system, then you are either using the wrong system, or do not have a system.


Trust is the key.


I was asked recently if I thought Bin processing worked.  The organization had limited space, a lot of inventory, and a lot of movement.  They were physically moving the inventory and redrawing maps by hand to accommodate the changes. 


Contrast this with a system that manages where to place and where to find inventory (automatically).


There is a lot of overhead in the manual processing this company performs.  Regardless, they are doing well.  They order, receive, move inventory, pick and ship inventory.  They have adapted over time to a system that is an efficient method of inventory handling, for them.  Their system would not likely work well with another company’s warehouse. 


They have adapted.  They use the resources they have to operate and fulfill their customer’s needs.


When asked if I thought bin processing would work, two thoughts went through my mind. 


One, they would not be asking if they were running as well as they thought they could.  People do not generally look for answers to unasked questions.  They are working, operating as well as they could, but obviously they are hitting a performance wall.  Not enough space, not enough people, not enough sales, not enough something.


Two, the answer is “Yes”, but… yes, if they let (trust) the system do what it is designed to do.  Most modern inventory systems work, if you let them do the work.  Automated systems look at inventory transactions and movements and will let you know where to store received items and when and where to replenish picked items.  They system “knows” where the inventory is.   The system “checks” and verifies the locations as inventory is processed (handled).  The system “knows” where the inventory is and what to list for picking or put-away operations. 


The problem usually comes in several forms. 


One, people try to out think the system.  A lot of time and energy goes into a modern inventory (IM) and warehouse management system (WMS).  A lot of smart people and a lot of trial and error went into these systems.   The systems work.   They work if you let them do what they are designed to do and you learn to trust them.


Two, some people as well intentioned or negligently move inventory and do not inform the system.  People are smart too.  People invented computerized systems and recognize their limitations.  This is a good thing.  This knowledge can be used to further tweak the systems.  Good systems learn from their users.  The problem comes from people acting independently.  If you touch and move inventory, then you need to let the system know about any and ALL changes.  The sooner, the better. 


A nice feature in newer systems is what is called Count-back systems and they are another asset to modern systems that are used to verify and an increase the accuracy of inventory.  Count-backs from an overview seem to add extra time to inventory picking, however, in the long run inventory accuracy is enforced and confidence builds.  Workers begin to trust the system. 


For example, if you send someone to a location that should contain 100 cases of inventory and they are supposed to pick 20.  This means when they count the remaining there should be 80 left.  If there is not, then the system halts until the problem is resolved (bypassed in an emergency).  This practice holds the people accountable.  They learn quickly that they need to get the inventory processing correct.  They have responsibility. 


Inaccuracy is not acceptable.


So yes, inventory bin processing works, if you let the system manage the inventory.  Do not get creative, let the system work for you and not the other way around.  It is like cutting wood with a saw.  You can force the saw into the wood and get an inaccurate sloppy cut or you can let the saw process the wood at the pace it is designed and get a clean accurate cut that does not need to be repeated, reduces waste and ends-up increasing efficiency (savings).


Hopefully this overview makes you stop and wonder if you are taking full advantage of your inventory system and the efficiencies and savings it can bring to your operations.  There are many aspects to these systems, the above is just one example. 


Contact us today at Dolvin Consulting to learn more about what a modern inventory control and warehouse management system can do for your company.  We are here and love to help.