Euclides A. Coimbra and his associates at the Kaizen Institute have created a wonderful and detailed work on the application of continuous improvement to supply chains. Here is a full exploration and application of lean from end to end of the extended value stream. Two thumbs up!
Some of the graphics look to once have been powerpoint and when reproduced are to small and grainy to be able to read. There isn’t an index so finding topics is limited to the table of contents. The book is hard bound, and printed on good paper.
Some of the vocabulary is odd; “border of line” might be better said as” interface” or “borderline”.
Economic Order Quantity, or as referred to in this book, Wilson’s Formula, is treated in a refreshing way.
We can say that Wilson’s formula still applies today. The only problem is when people assume that changeover time (or, generally speaking, ordering cost) is rigid and cannot be reduced. Many people don’t think to do Wilson’s calculations because they are still misled by two strong paradigms: flow at any cost and efficiency at any cost.
The ‘flow at any cost’ paradigm is a rising paradigm that is currently gaining in popularity. People hear about the wonderful Toyota Production System (TPS) and start to increase the flow by reducing the batch sizes blindly, without looking at Wilson’s formula. What happens is that the CAPEX requirements explode, because the small batch sizes together with big changeover times decrease efficiency. The result is that flow is indeed achieved – but at the expense of capital expenditure, not by internally reducing the changeover time and increasing equipment flexibility. You can see this effect in many rich companies that are implementing Lean manufacturing and the TPS.
For a more in depth review check out Jon Miller’s posting on Gemba Panta Rei,
Review of Total Flow Management by Euclides Coimbra.
Hot off the press from the Lean Enterprise Institute …
Page 12 & 13 have a brief description of Coefficient of Variation and a SKU Scatter Diagram (weekly volume vs. SKU stability). 10 weeks usually isn’t sufficient for meaningful or statistically significant calculation of standard deviation.
The guidelines given need to be tempered with the granularity of the data. While a coefficient of variation of less than 1.0 can be considered stable for weekly data, it would be considered very noisy when using monthly data and quite stable when using daily demand.
This small quibble aside the authors Martichenko and von Grabe do a wonderful job describing lean principles for the supply chain, or as they prefer, the fulfillment stream.
  
Combining the questions of green and sustainability with the application of lean thinking to supply chain and logistics I offer these current publications for your consideration.
Hot, Flat, and Crowded, by Thomas Friedman, author of The World is Flat, presents two cases 1) the impact of global warming, population growth, rise of a global middle class through globalization, and 2) America’s loss of focus and national purpose since 9/11, combine to ever greater instability. The rise of new powerful economic nations is completely changing the way the world works. Whether you buy in to the doom and gloom you might give some thought to how solving these problems present the greatest economic opportunity of our time.
Streamlined: 14 Principles of building & Managing the Lean Supply Chain by Mandyam M. Srinivasan stresses systems thinking. It integrates two management philosophies: the theory of constraints and lean thinking, and illustrating how they complement and reinforce each other to create the smooth flow of goods and services through the supply chain. Thought provoking.
End-to-End Lean Management by Robert Trent describes a broad array of waste that affects all supply chains and shows how to make lean performance improvement a reality across your entire supply chain. Trent he explains and details key lean objectives, including standardization, flow, optimization, and waste elimination. An easy read.
 Hot off the press, written by plant manager Brett Wills, with first hand experience on the challenges faced trying to move an organization in the green direction. Part 1, Going Green, applies value stream mapping and the ‘seven wastes’ to identifying opportunities. Part 2, The Seven Green Wastes, provides guidelines for reducing each of the wastes.
Available at Amazon and CRC Press
In most warehouses the material handlers travel empty more than 60% of the time. Long pick paths and poor product placement can make labor even more inefficient. Slotting your warehouse based on travel distance and customer demand can save 5-10% on labor. When handling issues, product groups, order patterns are factored in an additional 3-5% labor productivity can be had. Also increasing storage density can create free space for additional opportunities; more efficient put away, right sizing bins, promotions and new product roll outs.
Finding the warehouse ‘squatters’, the slow moving stock that’s sitting in the wrong place, isn’t too difficult. Squatters force the pickers to travel further to get to the active product locations. Over time squatters increase and migrate forward forcing longer and longer hunting trips. A quick and dirty way to find the squatters is to take your picking transactions and count the number of transactions and sort by location. A low number of picks in a location right next to one with high picks is a clue. Depending on your location address naming scheme this sorting can be confusing. Also, unfortunately spreadsheet slicing and dicing can only take you so far, typically only to making one pass on the product velocity. When you add other factors besides distance and velocity you need a better tool than Excel.
Slot3D by IDS Engineering is a warehouse slotting tool that combines AutoCAD with an economic algorithm that is highly visual, flexible, and powerful. Slot3D translates business rules into configuration parameters and along with SKU and order history calculates the picking, replenishment, and storage costs for each item and slot in the warehouse. The system recognizes different material handling equipment capabilities and location sizes and characteristics. Rules and restrictions provide mechanisms to prioritize areas of the facility to produce golden zones, bulls eyes, and hot zones. By allowing the user to structure the rules the software is flexible and not locked into a set of preconfigured algorithms.
The 3D capabilities of AutoCAD allow you to see the overall slotting optimization by providing a heat map of the facility.
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