First form of waste: Inventory

We can call it ‘Lean’ or Spanish proverb, but the solution to be applied after making the appropriate mapping of the value chain, current and future, and analyze the corresponding Kaizen, it has been to ‘Do not leave for tomorrow what you can do today’.

The inventory is waste because it costs, hinders the execution of processes, causes devote resources to its count and control that could devote to more productive operations.

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Only these reasons are enough to stop here and see examples of projects where reducing inventory, get more efficient.

Traditionally we consider inventory as something physical, material, but in the example we are going to talk we are talking about orders that accumulate in storage after being processed in the department of ‘Customer Experience’.

The commitment of the Logistics Department was three working days of service for the peninsula, Spain and Portugal, in 95% of cases. The three business days consisted of two days of handling time in storage and transport one day.

Orders are processed on day 0 and ‘store’ had the commitment, 100% of cases, sending between day 1 and 2 for 3 day delivery.

The ‘store’ therefore could allow some flexibility, ‘if you do not have time to send today everything was processed yesterday, still I have tomorrow …’

Transport, no. He had a business to deliver a service-level agreement 95% day. But ‘to have controlled the Carrier …’

The fact is that the inventory of orders accumulated uncontrollably in the warehouse management system.

We can call it ‘Lean’ or Spanish proverb. The solution to apply after making the appropriate mapping of the value chain, current and future, and analyze the corresponding Kaizen was:

Do not leave for tomorrow what you can do today
Or what is the same, adjust our processes to achieve a reduction in handling time in store one day and reduce our total logistics cycle time from three to two business days.

They worked on:

• Reduction of number of series in our store to make visits to sites of high turnover less frequent and more productive
• If peaks, prioritize activities store
• Knowing in advance the inflow of orders
• Manage originating truck arrival to avoid affecting Receptions outflows

The consequences of this process were, first, a double reduction of inventory: firstly, reducing still waiting orders and inventory reduction in our facilities, with estimated savings of 500,000 euros.

an average advance half-day billing was also achieved in addition to the improvement not only of service perceived by customers, but also reduced variability thereof, with fewer errors, returns and emergency department store and the carrier with consequent improvement in productivity related KPIs.

 

 

First form of waste: Inventory

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