Order Picking Optimization in a Distribution Center

This study focuses on the order picking process of a distribution center (DC) supplying locomotive and railroad car parts. The DC employs a manual picker-to-parts system where pickers move on foot or by vehicular means. Efficiency of an order picking process in such a DC mainly depends on three problems when the layout of the DC is given: the storage location assignment problem (SLAP), the order batching problem and the order picker routing problem. This study focuses on the aggregate effect three major decisions have on order picking performance in a manual picker-to-parts warehouse. To study the effects of these three sub-problems, we create a framework that allows us to run simulated scenarios with different approaches to these problems. To solve the SLAP, we employ a hybrid of class-based and family grouping methods by enhancing a class-based SKU location assignment with modern clustering techniques. To further improve the order picking process, we experiment with various order batching methods. We use picker routing heuristics to evaluate combinations of the storage location assignments and batching procedures. Over a set of order lines to be fulfilled, the objective function is be the aggregate distance covered over the warehouse floor. We show that distance savings of more than 55% can be achieved by rearranging the DC. Moreover, we show that stock keeping unit (SKU) clustering can improve the performance of class-based storage location assignments and that even simple order batching algorithms are likely to improve order picking performance significantly. Based on the framework, we develop a tool set that encompasses the aspects concerning the DC’s order picking process. The solution will be implemented into a cloud-computing environment, allowing for real-time tracking of the DC’s order picking efficiency and the generation of visual tools that help move SKUs to desirable shelf locations and batch orders

Design and Control of Warehouse Order Picking: a literature review

Order picking has long been identified as the most labour-intensive and costly activity for almost every warehouse; the cost of order picking is estimated to be as much as 55% of the total warehouse operating expense. Any underperformance in order picking can lead to unsatisfactory service and high operational cost for its warehouse, and consequently for the whole supply chain. In order to operate efficiently, the orderpicking process needs to be robustly designed and optimally controlled. This paper gives a literature overview on typical decision problems in design and control of manual order-picking processes. We focus on optimal (internal) layout design, storage assignment methods, routing methods, order batching and zoning. The research in this area has grown rapidly recently. Still, combinations of the above areas have hardly been explored. Order-picking system developments in practice lead to promising new research directions.Order picking;Logistics;Warehouse Management

Online fulfillment: f-warehouse order consolidation and bops store picking problems

Fulfillment of online retail orders is a critical challenge for retailers since the legacy infrastructure and control methods are ill suited for online retail. The primary performance goal of online fulfillment is speed or fast fulfillment, requiring received orders to be shipped or ready for pickup within a few hours. Several novel numerical problems characterize fast fulfillment operations and this research solves two such problems. Order fulfillment warehouses (F-Warehouses) are a critical component of the physical internet behind online retail supply chains. Two key distinguishing features of an F-Warehouse are (i) Explosive Storage Policy – A unique item can be stored simultaneously in multiple bin locations dispersed through the warehouse, and (ii) Commingled Bins – A bin can stock several different items simultaneously. The inventory dispersion profile of an item is therefore temporal and non-repetitive. The order arrival process is continuous, and each order consists of one or more items. From the set of pending orders, efficient picking lists of 10-15 items are generated. A picklist of items is collected in a tote, which is then transported to a packaging station, where items belonging to the same order are consolidated into a shipment package. There are multiple such stations. This research formulates and solves the order consolidation problem. At any time, a batch of totes are to be processed through several available order packaging stations. Tote assignment to a station will determine whether an order will be shipped in a single package or multiple packages. Reduced shipping costs are a key operational goal of an online retailer, and the number of packages is a determining factor. The decision variable is which station a tote should be assigned to, and the performance objective is to minimize the number of packages and balance the packaging station workload. This research first formulates the order consolidation problem as a mixed integer programming model, and then develops two fast heuristics (#1 and #2) plus two clustering algorithm derived solutions. For small problems, the heuristic #2 is on average within 4.1% of the optimal solution. For larger problems heuristic #2 outperforms all other algorithms. Performance behavior of heuristic #2 is further studied as a function of several characteristics. S-Strategy fulfillment is a store-based solution for fulfilling online customer orders. The S-Strategy is driven by two key motivations, first, retailers have a network of stores where the inventory is already dispersed, and second, the expectation is that forward positioned inventory could be faster and more economical than a warehouse based F-Strategy. Orders are picked from store inventory and then the customer picks up from the store (BOPS). A BOPS store has two distinguishing features (i) In addition to shelf stock, the layout includes a space constrained back stock of selected items, and (ii) a set of dedicated pickers who are scheduled to fulfill orders. This research solves two BOFS related problems: (i) Back stock strategy: Assignment of items located in the back stock and (ii) Picker scheduling: Effect of numbers of picker and work hours. A continuous flow of incoming orders is assumed for both problems and the objective is fulfillment time and labor cost minimization. For the back-stock problem an assignment rule based on order frequency, forward location and order basket correlations achieves a 17.6% improvement over a no back-stock store, while a rule based only on order frequency achieves a 12.4 % improvement. Additional experiments across a range of order baskets are reported

Integrated Models and Tools for Design and Management of Global Supply Chain

In modern and global supply chain, the increasing trend toward product variety, level of service, short delivery delay and response time to consumers, highlight the importance to set and configure smooth and efficient logistic processes and operations. In order to comply such purposes the supply chain management (SCM) theory entails a wide set of models, algorithms, procedure, tools and best practices for the design, the management and control of articulated supply chain networks and logistics nodes. The purpose of this Ph.D. dissertation is going in detail on the principle aspects and concerns of supply chain network and warehousing systems, by proposing and illustrating useful methods, procedures and support-decision tools for the design and management of real instance applications, such those currently face by enterprises. In particular, after a comprehensive literature review of the principal warehousing issues and entities, the manuscript focuses on design top-down procedure for both less-than-unit-load OPS and unit-load storage systems. For both, decision-support software platforms are illustrated as useful tools to address the optimization of the warehousing performances and efficiency metrics. The development of such interfaces enables to test the effectiveness of the proposed hierarchical top-down procedure with huge real case studies, taken by industry applications. Whether the large part of the manuscript deals with micro concerns of warehousing nodes, also macro issues and aspects related to the planning, design, and management of the whole supply chain are enquired and discussed. The integration of macro criticalities, such as the design of the supply chain infrastructure and the placement of the logistic nodes, with micro concerns, such the design of warehousing nodes and the management of material handling, is addressed through the definition of integrated models and procedures, involving the overall supply chain and the whole product life cycle. A new integrated perspective should be applied in study and planning of global supply chains. Each aspect of the reality influences the others. Each product consumed by a customer tells a story, made by activities, transformations, handling, processes, traveling around the world. Each step of this story accounts costs, time, resources exploitation, labor, waste, pollution. The economical and environmental sustainability of the modern global supply chain is the challenge to face

Warehouse design and product assignment and allocation: A mathematical programming model

Warehouses can be considered one of the most important nodes in supply chains. The dynamic nature of today's markets compels organizations to an incessant reassessment in an effort to respond to continuous challenges. Therefore warehouses must be continually re-evaluated to ensure that they are consistent with both market's demands and management's strategies. In this paper we discuss a mathematical programming model aiming to support product assignment and allocation to the functional areas as well as the size of each area. In particular a large mixed-integer programming model (MILP) is presented to capture the tradeoffs among the different warehouse costs in order to achieve global optimal design satisfying throughput requirements

Design and Control of Warehouse Order Picking: a literature review

Order picking has long been identified as the most labour-intensive and costly activity for almost every warehouse; the cost of order picking is estimated to be as much as 55% of the total warehouse operating expense. Any underperformance in order picking can lead to unsatisfactory service and high operational cost for its warehouse, and consequently for the whole supply chain. In order to operate efficiently, the orderpicking process needs to be robustly designed and optimally controlled. This paper gives a literature overview on typical decision problems in design and control of manual order-picking processes. We focus on optimal (internal) layout design, storage assignment methods, routing methods, order batching and zoning. The research in this area has grown rapidly recently. Still, combinations of the above areas have hardly been explored. Order-picking system developments in practice lead to promising new research directions

Developing the First Phase of Warehouse Storage Design in High-Mix, Low-Volume or Service-Centric Organizations

Conventional warehouse design techniques are tailored for mass production environments. Applying them to a warehouse in a high production mix, low production volume or service- centric operation does not yield expected space and part handling efficiencies. The first phase of design in a warehouse needs to address two key issues viz. the elimination of obsolete parts and storage management of required parts. This thesis develops methodologies to address each of these issues by creating a standardized obsolete part elimination guideline and a comprehensive Class Based Storage (CBS) policy respectively. The standard guideline uses a combination of survey data collection and swim lane mapping technique to create a part excessing Standard Operating Procedure (SOP). The storage policy uses a multi-variable CBS and a standardized bin selection method, both of which are incorporated in a Plan For Each Part (PFEP) database. The application of these two methodologies ensures the right part at the right place in a warehouse. Each methodology is implemented in a suitable warehouse in Tennessee

Clustering outdoor soundscapes using fuzzy ants

A classification algorithm for environmental sound recordings or "soundscapes" is outlined. An ant clustering approach is proposed, in which the behavior of the ants is governed by fuzzy rules. These rules are optimized by a genetic algorithm specially designed in order to achieve the optimal set of homogeneous clusters. Soundscape similarity is expressed as fuzzy resemblance of the shape of the sound pressure level histogram, the frequency spectrum and the spectrum of temporal fluctuations. These represent the loudness, the spectral and the temporal content of the soundscapes. Compared to traditional clustering methods, the advantages of this approach are that no a priori information is needed, such as the desired number of clusters, and that a flexible set of soundscape measures can be used. The clustering algorithm was applied to a set of 1116 acoustic measurements in 16 urban parks of Stockholm. The resulting clusters were validated against visitor's perceptual measurements of soundscape quality