A simulation approach to warehousing policies: the grandvision case

Esta tese de mestrado é um projecto desenvolvido na empresa GrandVision na área da Gestão da Cadeia de Abastecimento, mais concrectamente em Armazenagem, que apesar de muitas vezes desprezada, representa em média entre um quarto a um quinto dos custos logísticos. Apesar dos grandes avanços na tecnologia os armazéns tradicionais, de picking manual, continuam a representar 80% do universo. Aproveitando a vontade da Gestão da empresa em desenvolver projectos de melhoria para o Armazém, foi proposto o estudo ,através de simulação, de novas políticas de Armazenamento e de Picking para a operação de aprovisionamento das lojas MultiOpticas e GrandOptical. Os modelos testados em simulação partiram dos estudos previamente desenvolvidos nesta área e os resultados obtidos estão alinhados com os que foram anteriormente reportados. Com a conclusão desta tese, a Gestão da GrandVision fica no seu dispor de um procedimento de Arrumação baseado em Classes que quando combiando com uma política de Agrupamento de orderns podem trazer poupanças de tempo de ciclo a rondar os 32%, segundo o modelo de simulação.This master thesis is a project which took place in the company GrandVision. It is under the Supply Chain field of study, more precisely Warehousing; which despite having its importance underrated for many times, represents on average from one quarter to one fifth of the overall logistic costs. Regardless of the great technology break-troughs, traditional manual picker-to-part warehousing systems still represent 80% of the universe. Taking advantage of GrandVision’s management will in develop improvement projects to its warehouse; it was proposed the study, through simulation, of new Storage and Picking policies for the weekly Replenishment operation of MultiOpticas and GrandOptical Shops. The simulation models were created based on previous findings in this area of study, and results obtained are according with the ones previously reported in literature. With the conclusion of this master thesis, GrandVision’s management has in its possess a procedure of Class-Based Storage, which combined with a Batching Policy can bring, according with the simulation model, improvements around 32% of the Total Fulfillment Time

Evaluation of order picking systems using simulation

Sipari? toplama faaliyetleri, tedarik zinciri yönetiminde, hem üretim sistemleri açısından (montaj istasyonlarına alt parçaların tedarik edilmesi), hem de dağıtım i?lemleri açısından (mü?teri taleplerinin kar?ılanması) kritik rol oynamaktadır. Mü?teri sipari?lerindeki eğilimler, az sayıda ve yüksek miktarlarda sipari?lerin çok sayıda ve dü?ük miktarlarda sipari?lere dönü?tüğünü göstermektedir. Diğer yandan, talep edilen sipari? teslim süreleri ise her geçen gün kısalmaktadır. Bu deği?imler, i?letmelerin piyasada rekabet edebilmeleri için etkin ve esnek bir sipari? toplama sistemi benimsemelerini gerektirmektedir. Sipari? toplama süreci, tüm lojistik operasyonlarını ve mü?teriye sağlanan hizmet seviyesini büyük ölçüde etkilemektedir. Ayrıca, sipari? toplama süreci toplam depolama maliyetlerinin yarıdan fazlasını olu?turmaktadır. Bu nedenle, sipari? toplama faaliyetlerinin en etkin ?ekilde gerçekle?tirilmesi i?letmeler için büyük önem ta?ımaktadır. Bu çalı?manın amacı, sipari? toplama süresini kısaltarak, sipari? toplama etkinliğini arttırmaya yönelik deği?iklikler için sipari? toplama sistemini değerlendirmek ve geli?tirmektir. Sipari? toplama süresi, ürünlerin depolama alanlarından belirli bir mü?teri talebini kar?ılamak amacıyla toplanması süreci için geçen zamandır. Bu çalı?mada, ürünlerin depolama alanlarına atanma kararları ve rotalama metotları gibi kritik faktörlerin yanı sıra, daha önce gerçekle?tirilmi? çalı?malarda sıkça rastlanmayan depolama alanlarının ikmali problemi dikkate alınmı?tır. Bo?alan rafların yeniden doldurulması kararında, (S, s) envanter politikası uygulanmı?tır. Böylece, sipari? toplama sistemi dinamik olarak modellenmi?tir. Sipari? toplama performansını geli?tirmek için, bağlantı elemanları üreten bir firmanın ambarı temel alınarak olu?turulmu? hipotetik bir ambar üzerinde vii çalı?ılmı?tır. Ambara ait farklı benzetim modelleri olu?turulmu?, depolama ve rotalama politikalarının alternatif kombinasyonları geli?tirilerek bu benzetim modellerinde kullanılmı?tır. Elde edilen benzetim sonuçlarına göre, en küçük sipari? toplama süresini veren depolama ve rotalama politikası kombinasyonu belirlenmi?tir. Son olarak, benzetim sonuçları üzerinde bazı istatistiksel analiz metotları uygulanmı?tır Order picking activities play a critical role in supply chain management in terms of both production systems (supplying components to assembly operations) and distribution operations (meeting customer demands). Trends in customer orders reveal that orders are transformed from few-and-large orders to many-and-small ones. On the other hand, lead times of customer orders get consistently shorter. Because of these changes, companies need to adopt an effective and flexible order picking system in order to remain competitive in the market. Order picking affects both overall logistic operations and service level provided to customers. Additionally, order picking process constitutes more than half of the total warehousing cost. For these reasons, it is crucial for companies to design and perform an effective order picking process. The aim of this study is evaluating and improving of the order picking system so as to minimize the order retrieval time while increasing the picking efficiency. Order retrieval time can be defined as the time elapsed for the process of retrieving products from storage area to meet a specific customer demand. Besides the critical factors such as storage assignment decisions and routing methods, replenishment problem of the storage areas, which is rarely addressed in the previous studies, has been taken into consideration in this study. Replenishment of the empty storage locations has been conducted by using the (S, s) inventory policy. Thus, the order picking system was modeled as a dynamic system. A hypothetical distribution warehouse, based on the real life warehouse of a company specialized in production of fasteners, has been studied in order to improve the order picking performance. Alternative combinations of routing and storage policies have been developed. Moreover, different simulation models of the order picking process were constructed. In these models, proposed alternative storage and v routing policies were operated. According to the simulation results, the storage policy and routing policy combination which provides the shortest order retrieval time is determined. Finally, using simulation results, some statistical analysis methods have been implemented

Developing a Decision Support Tool for Increased Warehouse Picking Efficiency

Problem description: Warehousing is central in order to achieve a competitive supply chain, and considered essential for the success, or failure, of businesses today. In general, warehouses account for a large share of the company logistics costs. Consequently, there is a need for warehouses to operate smoother, faster and more accurate. Within warehousing, the most labor-intensive and costly warehouse operation is order picking, this is mainly due to the large amount of travelling involved. All articles included in this study agree that order picking account for at least 50 percent of warehouses' total operating costs. Warehouses thus carry great potential to justify the expenses they bring through reducing the time spent on activities that are not value adding. Purpose: The overall goal in this thesis is to provide guidance for how a warehouse can operate more efficient by improving its picking performance, which also includes reviewing the closely interlinked warehouse operations storage allocation and routing. Research questions: How can a decision support tool for reviewing the choices of storage allocation, order picking, and routing methods in manual warehouse operations be put together in a structured way? Which features should be considered in the decision support tool for choosing methods for improving warehouse operations? Methodology: The guidance for improved picking performance was framed into a decision support tool building on a thorough review and analysis of the research available in the area. A case study on picking efficiency was conducted in order to create a deep understanding for the issues and challenges that prevail in warehousing, and also to ensure that the final recommendations and the answers to the research questions have good support in academia. Once the tool was created, an illustrative example was used to demonstrate the use of the tool on a more detailed level and to test its comprehensibility and usability. Conclusions: In many areas, the resulting tool manages to provide unequivocal guidance for how to improve a warehouse’ picking operations. Multiple features are identified as important for the decision process; among those are demand skewness, seasonality among different SKUs, total demand variation and pick list size. Company objectives and priorities were also identified as a central feature due to the interrelatedness of the decisions connected to picking and their well-known tradeoffs. The research is however sometimes scarce, and further studies need to be carried-out in order to complement and level the strength of the tool.Problembeskrivning: Lagerverksamhet utgör en central del i att uppnå en konkurrenskraftig försörjningskedja och betraktas som direkt avgörande för ett företags framgång, eller utebliven sådan. Det är en dyr verksamhet, och en stor del av ett företags totala logistikkostnader kan hänvisas direkt till lagret. Följaktligen finns det ett behov för lager att prestera jämnare, snabbare och mer precist. Orderplockning är den tveklöst kostsammaste och mest resurskrävande lageraktiviteten. Den huvudsakliga anledningen är att orderplockning till stor del består av transporter mellan platser, vilket inte i sig tillför något värde och därmed enbart är resurskrävande. Alla vetenskapliga artiklar som är inkluderade i studien är eniga om att minst 50 procent av ett typiskt lagers driftkostnader kan härledas till orderplock. Lagret har därmed stor potential att rättfärdiga sina kostnader, genom att reducera den andel tid och resurser som läggs på icke värdeskapande aktiviteter. Syfte: Det övergripande målet med uppsatsen är att skapa vägledning för hur lager kan öka sin effektivitet genom att förbättra sina plockprocesser. Detta inkluderar även de närliggande beslutsområdena lagerplatsallokering och ruttplanering. Forskningsfrågor: Hur kan ett beslutsverktyg för att granska metodval för lagerplatsallokering, orderplockning och ruttplanering vid manuell lagerverksamhet sättas ihop på ett strukturerat sätt? Vilka egenskaper bör beaktas i ett beslutsverktyg för att välja metoder som förbättrar lagerverksamheten? Metod: Beslutsverktyget skapades utifrån en grundlig genomgång samt analys av den forskning som finns inom området. En fallstudie om effektivisering av plockhantering genomfördes med syftet att skapa en djupgående förståelse för de problem och utmaningar som förekommer i en lagerverksamhet, liksom att säkerställa att de slutgiltiga rekommendationerna och svaren på forskningsfrågorna var väl förankrade i akademin. När verktyget var skapat användes ett illustrativt exempel för att demonstrera dess användning på en detaljerad nivå, samt för att testa hur lätt det är att förstå och använda. Slutsats: Beslutsverktyget som skapats lyckas ge tydliga rekommendationer och vägledning inom många områden för hur ett lagers plockprocesser kan förbättras. Flera egenskaper identifieras som särskilt viktiga att beakta i beslutsprocessen; bland annat skevhet i efterfrågan, säsongsförknippad efterfrågan mellan olika lagerplatsenhet, total variation i efterfrågan samt längden på plocklistorna. Företags egna mål och prioriteringar identifieras också som centrala i beslutsverktyget eftersom alla beslut är tätt sammanvävda och generellt innebär ständiga kompromisser. Inom flera områden relaterade till plockhantering visade sig forskningen emellertid vara otillräcklig, och ytterligare studier krävs för att stärka beslutsverktyget

Performance Approximation and Design of Pick-and-Pass Order Picking Systems

In this paper, we discuss an approximation method based on G/G/m queuing network modeling using Whitt’s (1983) queuing network analyzer to analyze pick-and-pass order picking systems. The objective of this approximation method is to provide an instrument for obtaining rapid performance estimates (such as order lead time and station utilization) of the order picking system. The pick-and-pass system is decomposed into conveyor pieces and pick stations. Conveyor pieces have a constant processing time, whereas the service times at a pick station depend on the number of order lines in the order to be picked at the station, the storage policy at the station, and the working methods. Our approximation method appears to be sufficiently accurate for practical purposes. It can be used to rapidly evaluate the effects of the storage methods in pick stations, the number of order pickers at stations, the size of pick stations, the arrival process of customer orders, and the impact of batching and splitting orders on system performance.simulation;warehousing;order picking;queuing network;pick-and-pass

Hybrid order picking : A simulation model of a joint manual and autonomous order picking system

Order picking is a key process in supply chains and a determinant of business success in many industries. Order picking is still performed manually by human operators in most companies; however, there are also increasingly more technologies available to automate order picking processes or to support human order pickers. One concept that has not attracted much research attention so far is hybrid order picking where autonomous robots and human order pickers work together in warehouses within a shared workspace for a joint target. This study presents a simulation model that considers various system characteristics and parameters of hybrid order picking systems, such as picker blocking, to evaluate the performance of such systems. Our results show that hybrid order picking is generally capable of improving pure manual or automated order picking operations in terms of throughput and total costs. Based on the simulation results, promising future research potentials are discussed

Warehouse design and control: framework and literature review

In this paper we present a reference framework and a classification of warehouse design and control problems. Based on this framework, we review the existing literature on warehousing systems and indicate important gaps. In particular, we emphasize the need for design oriented studies, as opposed to the strong analysis oriented research on isolated subproblems that seems to be dominant in the current literature

Performance Approximation and Design of Pick-and-Pass Order Picking Systems

In this paper, we discuss an approximation method based on G/G/m queuing network modeling using Whitt’s (1983) queuing network analyzer to analyze pick-and-pass order picking systems. The objective of this approximation method is to provide an instrument for obt

Design and optimization of an explosive storage policy in internet fulfillment warehouses

This research investigates the warehousing operations of internet retailers. The primary physical process in internet retail is fulfillment, which typically involves a large internet fulfillment warehouse (IFW) that has been built and designed exclusively for online sales and an accompanying parcel delivery network. Based on observational studies of IFW operations at a leading internet retailer, the investigations find that traditional warehousing methods are being replaced by new methods which better leverage information technology and efficiently serve the new internet retail driven supply chain economy. Traditional methods assume a warehouse moves bulk volumes to retail points where the bulks get broken down into individual items and sold. But in internet retail all the middle elements of a supply chain are combined into the IFW. Specifically, six key structural differentiations between traditional and IFW operations are identified: (i) explosive storage policy (ii) very large number of beehive storage locations (iii) bins with commingled SKUs (iv) immediate order fulfillment (v) short picking routes with single unit picks and (vi) high transaction volumes with total digital control. In combination, these have the effect of organizing the entire IFW warehouse like a forward picking area. Several models to describe and control IFW operations are developed and optimized. For IFWs the primary performance metric is order fulfillment time, the interval between order receipt and shipment, with a target of less than four hours to allow for same day shipment. Central to achieving this objective is an explosive storage policy which is defined as: An incoming bulk SKU is exploded into E storage lots such that no lot contains more than 10% of the received quantity, the lots are then stored in E locations anywhere in the warehouse without preset restrictions. The explosion ratio Ψo is introduced that measures the dispersion density, and show that in a randomized storage warehouse Ψoo\u3e0.40. Specific research objectives that are accomplished: (i) Develope a descriptive and prescriptive model for the control of IFW product flows identifying control variables and parameters and their relationship to the fulfillment time performance objective, (ii) Use a simulation analysis and baseline or greedy storage and picking algorithms to confirm that fulfillment time is a convex function of E and sensitive to Ǩ, the pick list size. For an experimental problem the fulfillment time decrease by 7% and 16% for explosion ratios ranging between Ψo=0.1 and 0.8, confirming the benefits of an explosive strategy, (iii) Develope the Bin Weighted Order Fillability (BWOF) heuristic, a fast order picking algorithm which estimates the number of pending orders than can be filled from a specific bin location. For small problems (120 orders) the BWOF performes well against an optimal assignment. For 45 test problems the BWOF matches the optimal in 28 cases and within 10% in five cases. For the large simulation experimental problems the BWOF heuristic further reduces fulfillment time by 18% for Ǩ =13, 27% for Ǩ =15 and 39% for Ǩ =17. The best fulfillment times are achieved at Ψo=0.5, allowing for additional benefits from faster storage times and reduced storage costs

Optimization of storage and picking systems in warehouses

La croissance du commerce électronique exige une hausse des performances des systèmes d'entreposage, qui sont maintenant repensés pour faire face à un volume massif de demandes à être satisfait le plus rapidement possible. Le système manuel et le système à robots mobile (SRM) sont parmi les plus utilisés pour ces activités. Le premier est un système centré sur l'humain pour réaliser des opérations complexes que les robots actuels ne peuvent pas effectuer. Cependant, les nouvelles générations de robots autonomes mènent à un remplacement progressif par le dernier pour augmenter la productivité. Quel que soit le système utilisé, plusieurs problèmes interdépendants doivent être résolus pour avoir des processus de stockage et de prélèvement efficaces. Les problèmes de stockage concernent les décisions d'où stocker les produits dans l'entrepôt. Les problèmes de prélèvement incluent le regroupement des commandes à exécuter ensemble et les itinéraires que les cueilleurs et les robots doivent suivre pour récupérer les produits demandés. Dans le système manuel, ces problèmes sont traditionnellement résolus à l'aide de politiques simples que les préparateurs peuvent facilement suivre. Malgré l'utilisation de robots, la même stratégie de solution est répliquée aux problèmes équivalents trouvés dans le SRM. Dans cette recherche, nous étudions les problèmes de stockage et de prélèvement rencontrés lors de la conception du système manuel et du SRM. Nous développons des outils d'optimisation pour aider à la prise de décision pour mettre en place leurs processus, en améliorant les mesures de performance typiques de ces systèmes. Certains problèmes traditionnels sont résolus avec des techniques améliorées, tandis que d'autres sont intégrés pour être résolus ensemble au lieu d'optimiser chaque sous-système de manière indépendante. Nous considérons d'abord un système manuel avec un ensemble connu de commandes et intégrons les décisions de stockage et de routage. Le problème intégré et certaines variantes tenant compte des politiques de routage communes sont modélisés mathématiquement. Une métaheuristique générale de recherche de voisinage variable est présentée pour traiter des instances de taille réelle. Des expériences attestent de l'efficience de la métaheuristique proposée par rapport aux modèles exacts et aux politiques de stockage communes. Lorsque les demandes futures sont incertaines, il est courant d'utiliser une stratégie de zonage qui divise la zone de stockage en zones et attribue les produits les plus demandés aux meilleures zones. Les tailles des zones sont à déterminer. Généralement, des dimensions arbitraires sont choisies, mais elles ignorent les caractéristiques de l'entrepôt et des demandes. Nous abordons le problème de dimensionnement des zones pour déterminer quels facteurs sont pertinents pour choisir de meilleures tailles de zone. Les données générées à partir de simulations exhaustives sont utilisées pour trainer quatre modèles de régression d'apprentissage automatique - moindres carrés ordinaire, arbre de régression, forêt aléatoire et perceptron multicouche - afin de prédire les dimensions optimales des zones en fonction de l'ensemble de facteurs pertinents identifiés. Nous montrons que tous les modèles entraînés suggèrent des dimensions sur mesure des zones qui performent meilleur que les dimensions arbitraires couramment utilisées. Une autre approche pour résoudre les problèmes de stockage pour le système manuel et pour le SRM considère les corrélations entre les produits. L'idée est que les produits régulièrement demandés ensemble doivent être stockés près pour réduire les coûts de routage. Cette politique de stockage peut être modélisée comme une variante du problème d'affectation quadratique (PAQ). Le PAQ est un problème combinatoire traditionnel et l'un des plus difficiles à résoudre. Nous examinons les variantes les plus connues du PAQ et développons une puissante métaheuristique itérative de recherche tabou mémétique en parallèle capable de les résoudre. La métaheuristique proposée s'avère être parmi les plus performantes pour le PAQ et surpasse considérablement l'état de l'art pour ses variantes. Les SRM permettent de repositionner facilement les pods d'inventaire pendant les opérations, ce qui peut conduire à un processus de prélèvement plus économe en énergie. Nous intégrons les décisions de repositionnement des pods à l'attribution des commandes et à la sélection des pods à l'aide d'une stratégie de prélèvement par vague. Les pods sont réorganisés en tenant compte du moment et de l'endroit où ils devraient être demandés au futur. Nous résolvons ce problème en utilisant la programmation stochastique en tenant compte de l'incertitude sur les demandes futures et suggérons une matheuristique de recherche locale pour résoudre des instances de taille réelle. Nous montrons que notre schéma d'approximation moyenne de l'échantillon est efficace pour simuler les demandes futures puisque nos méthodes améliorent les solutions trouvées lorsque les vagues sont planifiées sans tenir compte de l'avenir. Cette thèse est structurée comme suit. Après un chapitre d'introduction, nous présentons une revue de la littérature sur le système manuel et le SRM, et les décisions communes prises pour mettre en place leurs processus de stockage et de prélèvement. Les quatre chapitres suivants détaillent les études pour le problème de stockage et de routage intégré, le problème de dimensionnement des zones, le PAQ et le problème de repositionnement de pod. Nos conclusions sont résumées dans le dernier chapitre.The rising of e-commerce is demanding an increase in the performance of warehousing systems, which are being redesigned to deal with a mass volume of demands to be fulfilled as fast as possible. The manual system and the robotic mobile fulfillment system (RMFS) are among the most commonly used for these activities. The former is a human-centered system that handles complex operations that current robots cannot perform. However, newer generations of autonomous robots are leading to a gradual replacement by the latter to increase productivity. Regardless of the system used, several interdependent problems have to be solved to have efficient storage and picking processes. Storage problems concern decisions on where to store products within the warehouse. Picking problems include the batching of orders to be fulfilled together and the routes the pickers and robots should follow to retrieve the products demanded. In the manual system, these problems are traditionally solved using simple policies that pickers can easily follow. Despite using robots, the same solution strategy is being replicated to the equivalent problems found in the RMFS. In this research, we investigate storage and picking problems faced when designing manual and RMFS warehouses. We develop optimization tools to help in the decision-making process to set up their processes and improve typical performance measures considered in these systems. Some classic problems are solved with improved techniques, while others are integrated to be solved together instead of optimizing each subsystem sequentially. We first consider a manual system with a known set of orders and integrate storage and routing decisions. The integrated problem and some variants considering common routing policies are modeled mathematically. A general variable neighborhood search metaheuristic is presented to deal with real-size instances. Computational experiments attest to the effectiveness of the metaheuristic proposed compared to the exact models and common storage policies. When future demands are uncertain, it is common to use a zoning strategy to divide the storage area into zones and assign the most-demanded products to the best zones. Zone sizes are to be determined. Commonly, arbitrary sizes are chosen, which ignore the characteristics of the warehouse and the demands. We approach the zone sizing problem to determine which factors are relevant to choosing better zone sizes. Data generated from exhaustive simulations are used to train four machine learning regression models - ordinary least squares, regression tree, random forest, and multilayer perceptron - to predict the optimal zone sizes given the set of relevant factors identified. We show that all trained models suggest tailor-made zone sizes with better picking performance than the arbitrary ones commonly used. Another approach to solving storage problems, both in the manual and RMFS, considers the correlations between products. The idea is that products constantly demanded together should be stored closer to reduce routing costs. This storage policy can be modeled as a quadratic assignment problem (QAP) variant. The QAP is a traditional combinatorial problem and one of the hardest to solve. We survey the most traditional QAP variants and develop a powerful parallel memetic iterated tabu search metaheuristic capable of solving them. The proposed metaheuristic is shown to be among the best performing ones for the QAP and significantly outperforms the state-of-the-art for its variants. The RMFS allows easy repositioning of inventory pods during operations that can lead to a more energy-efficient picking process. We integrate pod repositioning decisions with order assignment and pod selection using a wave picking strategy such that pods are parked after being requested considering when and where they are expected to be requested next. We solve this integrated problem using stochastic programming considering the uncertainty about future demands and suggest a local search matheuristic to solve real-size instances. We show that our sample average approximation scheme is effective to simulate future demands since our methods improve solutions found when waves are planned without considering the future demands. This thesis is structured as follows. After an introductory chapter, we present a literature review on the manual and RMFS, and common decisions made to set up their storage and picking processes. The next four chapters detail the studies for the integrated storage and routing problem, the zone sizing problem, the QAP, and the pod repositioning problem. Our findings are summarized in the last chapter