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  • 1. Material Handling Control System Software Extends Supply Chain Visibility BY SAL SPADA NOVEMBER 15, 2001 ARC INSIGHTS# 2001-051MD KEYWORDS: Material Handling SUMMARY: Optimization of the sourcing, manufacturing, and delivery of goods remains a viable opportunity for businesses to improve profitability. Consequently, a greater emphasis is on synchronization of the supply chain with customers and suppliers by improving the supply chain visibility. Material handling systems are the underlying infrastructure for execution in the supply chain. Consequently, these systems are under Material handling systems are pressure to deliver six-sigma performance. Designing a material han-the underlying infrastructure for dling system to achieve six-sigma can be a significant challenge as execution in the supply chain. many systems must be capable of functioning with dramatic swings in demand, reduction in staff, and a wide range of package sizes. ANALYSIS: Material handling systems have taken on greater importance because of the greater focus on supply chain visibility. Optimizing the supply chain provides many opportunities to improve profitability. Emphasizing the sourcing, manufacturing, and delivery of goods without creating the infrastructure that provides visibility throughout all tiers of the supply chain leads to the inability to execute. To be effective, extending supply chain visibility depends upon a greater reach of information on inventory in transit, work in process, and inventory in warehouses and distribution centers. Developing a set of met- rics for each element of the supply chain function is an absolute imperative in gauging the performance of the operation as a whole. An overall metric is Perfect Order Fulfill- ment, which depends on several key factors where products are manufactured to specification, delivered on time, undamaged, in the right quantity, with no unauthorized substitution, and billed correctly. Achieving six-sigma performance on Perfect Order Fulfillment forces companies to reach into every element of the business process at all phases of the operation. Material han- dling systems in the manufacturing, distribution centers, parcel handling, and third party logistics are considered key factors in achieving six-sigma performance. Specifi- cally, manufacturing plants are under pressure to improve operating effectiveness, which is measured by factors such as production quality, turnaround time, capability to ENTERPRISE AND AUTOMATION STRATEGIES FOR INDUSTRY EXECUTIVES
  • 2. ARC Insights, Page 2 customize, and responsiveness to smaller orders. Over the last ten years, manufacturers have infused more automation in the factories to implement agile manufacturing tech- niques and implement electronic design techniques. Manufacturers have leveraged automated material handling systems to route work in process between each stage of the manufacturing operation to improve operating effectiveness. Automated material han- dling solutions on the factory floor offer the ability to extend the reach of the supply chain. Material Handling Systems under Pressure Material handling systems are under pressure to deliver six-sigma performance. Design- ing a material handling system to achieve this, however, can be a significant challenge, as many systems must be capable of functioning with dramatic swings in demand, re- duction in staff, and a wide range of package sizes. This translates into more intelligent and agile material handling systems. Without the underlying infrastructure of intelli- gent, information rich material handling system solution, a higher-level business system such as a Supply Chain Execution (SCE) system, Collaborative Production Management Solution (CPM), and Warehouse Management Systems (WMS) cannot accurately make decisions to achieve the goals of the business. SCE, CPM and WMS are an integral part of the operational planning and scheduling while highly Enterprise Systems dependent upon the capabili- ties of the MCS software Warehouse solutions. As a result, Mate-Database Management Material Handling Control System rial Handling Control System System (MCS) software must be con- sidered a part of a larger Sorters Transport Tracking Robotics group of Supply Chain Man- Systems Sensors agement (SCM) solutions or Material Handling Control System Software Architectures manufacturing solutions. Uniform Interfaces Provided to a Broad Range of Equipment MCS software provides a uniform interface to broad range of material handling equip- ment from numerous equipment suppliers. These systems provide shop floor personnel with instructions on what to do next and often direct the manner in which a job is com- pleted. For managers, these systems track work-in-process, provide real-time visibility of what is currently happening, and produce a historical record or audit trail. End users are seeking to reduce the training time of operators, reduce the maintenance costs, and minimize the transport time of individual items being routed with MCS software solu- tions. MCS software provides at minimum the following distinct functions: © 2001 • ARC Advisory Group • 3 Allied Drive • Dedham, MA 02026 USA • 781-471-1000 • USA • UK • Germany • Japan • India
  • 3. ARC Insights, Page 3• Equipment Manager: Integrates the automated material handling subsystems into a single efficient transport system.• Visualization: Graphical interface for system monitoring and a control tool to over- ride routings.• Maintenance: Provides an early warning maintenance system as well as managing scheduled maintenance activities• Routing: Material flow manager optimizing the transport of parcels, packages, and inventory for a system. In manufacturing or assembly operations the application routes work in process throughout the production process.• Exception Handling: A uniform error handling procedure is employed across all subsystems regardless of the manufacturer.MCS software solutions are found in material handling systems located in manufactur-ing plants, distribution centers, warehouses, and parcel handling centers. Managing theequipment in these facilities requires sophisticated software that is capable of communi-cating directly to conveyors, sortation equipment, Automatic Guided Vehicles, and,Automated Storage & Retrieval Systems, and robots.MCS Raises Material Handling Solution EfficiencyA key metric for a material handling solution is maximum throughput, which is depend-ent on consistent, reliable material movement using the most efficient path. Forautomated warehouses and manufacturing plants, ensuring a high level of efficiency re-volves around selecting and integrating a proven MCS software solution. MCS softwarecan radically improve material handling implementation efficiencies as operators remainwell informed about maintenance issues, congested stations, and rapidly identify areasof poor performance. A basic MCS solution increases efficiency in receiving, routingwork in process, put-away, picking, packing, and shipping. It allows higher-level WMSor CPM software to accurately track inventory or work in process in a manufacturingfacility. The control capabilities of MCS software provide data gathering for later analy-sis and reporting to facilitate continuing operational efficiencies.MCS Software Solutions Seek MaturityThe market for MCS software is relatively immature in terms of functionality. Most ma-terial handling suppliers have several variants of MCS software for specific niche marketsegments. Currently, every effort is being made to incorporate a standard look and feelbetween suppliers or even systems from one application domain to the next. A largepercentage of the MCS software installed at different sites is custom designed for the enduser according to their specifications. It is rare that a material-handling supplier canquote a project based on off the shelf component software solutions, since many end us- © 2001 • ARC Advisory Group • 3 Allied Drive • Dedham, MA 02026 USA • 781-471-1000 • USA • UK • Germany • Japan • India
  • 4. ARC Insights, Page 4 ers are demanding customized software solutions Company Software Applications that can give them a competitive advantage. De- Automotion Conveyors Automotion Sorter Controller spite the lack of consistency between MCS Brooks Automation ClassMCS, OpenMTS solutions, there is a minimum set of functionality Dexion Material Handling Conveyor expected in these types of systems. A material han- System Software dling application is a complex system composed of Durr Basis, EMOS-SM numerous subsystems. To efficiently manage these Eskay (Daifuku) Real-Time System subsystems requires a plant wide monitoring and control systems, MCS. FKI Logistex BOSS, Answer Flexlink Dynamic Assembly Systems, Assembly Flow Management Supply Chain Visibility SCM software solutions, internal business practices, HK Systems IristaAutomate and tightly managed trading partner relationships Jervis B. Webb PC/AIM, BASIS, Webb-View, Reel-View allow a company to serve customers more effi- ciently by organizing and coordinating internal and Paragon Technologies Gantry Sorter, Command Systems Software partner activities. Manufacturers, however, are in PRI Automation the middle of this tremendous effort to improve profitability. Intelligent and information enabled Siemens Dematic Sorter Control System, Pick Director, Rapid Sort, Rapid material handling systems are the foundation be- Route hind achieving these goals. Optimal performance Swiss Log Automation Manager, Auto- depends on seamless communication from top to mation Visualizer bottom of the business, enabling rapid response toMaterial Handling Control System Software Solutions equipment repairs and autonomous, information rich subsystems that facilitate collaboration throughout all tiers of the business. RECOMMENDATIONS: • End users should seek to information enable plant with greater emphasis on Material Handling Control Systems. • Strive to create industry standard interfaces between Material Handling Control Sys- tem the higher level business systems. For further information, contact your account manager or the author at Recommended circulation: All MAS-D clients. © 2001 • ARC Advisory Group • 3 Allied Drive • Dedham, MA 02026 USA • 781-471-1000 • USA • UK • Germany • Japan • India