The document discusses five ways to drive efficiency in warehouse operations through increased agility. It recommends maximizing the capabilities of warehouse management systems, using agile material handling equipment that can be easily reconfigured, capturing cube and weight data for all stock keeping units, implementing slotting to optimize storage locations, and effective yard management through integration and focus on cycle times and fill rates. The overall goal is for distribution centers to adopt flexible processes and technologies that allow them to remain agile and adapt to changing business needs.

1. 5 Ways to Drive the Most Efficiency from Your Warehousing Operation Drew Forte Director Supply Chain Improvement

2. Agility in Logistics Agility has emerged as a key theme in supply chain execution… |

3. Agile Execution | “ Everybody’s got plans … until they get hit.” -Mike Tyson

4. Agility in Logistics Hits to the plan: Supply disruptions Port congestion Weather events Customs delays Inland delays Demand variation SKU proliferation Changing sizes and characteristics of items being handled M&A Increased multi channel commerce High fuel costs |

5. Agility in Logistics Keys to surviving a hit: Visibility of the event Broad impact assessment Rapid re-planning Effective execution |

6. Warehouse Strategy – WHY? | The top pressure companies face is to “do more with less”. |

7. Warehouse Strategy – WHAT? | Agility is the most sought-after distribution goal… Top Actions Logistics Executives Are Taking in Distribution: |

8. Warehouse Strategy – HOW? | First Process, then Software, then MHE |

9. Five Ways… | Get 110% out of your WMS! Agile Material Handling Equipment Capture cube and weight of every SKU! (6 reasons why) Implement Slotting & Solve the Rubik’s Cube in Your DC Yard Management – Why Most Companies Miss the Mark 5 Ways to Drive the Most Efficiency from Your Warehousing Operation |

10. Over-customization of WMS in the 1990’s has left many companies with legacy applications that no longer meet their needs New generation of WMS features Service Oriented Architecture (SOA) SOA allows for configuration of software while still making upgrades practical Get 110% out of your WMS! 1 |

11. Get 110% out of your WMS! | © AberdeenGroup 2007 1 |

12. Get 110% out of your WMS! | Source: AberdeenGroup, August, 2007 Best in Class companies are about 65% more likely to practice zone picking and batch picking. 1 Advanced Pick Methodologies… Waveless Picking…the next frontier? |

13. Get 110% out of your WMS! | Source: AberdeenGroup, August, 2007 1 Advanced Replenishment Methodologies… |

14. Technology such as photo-cell accumulation allows more sizes and weights of SKUs to be conveyed Motorized roller conveyor makes system reconfiguration easier Image courtesy of FKI Logistex Image courtesy of Dematic Agile Material Handling Equipment 2 Image courtesy of conveyor-parts.com |

15. Pick to light vendors are making their products easier to re-profile Image courtesy of Reddwerks Image courtesy of Lightning Pick Image courtesy of Bastian Material Handling Agile Material Handling Equipment 2 |

16. Pick modules with bays that can be easily reconfigured to accommodate carton flow, pallet flow, and static shelving Agile Material Handling Equipment 2 |

17. Even highly engineered equipment like carousels have become more agile and flexible Vertical carousels are more forgiving of out-of-balance situations, allowing a greater mix of SKUs to be stored Improved controls software allows pods of horizontal carousels to be re-configured electronically Image courtesy of Diamond Phoenix Image courtesy of Remstar Agile Material Handling Equipment 2 |

18. Solutions like Kiva’s are becoming more attractive to companies that need ultra high pick rates but don’t want to bolt anything down. Image courtesy of Kiva Agile Material Handling Equipment 2 |

19. Sizing structural components to accommodate vertical expansion Using simulation tools to project future capacity needs and design accordingly Working closely with architects on ceiling height and column spacing to allow for maximum storage Agile Material Handling Equipment 2 |

20. Real-time visibility of order fulfillment operations through WCS, dashboards Ability to rapidly re-deploy labor to high-volume areas Task and labor management to assess impact of events and execute Image courtesy of Blue Sky Logistics Agile Material Handling Equipment 2 |

21. Speech-based warehousing – not just for picking anymore Multi-modal devices allow for broader process application Image courtesy of Voxware Agile Material Handling Equipment 2 “ The voice system is almost as fast [as our carousel system], but, dollar-for-dollar, it's the best value for the type of picking that we do.” — a Logistics Manager for a large retail distributor |

22. Six Processes That Are Enabled By Cubing: Slotting Pick-to-shipper Expedited manifesting Check weighing Directed Put-Away Replenishment Image courtesy of Quantronix Capture cube and weight of every SKU! 3 |

23. | Source: AberdeenGroup, August, 2007 Keys to Effective Slotting: Implement Slotting 4 |

24. Blended Demand Forecasting: | Source: AberdeenGroup, August, 2007 Implement Slotting 4 | Source: AberdeenGroup, August, 2007

25. Multi-Variable Placement Rules | Implement Slotting 4 | Source: AberdeenGroup, August, 2007

26. Frequency Matters! | Implement Slotting 4 | Source: AberdeenGroup, August, 2007

27. Yard Management 5 The real savings? Cycle times and fill rate. Source: AberdeenGroup, August, 2007 | |

28. Integration – the key to value. | Yard Management 5 Source: AberdeenGroup, August, 2007 |

29. In Summary… Don’t pour concrete – adopt processes and technologies that will allow your distribution center to remain agile and meet the challenges of today’s business environment. | Source: AberdeenGroup, December, 2006 |

30. Thank You! Drew Forte Director Supply Chain Improvement, FORTE [email_address]