Copperberg’s editor Adrian Cirlig and content writer Radiana Pit discuss the importance of warehousing and your logistical networking and how ecommerce is changing what was once a straight-forward channel. 

Getting the right parts on time has always been critical for field service technicians, and for that purpose, warehouse and logistics design is essential. But many industry players are struggling to meet customer demands in the era of digital commerce. New delivery standards may require significant investments in staffing, facilities, and technology—and such an endeavor is not always an option for most businesses.

The Importance of Service Logistics

The rapid development of e-commerce has taken many organizations by surprise. Now, logistics companies are largely unprepared to adapt their operations to meet expectations in terms of quality, capacity, and speed.  

However, there is a solution to meeting delivery expectations at the lowest cost possible: optimal network and warehouse design. 

Logistics network and warehouse design is mainly concerned with delivering goods to customers and satisfying their needs with limited resources. This is why coming up with an optimal design holds great strategic value. But devising an optimal model is no easy feat, especially since most models stop short at minimizing costs. However, logistics professionals aim at optimizing their networks in a way that maximizes not only profit but also speed and sustainability. In order to achieve such objectives, comprehensive designs must take into account the number, location, role, and size of your facilities, which plant/vendor should produce which product, the raw materials and finished products that flow between facilities, and more. 

 

Location—the key issue in facilitating optimal design 

Determining the right number and size of your warehouses and/or plants is challenging enough, but getting the location wrong can be extremely detrimental. 

However, the secret to getting the location right is to think of it as the only way to close the gap between your company and your customers. The closer the location is to your clients, the faster your goods will be delivered—and that's what today's impatient society expects from you. 

So, start your design process by considering your location objectives and then identify the key factors that can make or break your network. 

 

So, what makes a warehouse great? 

 According to Rudolf Leuschner, Associate Professor at Rutgers Business School, what makes a warehouse great is: 

• Speed or the ability to ship out as much product as possible by ensuring the shortest distance between the product and the shipping dock; 
• Redundancy, which consists of multiple checks built into your distribution system to ensure that the right products are delivered to your customers; 
• Productivity or the ability to push out as much product as possible out of your distribution network. 

With these goals in mind, you can create a seamless warehouse flow process that consists of the following essential steps: 

Unloading → Storing → Picking → Packing → Staging → Loading  

Each step should be accurately timed with the help of a reliable warehouse management system. 

But beyond warehouse management software, you should also think FAST. If you're not already familiar with it, the FAST concept is a layout design solution that will help you to ensure that your locations are close enough to each other to enable seamless workflows. However, placing your activity-locations too closely can clutter your processes and result in highly inefficient outcomes. 

So, when it comes to FAST, you should focus on: 

• Flow to ensure a logical sequence of operations within your warehouse based on the location of each of your activities; 
• Accessibility to be able to receive and issue products in pallets, batches, or truckloads; 
• Space to make optimum use of the cubic capacity within your warehouse; 
• Throughput to reduce inventory risks such as bulk, security, compatibility, and more. 

These best practices for warehouse design will definitely help you come up with a proper layout that enables the rapid and seamless handling of products. But when it comes to network design, what are the most important aspects that ensure perfect order and superior performance? 

In other words, what makes a logistics network great? 

According to Edward Frazelle, President and CEO at RightChain Incorporated, an optimal network design/redesign process should consist of the following 10 steps: 

1. Evaluate your current network 
2. Design and populate your network optimization database;
3. Create network design alternatives, such as more or fewer hierarchies, multi-commodity flows, pooling opportunities, merge-in-transit, direct shipping, cross docking, and supply-flow optimization concepts; 
4. Develop your network optimization model; 
5. Choose the right network optimization tool; 
6. Implement your network model in the chosen tool; 
7. Consider alternative network designs; 
8. “Practicalize” recommended network structures; 
9. Compute reconfiguration costs; 
10. Make go/no-go decisions. 

To make the most out of this process, you should engage all stakeholders so that everyone is on the same page when you decide to jump-start your design initiatives. You should also enlist your stakeholders' help when looking for alternative network solutions, modeling transportation, comparing services and costs, and analyzing risks. 

Combining the efforts of those involved with data insights will help you accurately review model outputs and look at your options from a fresh perspective. 

Creating the perfect logistics network 

It goes without saying, but creating the perfect logistics network takes time and effort. However, you can set yourself up for success by aligning your logistics network with your business model and focusing on answering the following questions in a way that makes the most sense for your company: 

• How will a more responsive network enable growth? 
• Will network investments lower operating costs? 
• If operating costs increase, will the sales volume warrant the investment? 

By taking your time to reach the right conclusions, you will be able to find the ideal strategy to derive the greatest business value from your design initiatives. 

Last but not least, you will also need accurate data to kick-start your initiative. So, before you start designing or redesigning your network, list all of your products, stock points and sources regarding customer locations, set customer service goals, order processing costs and patterns by frequency, size, season, and content, and establish transportation rates and warehousing expenses. 

Are you ready to kick-start the design process? 

Although your old logistics network design might still be reliable, over time, it will become fragmented. This usually happens because territories change and ordering patterns alternate, which causes the network to lose its efficiency. 

So, it's vital for your company to review your network periodically and ensure maximum service in the most cost-efficient manner.

---

Further Reading: 

• Read more articles by Adrian Cirlig @ https://www.fieldservicenews.com/adrian+cirlig
• Read more about spare parts and logistics in service @ https://www.fieldservicenews.com/Spare+parts+and+logistics
• Read Edward Frazelle's article on an optimal network re-design/design process @ https://www.mhlnews.com/global-supply chain/article/22039647/how-to-design-a-logistics-network-in-10-steps
• Read Rudolf Leuschner's article on what makes the perfect warehouse @ https://www.coursera.org/lecture/supply-chain-logistics/how-much-inventory-do-we-need-eJIeU
• Read more about FAST from the Logistics Bureau @ https://www.logisticsbureau.com/warehouse-design-key-factors-to-consider/
• Read more about Copperberg and their events @ https://www.copperberg.com/field-service/

Additive Manufacturing (AM) is on the front line of the unfolding industrial revolution. This string of rapid prototyping technologies is replacing conventional production, and consequently, it is poised to generate substantial economic revenue by 2035—$196.8 billion. Adrian Cirlig and Teodora Gaici explain more...

The future is certainly bright, but so is the present. On any given day, manufacturers can turn to AM technology to facilitate the production of individually customized products at relatively low costs, reshape the design process, and consolidate their supply chains. 

AM will remain a particularly active architect of customer-driven design, virtual inventory, and rapid iterationsfor new product development. Yet it’s not all roses; the lack of quality consistency may slow production runs to a trickle. 

In consequence, is AM both the cure and the culprit of innovation volatility? Industry experts seem undecided in the matter as this paper from the Rand Corporation outlines. 

 

Additive Manufacturing: A Magic Bullet for Field Service Logistics? 

AM is, after all, a disruptive technology—one that comes with a learning curve. Many top-tier leaders have justifiably gauged the trajectory of additive technology, and when they sensed it had promise, they gingerly lunged for it. 

Through the use of AM technologies,anyone can manufacture products without any required tooling for production. That’s right—traditional molding techniques or large machines that have yet to be deftly transported will no longer impede manufacturing performance. Simply put, this set of powerful AM machines has the ability to fabricate a product from a digital geometry representation. Once they accurately replicate computer-aided design drawings, AM tools directly transform three-dimensional structures into functional physical prototypes and, more recently, ready-for-use products—all that in just a matter of minutes. The physical parts are built out of plastics, polymers, metals, ceramics, stainless steel, or other types of material by using a layer-by-layer printing process. A vast majority of modern AM machines print with multiple materials simultaneously and allow the development of mixed-material products.

"Manufacturers must have a plan for everything—how, when, and where they design and manufacture products rank top of the list..."

Organisations with a strong innovative culture recognize the need to facilitate on-demand production, and as it turns out, they’re growing faster and increasingly outpace their competitors.

Innovation, however, is rarely linear. In most cases, it’s a progressive affair that disrupts practically every aspect of the business

Manufacturers must have a plan for everything—how, when, and where they design and manufacture products rank top of the list. AM is already distorting modern-day manufacturers’ long-planned reality by encouraging them to rethink every design-to-fabrication procedure and go well beyond traditional manufacturing methods. Those who are up to the challenge will become the leading innovators in their market.

 

Additive Opportunities for the Taking 

The revolutionary AM technology is becoming commonplace one layer at a time. 

This significant surge in popularity may be due to the proposed benefits that are in visible contrast with those provided by conventional manufacturing operations. 

Milling, for example, can produce a large amount of unnecessary material waste. Distinct in nature, additive processes have become a statement of sustainability—both economically and environmentally. It is touted that AM technology reduces energy consumption, facilitates dematerialisation, and improves resource efficiency by using waste as an input to construct equitably personalised products in a cost-effective manner.

This type of manufacturing process also attempts to minimise the need for packaging, transportation, and storage. More than that, prototyping and building a high-value product from geometrically complex data in-house can also significantly reduce shipping costs and shorten supply chains.

Since AM machines offer complete (and highly flexible) design freedom, they allow early customer involvement in the product development process. This customer-driven design procedure helps manufacturers respond to individually customised demand wherever needed, revise and conduct timely design changes, and reduce time-to-market. Above all, manufacturers are empowered to forge direct-to-consumer relationships and prolong the lifetime value of a specific object.

"With large-scale printers being well underway, Additive Manufacturing technology will steadily extend its capabilities..."

It’s impressive, but that’s just barely scratching the surface. AM is an advocate of product differentiation—at scale!—and industry experts can take full advantage of this technology to mass-produce custom-fit objects without paying a steep price for additional workers or tooling. Manufacturing in large volumes will, in fact, reduce the cost per unit, minimise the total cost of ownership, and drive greater growth.

At the moment, AM machines can mainly print tiny (yet rather complex) items; they can briskly produce fully-functional parts in just a single production step and without the need for assembly lines. With large-scale printers being well underway, AM technology will steadily extend its capabilities to open up innovative business models across the industry.

 

Additive Manufacturing Technology Is Ripe for Investment, But the Caveats Remain 

It’s in the cards: AM tools will offer unlimited design-to-fabrication opportunities for modern-day manufacturers. The vast majority of these professionals may inevitably face certain drawbacks that can’t (and most probably won’t!) go unnoticed.

Quality consistency is one of the main stumbling blocks.

Every manufacturer aims to develop consistent parts and ensure repeatable quality levels throughout their production lines. Yet no two items are exactly the same. Given that AM machines can produce parts as small as 500 nanometers, the differences may be slim or less obvious; but they exist, and a single inconsistent subset that is left unaddressed could put the brakes on the production line.

All the materials used for crafting AM-produced components should also be processed within the required quality standards and specifications, or else they might prevent objects from being recycled

"Many manufacturing and field service professionals haven’t gained an in-depth understanding of Additive Manufacturing techniques yet, let alone hands-on experience.."

The knowledge gap is another considerable barrier to the adoption of AM technology. As this study warns “[the] knowledge of AM in the industry exists in pockets.” Many manufacturing and field service professionals haven’t gained an in-depth understanding of AM techniques yet, let alone hands-on experience.

Amid global economic unrest, the lack of know-how may drive economic insecurity and hamper technology adoption.

 

Route Around the Gaps and Fortify Additive Manufacturing Innovation 

An AM-produced component may be a sure bet for unprecedented manufacturing gains. That is, of course, if manufacturers do not band-aid the inevitable caveats that eagerly come with every disruptive technology. /p>

As AM technology advances, the trick is to promptly address each limitation or potential risk and transform every temporary hiccup into an opportunity for modernisng manufacturing lines.

Capturing AM’s transformative potential is crucial for manufacturers who want to advance customer-led product development and freely reach all their revenue growth targets. 

---

Further Reading: 

Adrian is the Editor for a series of key industry events with Swedish Conference Producer, Copperberg. 

• Find out more about his forthcoming event the Field Service Forum @ https://www.copperberg.com/fieldserviceforum/

---