Real Lean Transformation

Load Levelling - the first step towards lean warehouse operations

Warehouse productivity improvements of up to 20% can be brought about by applying load levelling principles to workload planning.

The core requirements demanded of a warehouse operation by its customers are for material receipts from external vendors, material transfers to and from on-site customer business units, and shipments to corporate hub sites. Each of these core material movement types (receipting, transfers and shipments) is vulnerable to highly variable daily workloads. High variability in workload levels gives rise to high variability in staff utilisation levels. The result is frequent, but sporadic, periods of warehouse staff under-utilisation. Periods of over-utilisation of warehouse staff rarely occur because manufacturing line stoppages for material shortage reasons are not tolerated in modern life science manufacturing. Warehouses are staffed to provide sufficient capacity to absorb peak demand levels.  

The motivation to increase warehouse productivity can come from a number of sources. The most frequent drivers are: 

  1. Business-wide cost reduction pressures
  2. Operational requirements to absorb increases in manufacturing volumes

As a first step towards leaning a warehouse operation, load levelling across short periods can yield staff productivity gains of up to 20%. Figure 1 shows a typical profile of staff loading over a 10-day period. Total daily workload comprises material receipts, transfers, shipments and non-core work (e.g. waste recycling activity). In this example January 14th (14/1) has the highest workload of the period at 51 hours. Average required loading across the period is 41 hours.

Staff Requirements before Level loading

Fig 1: Staff Requirements before Level Loading

The application of load levelling to this environment was achieved by re-scheduling some non-core activities (e.g. waste recycling, stock counting) and material receipting activity to the next working day. The same total amount of work was completed within the 10-day period. Figure 2 graphically depicts the levelled load, and the resultant productivity improvement of 20%.

Staff Requirements after Level Loading

Fig 2: Staff Requirements after Level Loading

Load levelling is most effectively implemented in a warehouse environment by training the warehouse team to manually plan for levelled workload totals in rolling, short-interval (e.g. 3-day) periods. Key design features of such an implementation include: 
  1. Visual planning, using a customised magnetic planning board (e.g. Figure 3), rather than by calculation. Low technology, high visibility planning is more effective in a time-restricted group setting than software-dependent, individualistic and mathematical planning.
  2. Planning spaces, which represent available staff time to do work, proportional in size to each of the different types of work to be carried out.

Load Levelling Board Example

Fig 3: Load Levelling Board Example

This Opinion was written by Ger Conolin, Senior Consultant with BSM. If you would like further information on  Level Loading please send an e-mail to Ger.

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