Many companies spend a large amount of staff time and money looking for ways to improve processes, reduce the costs of operations and improve the quality of customer service.
One area that is often overlooked is the storage and retrieval of parts—parts used in manufacturing and maintenance operations, as well as finished parts that are shipped to customers. The placement of parts and other Stock Keeping Units (SKUs) in a facility is a critical consideration in improving the overall productivity and efficiency of operations. Most companies don't take the time to effectively plan storage and retrieval operations, and often don't use the most effective storage media for those operations. In fact, the space utilization rate in most companies is rarely over 50%, meaning that improvements can be easily made by relocating parts using space within the existing facility. The key to success is to balance available space with productivity needs.
Benefits of Slotting
One way to achieve this balance and improve the efficiency of storage and retrieval operations is to use a technique called slotting. Slotting is the assignment of items to a particular location in a storage and retrieval system to maximize system capacity and improve the efficiency of the operation. In many types of businesses, slotting has improved space utilization, reduced parts handling, increased productivity, improved inventory and picking accuracy, and improved system ergonomics. All of these improvements directly influence bottom line performance.
Slotting Goals and Objectives
There are two main goals of slotting. One is to have the fastest moving items available in the most ergonomic position available. The second goal is to have items that are often picked for he same order physically next to each other.
You evaluate your storage equipment and band them based on accessibility. All picking done with a reach between operator's knees and shoulders is called the Golden Zone and should contain 80% of the fastest moving items. Likewise, you can take the fastest items from a zone and have multiple positions within the storage device to assure quick access.
Having items that always or very often go together in an order is the next goal of slotting. Having these ‘married' items next to each other ensures simple and accurate picking processes as well as faster order completion times.
The slotting technique stores parts in quantities that make sense for the type of distribution that is required. For example, these quantities could include eaches, cases, pallets, kits, interpaks or combinations of these quantities. Storing parts in their appropriate distribution quantities significantly reduces part handling time and, consequently, the costs associated with unnecessary handling.
Slotting can also increase operator productivity by reducing walk and search time and by making fast moving parts more accessible than slower movers. Some companies add space to their operations when business picks up, but often don't consider the best placement of items within the system to reflect the change in business. Sometimes this results in faster moving items being stored in more difficult to access areas than older, slower moving items.
By taking the time to categorize parts and group them by families or common usage, the time saved in retrieval will be significant and productivity will improve. Slotting matches the part size to the location size and uses the "best of breed" storage medium to hold the parts. This helps reduce bending and climbing by allowing the storage of faster moving items in more easily operator accessible locations, thus utilizing the Golden Zone mentioned earlier.
The weight and shape of parts also has an influence on picking throughput, and the efficient system balances high and low retrieval activity with the weight of the part. By slotting faster moving heavy or odd shaped parts in an ergonomic location within operations, worker fatigue can be reduced resulting in improved picking throughput and increased accuracy of completed orders.
Today, with the hardware and software available for storage and retrieval applications, there is no excuse for poor picking accuracy. When parts are organized and grouped by families or usage, picking accuracy can improve up to 99.9%. Improved picking accuracy leads to more accurate inventory levels.
Where Does Slotting Fit?
Rack, shelving, drawer systems, flow rack, horizontal and vertical carousels and Vertical Lift Modules (VLMs) are all candidates for slotting. Most operations require multiple types of storage systems to effectively store parts.
When is slotting appropriate?
Slotting solves many storage and retrieval problems, and it is particularly effective when any of the following conditions exist: when operators can't meet peak requirements, when more storage space must be created, when there is a need to improve customer responsiveness, when too many pickers are "tripping" over each other, when the business expands or grows, when it's necessary to improve picking accuracy and increase operator productivity.
Slotting is working smarter instead of harder. Manufacturing, stockrooms, tool and die storage, maintenance and repair operations, point-of-use and service operations can use slotting to their advantage for smoother, easier transactions. In wholesale and retail distribution, any time high numbers of SKUs are shipped, when increasing or changing SKUs are occurring, or when handling those peak-season fluctuations, slotting can have real advantages to those who would employ the methods.
How to Make Slotting Work
The way to make slotting work is to analyze your company's inventory, figure out how and to whom product is distributed, manufactured or serviced. The first step is to collect inventory data. Most companies have two customer bases. The first is the internal customer base. This customer base includes manufacturing, distribution and shipping personnel. This base receives its "products" directly from the storage and retrieval devices and methods.
The other customer base is external. These customers may receive products directly, through dealers, by mail order, e-commerce or a combination of these methods. Next, define customer expectations. How do customers, both internal and external, expect to receive products? In pallets, cases or eaches? Do they expect kits, and if so are the kits simple, complex, large or small? In what time frame do they expect products? Hourly, daily or weekly? Is there a better way to pick items to meet the company's business objectives?
The quantitative part of this data collection operation includes listing part numbers and descriptions, part sizes and weights, stock quantity, reorder point and reorder quantity, the average quantity of the individual product picked per cycle, a list of products that are used or picked together, which products move faster because of seasonal factors and product/process throughput and flow.
Once this information has been gathered, it can be used to categorize the inventory. Assign products into categories of fast, medium and slow movement, small, medium and large sizes, light or heavy, conveyable or not conveyable and the manner in which they are packaged.
After the process of data gathering and categorization is completed, the information necessary for creating a slotting plan is readily at hand. Assign someone the responsibility of developing a plan for the data and implementing the plan after review. There are a number of industry consultants who can help with this process.
Each slotting plan is unique because it reflects the different needs of the individual organization for which it is developed. Remember also that slotting can be an ongoing process as a business grows and changes, becoming partly an art within a science. Developing a slotting plan takes time, reliable information, good communication and a thorough understanding of the company's business objectives. The perfect slotting plan is a flexible one prepared to take change and growth into consideration. When the art of a slotting plan is flexible enough to respond to changing business needs, the science of slotting can be harnessed to achieve increased productivity and order accuracy, whether they are driven by seasonal concerns or other factors that influence your operation.