Strengthening your supply chain one link at a time.
From a military perspective, materiel readiness means providing the right equipment, materiel, and capabilities to ensure our service members’ ability to fight and win. Unfortunately, DoD warehouses can experience High Occupancy and Low Density in the storage systems due to drivers such as changing missions and profiles over time, as well as a lack of funding to install proper storage aids and to re-warehouse products to match the mission profile. Thus, the storage media selection does not meet its goal. By underutilizing the space, readiness can decline, as well as effectiveness and efficiency.
The space problem can present itself as there are very few open storage locations to store new receipts, known as high location “Occupancy”. However, the cube in the locations can be quite low, known as low cube “Density.” As a result, the warehouse is storing excess air. When the warehouse operates in this paradigm, items will be stored in the first available storage location regardless of whether it is the right fit for the product based on cube and velocity, which exacerbates the space challenge.
Like private sector warehouses, DoD warehouse inventory profiles are often complex, which increases the challenge when designing and implementing an optimal storage system. There are many different types of items to store and criteria to consider: big, small, valuable, pilferable, controlled, temperature controlled, classified, etc. Items can even be from more than one category which adds additional complexity.
The goal is to improve readiness by improving storage utilization. To achieve this goal, we will walk through a simple approach similar to treating a patient: Assess / Observe, Diagnosis, Plan, Implement, and Evaluate.
Assess / Observe
During this step, one tries to identify the problem or problems through objective and/or subjective means. Examples of subjective problems to look for during a warehouse tour that typically indicate storage utilization opportunities:
In addition to subjective means of problem identification, using data to identify problems objectively is equally as important. Collecting data, validating data, and identifying/resolving abnormalities in the data are key. The data must be accurate, consistent, and clear. Examples of problems one may uncover in the data include:
Additionally, the data can be used in later steps to quantify the size of the opportunity in future steps.
Diagnosis
Diagnosis, like treating a patient, is when one determines what is causing the symptom of storing air. During this step, one will determine the best path forward by identifying which current storage practices can be resolved, ranking them in descending order of opportunity from greatest to least impact. This ranking should also consider both risk and cost. When this step is complete, a vision of the end state with better storage utilization should be defined.
Plan
The objective of the plan step is to create a plan to convert the vision to reality. It is essential to include stakeholders in the development of the plan to reduce the likelihood that something will be missed and to increase stakeholders’ buy-in to the plan. The plan should include a path to get a warehouse to a healthy state and to remain healthy. Having an implementation plan increases the likelihood of success. The plan is a document outlining steps to achieve the desired goal of improved storage utilization which includes:
Implement
Once the plan is finalized, implementation can begin. This is where a plan becomes reality. Communication to the organization regarding the implementation plan upfront, as well as frequent progress updates throughout the project life cycle is an important part of change control.
Evaluate
Finally, the team should conduct a self-assessment of the plan and implementation to identify if the project was successful. The team should define and measure success criteria. These could be simple objective metrics with targets such as inventory accuracy, occupancy, and density which objectively measure storage utilization improvement.
The evaluation should also examine the planning and implementation process so the organization can improve its execution. Simple questions such as – What went well? What didn’t go well? This will enable the organization to identify concrete improvement steps that the team can deploy as they work to maintain a healthy warehouse in the future.
Conclusion
DoD warehouse operations can achieve improvements in warehouse storage utilization to improve readiness. Metric performance for occupancy and density can achieve best-in-class metric performance with the right plan and resources while reducing the total footprint.
—Scott Gaston, St. Onge Company
