MATERIAL HANDLING MANAGEMENT INNOVATION AWARDS 2003

Although Innovation is the attribute these awards celebrate, there are many other qualities that, if the awards were big enough, MHM would have inscribed on them: Courage. Insight. Leadership. Individualism.

There are plenty of innovative material handling products and systems available on the market, but if using new technology were all it took to succeed, everyone would be a winner. Surgeons aren't judged by their tools, but by their skills. That's why MHM's editors selected innovators from among its readers.

That said, we didn't want to ignore the innovators from years past who are responsible for inventing the tools of today's material handling specialists. You'll find our salute to these material handling pioneers starting on page 35.

We hope these examples of material handling innovation inspire you to achieve your own level of greatness. If they do, or if you've already embarked on your own R&D journey, let us know. You could be among MHM's innovators of 2004.

Gregg Schwerdt

distribution manager, beauty care, Procter & Gamble

Procter & Gamble's Corporate Engineering organization is dedicated to developing tools that will help its distribution centers deliver on the promise of quality. Advanced computer techniques and an expert system now help P&G orderpickers plan and execute orders with minimal damage and errors.

Challenges

In 1991 the company assembled a high-level team to study the cost of damaged product. It found opportunities to save millions of dollars a year by fixing problems related to overs, shorts and damage (OS&D). These opportunities were discovered in P&G's distribution facilities, in transit and at customer sites.

While P&G got control of its unit load damage by converting to pallet handling and designing for pallet fit, the mixed palletloads prepared by the orderpickers remained vulnerable — especially in health care and beauty care, where 70 percent of the company's volume ships to customers on mixed-SKU pallets. That's why P&G's logistics team turned its attention to orderpicking.

Innovation

P&G developed two separate but complementary innovations for the orderpickers. The first, given the name POWA (Perfect Orders through Weight Auditing), involved taking advantage of its RTCIS (Real Time Control and Information System), a warehouse management system (WMS) developed by P&G and supported by RedPrairie Software. Under RTCIS, warehouse lift truck operators stay in radio frequency contact with the warehouse computer through LXE 2100 on-board computer terminals. With this real-time system, the computer always has correct information about the content of each warehouse and location of every pallet of product. There is no lag time.

The orderpickers' smaller trucks have these terminals, too. RF technology is used with Symbol Technologies' scanners to locate the product and to receive and transmit data as the operators pick. The computer tells the picker what is required and where to find it, and the picker reports back to the computer what he/she has done. If product is missed, RTCIS will not allow the order to be closed out for shipment.

But under this method alone, the picker must decide the pick sequence from a list that may run to several pages. P&G's next technological leap began with a work sampling study of picker activity conducted by the University of Cincinnati's Industrial Engineering Department. From this came a program built on artificial intelligence. Working with Moore and Associates, a consulting firm, P&G focused on the challenges of orderpicking onto a pallet.

The resulting system was named AutoPalletP3, which replaces one long picking list with a series of short pick lists, each of which is for one double set (a pair of pallets) measuring 40 x 48 inches and truck height. Case picks are fed into the P3 system, which resides on P&G's mid-range HP-9000 computer, with the RTCIS system. P3 will go through a set of load considerations and determine, based on load density and crush indexes, how to build the palletload to minimize damage and maximize loading efficiencies while grouping the products in the way customers prefer. This information is used to print a pick-list for each double set, to be picked strictly in sequence. These route the pickers throughout the warehouse on the most efficient pick tours based on how cases of product are zoned. Several pickers can work on the same order.

Results

Now that pickers are relieved of critical decision-making, they can focus on quality and accuracy. This has raised productivity more than 20 percent at P&G's two Health Care/Beauty Care distribution centers. In addition, the quality and consistency of truck loads have improved. P&G can plan larger truck loads because the double sets are of predictable maximum height and are stable.

Jim Houck

system wide manager, ground support equipment-GSE, Continental Airlines

Innovation is a must if airline managers are to meet their industry's challenging environmental needs during its most competitive period

Challenges

The international airline business faces high and rising fuel prices, the continuing impact of Sept. 11, intense regulation, and even more intense competition. As if those weren't enough, the Environmental Protection Agency (EPA) is demanding that the industry improve air quality by reducing emissions. Continental Airlines, like all the major lines, shares these and many more challenges with its global competitors.

Jim Houck is GSE Systemwide Manager at Continental. He's responsible for managing all ground support equipment shops, specifying and demonstrating new equipment, determining reliability and developing a fleet of low-emission motorized equipment. At the Houston facility, Continental's largest hub, the airline has 6,300 pieces of motorized equipment, including roughly 275 lift trucks and 100 electric towing tractors, as well as more than 9,000 non-motorized carts and dollies.

"Our biggest challenge was in meeting the new EPA mandates and state regulations on air pollution," says Houck. "Gasoline-powered equipment was producing too high a level of emissions, and so was propane, and the addition of catalytic converters wasn't feasible on a large scale. It was clear that we needed to convert more equipment to electric power, but we had performance requirements to think about, and we didn't want to sacrifice that operational performance for a lot of recharging time."

Then, there was the problem of battery charging time. Houck says electric equipment was fine, but with a typical seven-hour charging period, conventional charging methods proved to be too slow for an airline hub environment.

Innovation

To service all the batteries required by an expanded electric-powered ground support equipment fleet, Houck and his GSE team decided on a fast-charging system. Working with AeroVironment, he found a charging system that recognizes all different equipment and voltages. The fast charging system identifies the battery size and type, voltage, battery temperature, and even notes the last time the battery was equalized. Houck worked with the local Toyota lift truck dealer to install the circuitry, battery cold plugs and charging receptacles needed.

"By reducing the room and labor required for battery charging," Houck says, "we felt we could get batteries charged in an hour. The time required to fast-charge a battery from 20 percent charge to the range of 80 to 100 percent was provided by shift changes and break times."

Houck selected Toyota's 7-Series electric pneumatic lift trucks, which are AC-powered. "The AC drive has the power we need, and it actually rivals I.C. power," he says. "With the pneumatic tires, it's perfectly suited for outdoor use. Plus, we're noticing a huge difference in maintenance because we don't have to change motor brushes."

Results

Increasing the number of electric-powered ground support equipment, and switching to fast-charging systems, produced many benefits for Continental.

First, of course, were the benefits to the environment. Jim Houck says, "Continental takes pride in reducing emissions and in making a positive impact on the environment."

Then, there are the economic benefits. Continental has experienced tremendous reductions in maintenance and fuel costs on its ground support equipment. Maintenance costs are down 60 to 70 percent where gasoline-powered equipment was replaced by fast-charging electrics. The operator is no longer responsible for battery management, which is cost effective.

Plus, Continental now uses battery charger single plugs and receptacles, which makes snapping the plugs in and out much easier. Operators can now disconnect with one hand. That, plus not having to take operators' time for fuel and fluid checks, saves a lot of time.

Bob Titzer

director of systems engineering for Sara Lee's Casual Wear Division

Bob Titzer's innovation lies in remissioning the material handling systems of an out-of-business company and translating the up-front money savings into long-term supply chain productivity.

Challenges

Sara Lee Casual Wear (SLCW) was running out of space at its two East Coast distribution centers and was looking at different ways to meet its current and future distribution needs. In looking for ways to solve its problem, the company came upon a facility that had been shut down and was currently vacant due to a bankruptcy the previous year.

The Tultex distribution center was one of the most highly automated facilities to be implemented in North America in the 1990's. There had been many complaints by local workers that the complexity of the automation caused the failure of Tultex's business. Though that wasn't the case, there was a lot of risk in bringing its automation back to a new life.

The Tultex facility under review was commissioned in the 1989/90 timeframe. The system consisted of the following elements:

11-Aisle Dbl-Shuttle, Dbl-Deep Pallet AS/RS

14-Aisle Dbl-Shuttle Pallet AS/RS

3-Aisle 15 SRM Tote AS/RS with Put-to-Light

1 Mile of Pallet Conveyor

3.5 Miles of Tote Conveyor

Innovation

Sara Lee Corporation put together an internal task force and contracted the help of an external consultant (St. Onge Company) to help it evaluate whether the Tultex facility would meet the unique distribution requirements of the SLCW division. Sara Lee assigned Bob Titzer, director of systems engineering for Sara Lee's Casualwear Division, to provide the technical leadership to revive and remission the automation. Bob has many years of experience with automated systems and understood what needed to be done and where he could find qualified help. Bob's most significant project concern was with the nine-month project schedule that was essential to the success of SLCW's business plan.

The remissioning expansion of the Tultex facility was broken down into nine subprojects:

1. A new narrow-aisle conventional storage facility;

2. Rework existing facility: extensive general construction;

3. Implement business systems and new network infrastructure;

4. New warehouse management system including the consolidation of two existing warehouses;

5. New AS/RS inventory management and material handling control system;

6. Upgrade the unit load storage/retrieval machines for improved efficiency and reliability;

7. Retrofit the pallet and case conveyor equipment;

8. Upgrade the pallet and case conveyor control system;

9. New tilt-tray sortation.

Titzer's team extended and adapted three miles of undocumented 15-year-old case conveyor to handle new tote and package sizes. Some $1.2 million was saved in conveyor layout modifications. Very little of the original conveyor needed to be replaced.

Then there was the control system. Titzer knew that 15-year-old equipment control could be difficult to support and impossible to modify. The supplier partners upgraded/salvaged OEM control, eliminated problem logic, and, where required, wrote new user-supportable logic.

Titzer also hired former Tultex employees who offered invaluable input on what worked, how it worked and what were past problem points. Hiring former employees early helped in project decision making.

Results

Working with HK Systems throughout the course of this project, Bob Titzer's team turned this remissioned distribution center into one of the best examples of automation done right in North America. A sample of the daily business activities:

20+ inbound trailers unloaded and put away per day;

9,000+ dozen garments prepped and packaged per day;

60,000+ dozen garments shipped per day,

150,000+ total pallet inventory.

Titzer takes pride in the fact that he built a 21st Century automation masterpiece out of garage sale parts for Sara Lee Corporation.

Lt. Col. Alan B. Will

U.S. Marine Corps Forces Atlantic Material

Management Officer

You can't win a war without excellent material handling logistics. Weapon systems need spare parts at a moment's notice, so knowing what's available, where it's located, and when and how it will be delivered requires a deployable, real-time logistics information system. The Marines call it a "WMS in a Box."

Challenge

The weather and logistics conditions in a place like Kuwait aren't friendly to technology. That's why the Marines had always used paper pick lists supplied by their host supply system. When they initially experimented with a radio frequency (RF) based warehouse management system, response was slow. After corrective action was implemented, the RF system operated as designed. The RF communication between servers and users is key to real time operations.

The Marines' container lot which serves as a warehouse in Kuwait is approximately 1.1 miles long by .6 miles wide. This necessitated RF repeaters to take the signal from each individual Psion Teklogix RF device and relay it to the deployable container with the servers.

"Teklogix worked with us on this requirement and provided the solution with their dual radio access points," explains Lt. Col. Alan Will, U.S. Marine Corps Forces Atlantic Material Management Officer.

Innovation

Col. Will was the Marines' go-to officer on its "WMS in a box" concept. The "WMS in a box" is a complete WMS which includes the STRATIS WMS servers, RF system and portable bar code printers all in an environmentally controlled deployable container. The idea is to fly one of these containers into a theater of operation and quickly establish automated warehouse operations. The WMS in a box provides complete RF coverage over the warehouse area and also provides control of automated storage systems, specifically containers equipped with horizontal carousels (FKI Logistex, White Systems) inside. As containers of parts come ashore, Marines can upload the contents of each of the containers with data disks, optical memory cards or RFID tags. The host system can pump all of the field demands into the WMS for pick action. The antenna for the RF is located on top of the container and connects to the distant RF antennas via wireless LAN or repeater operations. This provides for RF coverage over large areas.

After successful employment in Kuwait, the concept is being fielded to forces located in Camp Pendelton, CA. Additional functional enhancements will be developed to better meet the Marines' requirements in a deployed environment.

"We will further develop the concept of integrating it with the Maritime Prepositioning Force operations, to include tracking materials offloaded from the ships and the regeneration of forces after an operation has terminated," Will explains.

How important will this concept be in future military missions?

"It's very important," Will answers, "because it allows us to more accurately track materials during movement and storage, as well as reduce manhour requirements and the time required to process items. The larger the operation, the greater the benefit realized. It will allow us to quickly build a field warehouse facility and begin supporting customers in the field."

Results

This concept allows the Marines to quickly establish supply operations in support of military operations, issue and receive materials during these operations and quickly dismantle the field warehouses and repack materials in containers upon conclusion of the operations.

"The WMS also allows us to realize a high level of inventory accuracy and carry out warehouse tasks with less manpower," Col. Will concludes. "Operations can be established in a short period of time by employing what is essentially a self contained system. Use of a WMS does not require a great deal of infrastructure, either in terms of computer rooms or permanent warehouses. It is an excellent fit for any temporary warehouse scenario when there is a need to establish WMS operations prior to completing construction of a brick and mortar warehouse."

Conrad Hawley

production control manager, DaimlerChrysler

Twinsburg, Ohio Stamping Plant

Hawley and his team found a way to give new life to an aging stamping plant at a time when the company was struggling with losses in the billions of dollars. Clearly they have contributed to the financial turnaround of this Chrysler Operating Unit (more than $1 billion in profit in 2002) and proved that with the right people and plan it can be better to modernize than replace or relocate.

Challenges

Since the plant opened in 1958, lift trucks have been its primary form of material handling. A fleet of 138 vehicles fed the hungry stamping lines. Strict safety guidelines demanded that operators with full loads drive in reverse. This directive resulted in many sore backs and necks, as well as accompanying medical claims.

Hawley and material handling engineer Jim Petruna decided that automatic guided vehicles (AGVs) could be a valid alternative to lift trucks in this environment. They saw AGVs work with old systems and decided there wasn't anything these plants were doing that couldn't be repeated in Twinsburg.

To make AGVs work in this environment, however, they had to overcome several constraints.

The plant's age was the first constraint. The location of the equipment, width of the narrow aisles, and irregular woodblock floor (including in-plant railroad crossings) were set and could not be changed.

A second major obstacle centered around the labor force. After doing things the same way for many years, there was resistance to change. There was the general perception that automation is the enemy because it eliminates jobs. Jim and Conrad's challenge was to gain acceptance by the labor force. Knowing that, they sat down with the union that handles maintenance and agreed that they would maintain the AGVs.

A third major obstacle involved providing an acceptable ROI or payback by not only keeping pace with increased production, but by reducing costs in areas (labor & damaged material) while maintaining high safety standards and ergonomic issues.

Innovation

A key element was to break the project into small phases, prove the concept and expand. Using this methodology, the project developed momentum. As one phase was successfully completed there was an emotional lift which increased support for the next phase.

"We focused on multiple stage projects in all departments," explains Jim Petruna. "We wanted everyone including management, the union and the safety department comfortable with the solution. This phased implementation approach becomes more beneficial as the system price increases and as the potential effects on production increase. You limit risk by 'walking before you run.'"

After evaluating the alternatives, Conrad and Jim developed an automated material handling solution which included self-guided vehicles, over/under racks, turntables, and blank feed tables.

Results

The team met all of its cost-savings goals, and throughput increased by 25 percent thanks to reduced downtime in the pressroom and assembly areas. The documented ROI was less than one year.

In addition, Twinsburg has become the benchmark stamping plant for DaimlerChrysler and the company's other two stamping plants are now implementing similar programs. Engineering teams from Daimler's plants worldwide have visited to learn from what has been accomplished in Twinsburg.

Twinsburg was also the first major guided vehicle installation in the North American automotive industry which took advantage of laser bumper technology. This was a major advancement and nearly every guided vehicle installation since Twinsburg has used laser bumpers in the same arrangement that was perfected at this plant.

Education

Leon F. McGinnis

Dr. Richard E. (Dick) Ward

Dr.Leon McGinnis, Ph.D., Professor, Georgia Tech School of Industrial and Systems Engineering, is the innovator behind iDEAs, the Internet-based data development analysis system for system-based self-assessment of industrial system productivity. The iDEAs program was developed by the Keck Virtual Factory Lab at Georgia Institute of Technology.

For purposes of the MHM Innovation Awards program, however, the iDEAs application is focused strictly on warehousing at this time. The iDEAs application enables you to take information about your warehouse and compare it to information about a lot of warehouses in the data base," Dr. McGinnis says. "And from that information we construct what I call a 'fantasy league' warehouse which produces the same thing your warehouse does in terms of orders shipped — but uses the fewest possible resources."

Continues Dr. McGinnis, "What this analysis does is give you an idea about where you stand relative to the best possible performance, constructed on the basis of real warehouses. It's not benchmarking in the classical sense: it's more performance assessment of where you rank compared to other warehouses."

However, iDEAs researchers have gone considerably past the basic performance assessment in the past few years. "And what we've been able to do with the warehouse now is to begin to do some diagnostic analysis," Dr. McGinnis says. So, if you were interested in looking at standard partial productivity, like lines picked per labor hour, what iDEAs can do is pick a comparison warehouse for you — maybe the warehouse that has the best pick per labor hour. The analysis will show you how much of the difference between you and the comparison warehouse is due to things like scale of operations. "If you're a warehouse manager and a big part of the gap is due to scale of operations, it's not something you have control over," Dr. McGinnis says. "We also say how much of it is due to the difference in resources, which you may or may not have control over. The same applies to, say, order profile."

One preliminary finding is startling, says Dr.McGinnis, emphasizing that it's preliminary because the researchers don't have much data yet. "It appears from the preliminary data that warehouses that spend more on maintenance are dramatically better in terms of resource efficiency. That's data from only a couple of dozen warehouses," he says.

If researchers can get results like this, it would be of benefit to small warehouses that don't have a lot of money to spend on consultants. "We can give them something concrete they can grab onto and make significant improvements in operations," Dr.McGinnis says. Visit the iDEAs website at www.isye.gatech.edu/ideas.

Dr. Richard E. (Dick) Ward, executive vice president — professional development of Material Handling Industry of America, is a long-time innovator in material handling. In the case of iDEAs, he's the one who got Leon McGinnis thinking about getting it started.

"I was aware — Leon and I are close friends — of the work he had been doing in the semiconductor industry: benchmarking, performance and semiconductor manufacturing," Ward recalls "I thought, we ought to take that map, if you will, and that approach and apply it to manufacturing."

Dr. Ward's own academic background is right at home in research and development. Prior to 1981 he was a professor of industrial engineering, "teaching young engineers about material handling system design," as he puts it. Now he's executive vice president - professional development of Material Handling Industry of America, which sponsors an international research colloquium every two years. (The next one will be held in 2004 in Graz, Austria.)

Dick served as president of the College-Industry Council on Material Handling Education (CIC-MHE). His tenure as president ended in 1985, but he's still active and involved. As president, he promoted the idea that CIC-MHE and MHIA have joint meetings instead of meeting separately. "The achievements of CIC-MHE since that time underscore the value of that change and what can happen when industry and academia work together," says Dick.

Power Sources

Geoffrey Ballard

chair of General Hydrogen Corporation and chairman emeritus of the Canadian Hydrogen Association

Geoffrey Ballard is acknowledged worldwide as the father of the fuel cell industry. He founded Ballard Power Systems and, in 1979, brought together and funded a technical team to explore the development of high energy density power systems.

In 1983, Ballard began the development of Proton Exchange Membrane (PEM) fuel cells. By 1987, the company had achieved significant power improvements that showed the promise of fuel cells. In 1990, the company began the drive towards commercialization. This culminated in 1993 with the highly successful introduction of the world's first hydrogen fuel cell-powered zero emission transit bus at Science World in Vancouver. As a result of this event, effectively all the major automobile companies in the world are now in a race to bring fuel cell vehicles to full commercialization.

But before we reach that point, the technology must be proven further, and that will happen in the world of material handling.

"With a lift truck fleet, you create a very large market for fuel cells which will bring the price down," Ballard explains. "As you slide down that curve there are a series of market niches that open up as the price drops. That includes backup power for the computer systems in your warehouses."

Ballard cautions, however, that we have to expand the use of hydrogen as we expand the use of fuel cells.

"As you learn to fuel your lift trucks and you have them at every distribution point, you automatically create a hydrogen infrastructure," he continues. "Take a Wal-Mart, for example. They have DCs and 4,500 retail outlets and they're putting up new ones every day. The DCs would now have hydrogen on site to fuel the lift trucks that operate in those centers. They also have corresponding lift trucks in each of the stores, so the DC, through existing trucking arrangements, would deliver hydrogen to the retail outlets to run the three or four lift trucks in each of those locations. The hydrogen could also run the UPS system that's in each retail outlet. Now you have, very quickly, at an industrial level, a pathway for hydrogen to go right to the consumer through the shopping mall."

Dr. Ballard developed his vision of hydrogen's future through his experience in the private and public sectors. Prior to the development of Ballard Power Systems, he spent 10 years with the U.S. Department of Defense. In 1974, he was appointed to the Federal Energy Office in Washington, D.C. as the Director of Research for the Office of Energy Conservation.

Dr. Ballard serves on a number of boards and panels for the Canadian, British Columbia and California governments and several universities in Canada and the United States. He serves on the Canadian NRCAN Hydrogen Technology Advisory Group.

He was named "Business Leader of the Year" by Scientific American magazine in November 2002, and was honored for "Energy Innovation" by Discover magazine in July 2002. In December 2001, he was featured as a Master of Modern Technology on CBC Newsworld. Time magazine identified Dr. Ballard as a "Hero for the Planet" in 1999.

This hero and innovator has a vision. He predicts that the hydrogen infrastructure that will develop over the next decade will eventually result in a major reduction in inner city air pollution and the significantly improved health of citizens in those areas. And it will all start with the world of material handling.

Lift Trucks

George Raymond

The Raymond Corporation's commitment to innovation can be traced to the day George Raymond, Sr. purchased a foundry called Lyon Iron Works in Greene, NY in 1922. Since 1840, Lyon Iron Works had produced agricultural equipment for the rural community. The cast iron wheels, buckboards and dollies that Lyon Iron Works manufactured were the origins of the sophisticated lift trucks the Raymond Corporation makes today.

Born in Owego, N.Y. in 1889 and educated at Cornell University, George Raymond, Sr. received his grounding in innovation while working for an engineering firm in Brooklyn, NY. With his innovative eye developing a vision for the future, Raymond, Sr. eventually built his company and surrounded himself with talented employees who also had mechanical and engineering abilities. Teaming up with a young employee named William House, Raymond built a reputation for custom designed iron and hardwood products, built to customers' specifications. Using customers' sketches and personal interviews, Raymond and House built three-wheel carts, ensilage cutters, pulleys, horse treadmills and plow cultivators.

Under direction from Raymond, Lyon Iron Works developed the first commercially successful hydraulic hand lift truck for handling skid platforms in 1936. From that development came the L4P, the first hand lift truck for transporting double-faced pallets.

Following the Great Depression and World War II, the company became The Lyon-Raymond Corporation. Raymond hired a new engineer, Christian Gibson, and together they designed new and innovative materials handling equipment. The turning point for Lyon-Raymond came with the L2P, the lighter and more agile version of the L4P. It could lift one ton, making it popular for general warehousing applications.

Lift truck technology changed forever with Lyon-Raymond's introduction of the first narrow-aisle lift truck in 1951. Although the concept of narrow aisles had not yet caught on, as an efficiency engineer Raymond believed a future of narrow aisle warehouses lay ahead, and he positioned his company to be ready.

Working with Gibson and a well-known warehouse consultant, Harry Messerole, Raymond saw the future for a revolutionary forklift product — a battery-operated, rider lift truck. The result was the Model 700 Space Maker, the world's first electric, narrow aisle truck to work in aisles less than seven feet wide. Designed without a counterbalancing chassis, the Model 700 Space Maker preserved its gravitational integrity by straddling the pallet with base legs, a basic principle for narrow aisle trucks that is still used today.

The new lift truck would give warehouses a revolutionary new way to store materials and free up valuable warehouse space, saving the materials handling industry millions of dollars each year.

Raymond, Sr. and Gibson were granted the patent on the "power-driven, narrow-aisle material handing truck" in August, 1951. That same year, The Lyon-Raymond Corporation became The Raymond Corporation.

By 1953, the 1,000th Model 700 Space Maker rolled off the assembly line at the Greene factory. The company also established its first

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