In most cases, it’s a given: When sales are up, it’s a good thing. Any for-profit business, regardless of industry, wants solid revenue growth each and every year.
However, once you step outside of the carpeted boardroom and take a walk on the hard distribution floor, all that is glitters is not always gold. That’s because endless order streams won’t boost the bottom line if those orders can’t be filled because of material handling constraints.
That was one lesson learned recently by a global thirdparty logistics provider (3PL) for wireless communications companies called Brightstar Corp. (Miami, www.brightstarcorp. com). Brightstar distributes wireless devices for several major original-equipment brands.
Since its founding in 1997, the 3PL has enjoyed steady and substantial business growth. Today, Brightstar operates sales and distribution facilities in more than 49 countries and delivers wireless products to more than 160,000 points of sale. Though the company distributes a portion of its orders to retail outlets, the vast majority of its business is direct to consumer.
Order fulfillment is only one task in which Brightstar specializes. The company offers other supply chain services, such as inventory management, customized packaging and assembly. In fact, Brightstar’s 250,000-square-foot facility in Libertyville, Ill., is equipped with configuration workstations where each wireless device is programmed and customized to exact customer requirements before leaving the dock door.
These value-added processes were still largely manual before November 2006. Packing and shipping were also done by hand. “The initial direct-ship process consisted of four gravity conveyor lines and manual stations occupying a 6,000-square-foot area,” says Jesse Garcia, operations manager at Brightstar.
The configuration workstations – also called work cells – at Libertyville were positioned several feet away from floor-level picking locations. Two separate picks – one for the wireless device and another for the blank memory card – were associated with each unit. Employees used one-to-one pick sheets and verified the picks with RF scanners. They built cartons at the pick locations, placed multiple orders on a cart, and rolled the cart to its assigned workstation, where memory cards would be installed in the devices and programmed. After the items were configured, workers walked the cart to the packing area. There, employees packed the cartons, manually weighed and scanned them and affixed shipping labels based on feedback from the WMS.
That procedure had been working fine since 2005, when the Libertyville facility started operating. By the following year, though, things were rapidly
changing. Because of the company’s well earned reputation for value-added distribution services, business was growing by leaps and bounds. In 2006, Brightstar reported a 50% year-over-year increase in revenue, ending the year with $3.5 billion in revenues.
“We were experiencing double-digit growth and needed a new process to streamline labor and automate the pick-program-pack and order-ship operations associated with direct phones, wireless devices and accessories shipments,” says Garcia.
Since the Libertyville facility was only a year old at the time, Garcia knew that moving to a new DC wouldn’t be a wise business decision. And, because he was satisfied with the current WMS, he didn’t particularly want all-new software technology.
“We wanted to automate the value-added processes and complement our WMS software,” explains Andrea Bradshaw, Brightstar’s executive vice president of operations. Since a new facility and WMS were out of the question, any outside solution would have to fit the layout of the current DC and also integrate seamlessly with its existing technology.
At that point, it was beginning to look like the best way to handle the increased demand was to find a way to reinvent the current material handling system.
“We had to reengineer our process to make it more efficient and automate it if we were going to continue to support our growth,” says Bradshaw. “Growth was driving the need for change.” Specifically, “we had too much headcount on the floor,” she notes. “Pick accuracy was not up to what we were striving for, and the process was too manual.”
Bradshaw and Garcia brainstormed some of the changes that would need to occur to support the company’s new clients, and Garcia took that vision to selected vendors. The mission, according to Garcia, was clear: “to develop a simple, yet streamlined, flow design, double output, reduce footprint, and most importantly, complete the project, from start to finish, in 90 days.”
That wouldn’t be easy. “We needed an experienced automation integrator with the capabilities to design, build and deliver a material handling system that would integrate into our existing WMS/shipping manifesting system,” Garcia explains.
Garcia shared the concept with at least four vendors. Most of them proposed expensive designs that required too much floor space and implementation time. One vendor, Numina Group, presented the most compelling case. Garcia had worked with Numina in the past on smaller projects and had been pleased with the results.
“Brightstar had a very short window for implementation – only 90 days,” says Dan Hanrahan, president of Numina. “They were bringing on new clients and needed an upgrade to the facility to meet the increase in shipping volume that would be required. The biggest challenge was integrating picking with the work-cell system.”
Instead of picking items from floorlevel locations, building cartons and putting orders on carts that would then be walked to work cells, Numina proposed that workers pick highmover SKUs directly to shipping cartons from flow racks on the upper level of a two-level automated pick module. “We slotted the fast movers in forward pick using flow rail,” says Hanrahan.
“The picking begins in the second level where the WMS releases orders,” adds Garcia. RF terminals are used for direct picking from the flow racks. Items are picked directly to shipping cartons, which are then conveyed by a TGW-Ermanco line shaft roller accumulation conveyor.
“After the pick, the conveyor brings the product to programming workstations located ‘upstairs’ in the pick module,” says Hanrahan. Once employees finish programming the devices, the cartons exit the workstations and are conveyed down to the lower level.
Cartons progress through Numina’s in-line scan/weigh/cube system, which is controlled by the integrator’s Real- Time Distribution (RDS) software. RDS is a Linux-based warehouse control and execution platform that directly integrates with Brightstar’s WMS, Hanrahan explains. RDS directs carton conveying, tracking, labeling and process validation. Weight and dimension data is transmitted in real time from RDS to Brightstar’s WMS.
“We write weight and cube information directly to tables in their WMS,” Hanrahan says. Because of this fast data connection, the scan/weigh/cube system can process up to 20 cartons per minute, he adds.
At packing stations on the lower level, employees inspect the orders, insert packing lists and seal the cartons. Cartons then travel on a CRUZbelt conveyor to a Panther 2000 top-apply print-and-apply applicator, which receives shipping labels from RDS. Ready-to-ship cartons exit the labeling system and are fluid loaded into carrier trailers.
Action and Reaction
Before Brightstar’s facility makeover, the company had been processing several thousand orders in a 10- to 12- hour period, according to Hanrahan. After redesigning its material handling system, the 3PL moves more than triple the orders in an eight-hour period. “The company has nearly four times the throughput it had before, without any increase in labor,” says Hanrahan.
|Putting pick locations and programming workstations on the second level of an automated pick module doubled Brightstar’s usable space.|
|By replacing carts with conveyors and consolidating picking and value-added operations, Brightstar more than tripled its throughput.|
|Once cartons are packed, sealed and labeled, they are fluid loaded onto a trailer and distributed to consumers. |
The decision to put configuration workstations in line with picking operations had the biggest impact on overall productivity, Hanrahan continues. “They had been scattered on the floor,” he says. “We put in the pick module to open up floor space.”
Garcia sees the results of the redesign first hand. “The solution utilized the 6,000 square feet on the first level and doubled the usable space through the two-level automated pick module,” he says.
Additionally, Numina helped Brightstar reduce overall travel time in the facility. “Before, we had very limited conveyors, so there was a lot of walking,” Bradshaw says. “We experienced a substantial increase in productivity, improved order accuracy and reduced headcount on the floor – a triple play,” she adds.
“We were able to retain our highly aggressive service levels along with our substantial growth,” Bradshaw reports. “We can deliver same-day-in, same-day-out service.”
Even better, the whole project was on time – within Brightstar’s 90-day implementation requirement – and within budget, says Bradshaw. All of those benefits added up to full payback within eight months of deployment, according to Bradshaw.
“In fact, we are so satisfied with the results that we are going to expand on it in the future,” she says. “Ultimately, we want to put all product into rapid pick zones and use the warehouse for bulk storage.” Brightstar’s future plans also include adding another pick module and a sortation system for diverting shipments to multiple carriers.
These future projects will no doubt benefit from lessons learned during the Numina facility redesign, since no operational makeover is without a few bumps. Among other things, the project team at Brightstar learned to start with a detailed plan and take on automation in phases.
“Make sure you have a well-thought-out plan and measure before and after to ensure you are actually solving the problems you set out to solve,” Bradshaw recommends. “We took on automation in phases to ensure ROI for each deployment. That gave us the opportunity to make modifications and adjustments to future planned phases based on our learning.”