Cost-Cutting Ideas

Dec. 1, 2001
WMS keeps orders moving at Graybar Electric.

WMS Keeps Orders Moving

The ability to fill customer orders quickly, accurately and affordably is a constant challenge for any industrial distributor. The right warehouse management system (WMS) is crucial in making the order-to-delivery process run smoothly, especially when the distribution facilities are large and operate over an integrated network.

In selecting a WMS, Graybar Electric, St. Louis, discovered that the company behind the software is just as important as the software package itself. By partnering with Provia Software, Graybar, a leading international distributor of electrical supplies and communication products, has been able to improve warehouse productivity in a number of ways. Provia provided the technical resources and project management for the initial WMS implementation, then transferred this knowledge to Graybar’s team so that it could do its own implementations across multiple sites.

Graybar Electric’s customers are primarily contractors, industrial plants, telephone companies, power utilities and commercial users. The company operates 292 stocking locations throughout the U.S., Canada, Puerto Rico, Mexico and Singapore.

Graybar knew that an effective WMS was a key element in maintaining and improving the company’s customer service requirements. “Logistics is all about customer service,” said Ed Keith, Graybar’s vice president of logistics. “If a customer orders product from us and we can’t find it, then we can’t ship it. The customer doesn’t care if we tell them that we know we have the product somewhere in our facility, but can’t locate it right now; they only care if they can get the product. Missed shipments are missed opportunities to keep our customers happy.”

Approximately three years ago, Graybar began working with PricewaterhouseCoopers to consolidate and optimize their distribution network. PwC’s analysis and recommendations resulted in Graybar consolidating the company’s inventory distribution system into regional zones. Each regional zone location would range in size from 145,000 to 300,000 square feet and would redistribute product to Graybar’s many branch facilities around the country with next-day delivery.

With four sites already live with Provia’s WMS, Graybar is moving forward with plans to install the product in at least 16 regional zone facilities.

According to Graybar’s Keith, the benefits of implementing the WMS are beginning to take shape. “Whether you measure it by lines picked or lines put away, orders processed, or receiving; just about every way you look at it, we’ve seen about a 15 percent improvement in our overall productivity. Our inventory accuracy has also improved dramatically, to the point where the discrepancies between product we thought was in a facility and what actually was there have virtually disappeared.”

Because Graybar mostly deals with each picking and not full-carton packaging, efficient use of warehouse space is important. With the new WMS in place, Graybar was able to realize about a 10 percent improvement in space utilization at each facility. “With the size of our facilities, a 10 percent improvement in space utilization translates into a lot of additional product we can house in each site and extends the active life of the facility without having to add on by quite a bit,” said Keith.

Warehouse management system by Provia Software.