October 1996 € Volume 6 € Number 10

Keeping House in the Warehouse and Project Management

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By George Johnson, CFPIM

This department is provided to answer technical questions regarding problems in production and inventory control. Readers are invited to contact George Johnson, APICS National Research Committee, Rochester Institute of

Dear APICS: I am in warehousing and would like to know more about the issues of housekeeping and appearance.

Reply: Many readers no doubt have seen housekeeping discussed in the literature of JIT. Usually, it is cited as affecting quality, morale and efficiency. However, OSHA has been involved in the issue from a safety perspective since at least 1970. The FDA has been interested in sanitation since the 1960s.

In warehousing, the most frequently cited housekeeping issues involve unstable storage stacks, insecure dock plates, cluttered aisles, inappropriate use of material handling equipment, and the use of safety gear such as hard hats, goggles, safety shoes, gloves, etc. Sanitation problems usually involve contamination by rodents, insects and birds or by chemicals.

The consequences of poor housekeeping and sanitation can be serious. Ackerman (1990) notes, "Bad sanitation and safety are the consequences that concern the government. Many others should be of even greater concern to warehouse management. The first and foremost important sign of poor housekeeping is a drop in productivity." This handbook by Ackerman contains checklists for sanitation and housekeeping.

Several references on these topics and on warehousing in general are listed below. However, before we visit the list, let me invite you to challenge yourself with a big question: Do you really need the warehouse in the first place?

Generally, when product, material or supplies are standing still, they are like piles of money just sitting around. They gather dust; earn no return; require counting and security measures; tend to disappear or become unusable anyhow; occupy space; etc. Why is it necessary, in the first place, to store the things you store? Is there a way to function effectively without the warehouse?

For example, could you put the contents in trucks or other forms of transport and get them moving toward their next point of use (as Sunkist does with oranges)? At least this would convert idle inventory into pipeline inventory-on the move.

Could you eliminate most warehousing assets and systems and produce/air ship on demand (as FedEx does with service parts for some manufacturers)? Spending more on transportation and less on warehousing/inventory may work out to be less costly in total than the existing arrangement.

If the bulk of warehouse contents results from long setup or resupply times (cycle stock), could you divert some of the money spent on warehousing to a setup reduction program or to reduction of resupply cycle time? This kind of investment could pay recurring dividends.

If the bulk of contents is there as safety stock because of uncertain demand, could you do joint planning with the customers responsible for most of the variability, to reduce much of the uncertainty (hence less safety stock would be required)?

Sometimes warehousing is essential. Then, of course, it should be done in the most effective and efficient manner. But most people never ask themselves the fundamental question.

References
Abramowski, R., "Warehouses Are Where You Store Things; Distribution is a Science!" APICS&emdash;The Performance Advantage, Aug. 1993, pp. 58-59.

Ackerman, K., Practical Handbook of Warehousing, Third Edition, Van Nostrand Reinhold, 1990. (See Chapter 23, "Safety, Sanitation and Housekeeping." Contains useful checklists.)

Ackerman, K., B. LaLonde, "Making Warehousing More Efficient," Inventory Management APICS Readings for CPIM (Harvard Business Review), 1993, pp. 73-end.

A.T. Kearney, Improving Quality and Productivity in the Logistics Process, The Council of Logistics Management, 1991. (Contains several detailed appendices which discuss quality and productivity measures. See, especially, Appendix B, "Measuring Quality and Productivity in Warehousing.")

Calvert, G., "Xerox: A New Streamlined Model," Inbound Logistics, May 1994, pp. 44-49.

Gray, C.F., "An Integrated Methodology for Dynamic Labor Productivity Standards, Performance Control, and Systems Audit in Warehouse Operations," Production and Inventory Management Journal, Third Quarter 1992, pp. 63-67.

Hurtubis, E., "Implementing a Picture Perfect Warehouse Management System," APICS&emdash;The Performance Advantage, November 1994, pp. 32-35.

Pincus, A.; Erickson, R., "Maximizing Productivity From Inventory Management," APICS&emdash;The Performance Advantage, September 1994, pp. 40-43.

Young, Jan, "How to Evaluate a Warehouse in One Easy Walk-Through," APICS&emdash;The Performance Advantage, April 1995, pp. 26-29. (Good for a quick walk-through checklist.)

Dear APICS: What are some general references on Project Management?

Reply: According to the APICS Dictionary, a project is, "An endeavor with a specific objective to be met within the prescribed time and dollar limitations and that has been assigned for definition or execution." (Pg.68) In the context of production and inventory management, a project commonly involves the selection, installation and implementation of a software system for materials management. It could involve a focused improvement activity, a product design/launch, the preparation of a bid, the construction of new facilities or the purchase of new equipment.

In any case, projects usually are thought of as one-time endeavors which entail the participation of people across functions and require significantly large amounts of resources. The activities involved generally are complex in nature and are interrelated in such a fashion that some are sequentially dependent and others may proceed in parallel.

The one-time, costly, cross-disciplinary and interdependent nature of projects usually makes them candidates for a particular type of management. A project manager commonly leads or coordinates the complex undertaking, and "borrows" people from the business functional areas. It is the manager's job to accomplish the undertaking within the allotted time and resources, using whatever human resources can be garnered.

References
A Guide to the Project Management Body of Knowledge, Project Management Institute Standards Committee, 1996. (PMI is located at 130 South State Road, Upper Darby, PA 19082.)

Burris, R., "5 Essential Project Management Skills," APICS&emdash;The Performance Advantage, August 1994, pp. 22-24.

Heck, M., "Basic Planning," Infoworld, June 3, 1996, pp. 85-86. (Review of software for project management.)

Keane, J., "A Holistic View of Project Management," Systems 3X/400, June 1966, pp. 58-61.

Linkow, P. "The People Side of Project Management," CMA Magazine, December 1995, pp. 23-25.

Managing Projects and Programs, Harvard Business School Press, 1989.

Meredith, J., and S. Mantel Jr., Project Management, John Wiley & Sons, 1995.

Munns, A., "The Role of Project Management in Achieving Project Success," International Journal of Project Management, April 1966, pp. 81-87.

Randolph, W., and B. Posner, B., "What Every Manager Needs to Know About Project Management," Sloan Management Review, Summer 1988, pp. 65-74.

Shelly, A. E., "Project Management: The Forgotten Art," 36th International Conference Proceedings, APICS, 1993, pp. 726-728.

Trew, D., "Developing the Project Plan," APICS&emdash;The Performance Advantage, May 1995, pp. 57.

Walsh, J., and J. Kanter, "Toward More Successful Project Management," Journal of Systems Management, Jan. 1988, pp. 16-21.

Wojciak, P., "So You're the Project Leader! 10 Roadblocks to Watch Out For," 38th International Conference Proceedings, APICS, 1995, pp. 166-169.