Two Customers, One Warehouse

In France, Still and Fenwick, two forklift manufacturers that are part of the Linde Group, are supplied with spare parts from two warehouses connected by an automated guided vehicle system. As a service provider for Still and Fenwick, Urban-Transporte uses the warehouses to store a myriad of parts ranging from small screws to powerful transmission blocks. The materials are stored in various areas of the warehouse according to their size, weight, and turnover rate. Some areas are handled manually, and some are managed completely automatically. Appropriate strategies for storage and picking make sure that everything runs efficiently.
The warehouse in Elancourt consists of two different storage areas. Heavy and oversized parts are stored in high-bay areas serviced by forklifts. But large quantities of small parts are first stored here on pallets and moved to the automated small-parts warehouse depending upon turnover. Urban-Transporte uses trays to achieve the highest possible performance and use of the facility. The trays are carriers that hold containers of various sizes. The actual storage locations in the small parts warehouse are connected by automatic rack feeders and role-based conveyors.

A Component of Decentralized Warehouse Management

The warehouse is managed using the logistics execution system (LES) from SAP, which allows Urban’s customers to access it directly from their ERP systems at any time. The standard SAP interface between logistics execution and integrated decentralized warehouse (LE-IDW) has proven beneficial. The interface provides an essential component of decentralized warehouse management because it couples non-SAP solutions to the LES without a great deal of effort. At the time of the implementation at the end of 2003, the LES was first connected only to a customer’s proprietary application, which was migrated to SAP R/3 Enterprise a few months later. No modifications of the LES had to be performed in either situation.

The warehouse management system consistently implements the service of Urban-Transporte. The system serves several ERP clients and ensures that each client (or customer) can view only its own stocks. This security requires strict separation and assignment of stocks in the warehouse. The separation occurs only virtually and in terms of accounting. Physical locations are used optimally, regardless of who owns the materials. Parts can be moved while in storage to make sure that space is always used in the best possible way. The operating costs of the warehouse are calculated and itemized separately. “Our customers benefit from considerable cost savings by sharing a warehouse. The warehouse features high availability and short throughput times. It enables us to react quickly to customer requirements,” says Dirk Sadler, general manager of Urban-Transporte.

Cross-Client Classification

Special requirements had to be met to make the LES from SAP usable to a logistics and warehouse services provider like Urban-Transporte. The situation requires unique assignments – not only of stocks, but also of documents, vendors, and the customers of various buyers. Mix-ups and errors can occur if different ERP clients assign new key terms to different documents. To make sure that the files in warehouse and transport management can be identified without ambiguity, the LES from SAP uses an additional, internal, and cross-client classification. The classification makes operating processes more secure while allowing users to work with familiar characteristics.
Siemens L&A software controls the material flow at Elancourt. Both solutions – the LES from SAP and the material flow system from Siemens L&A – are completely integrated and complement each other. The LES from SAP executes all scheduling and planning tasks; the subordinate application handles all processes related to material flows. Among other tasks, the LES from SAP assigns containers and pallets to aisles, determines processing steps, sets priorities, and evaluates the workload. The system also compiles sequences for order picking so that deliveries can be bundled economically and quickly. For example, shipments destined for specific regions or high-priority orders are combined. The material flow computer from Siemens handles sequential possessing. The LES from SAP was enhanced with important functions for work in this area, including tray management for containers of various sizes and stock rotation strategies that optimize the inflow and outflow of materials.

Seven Orders in Parallel

“The complex demands on the IT system were implemented extremely proficiently based upon the LES from SAP,” says Dirk Sadler. For the warehouse near Paris, Siemens realized a picking solution that displays partial deliveries on employees’ screens. A put-to-light application supports the picking process. Combined with the put-to-light system, the graphical display of each picking order enables extremely low error rates. Screens in the small parts warehouse display the trays and their contents. Each workstation can process seven orders in parallel. The material flow software assigns items to the target containers. Colors in the put-to-light system support pickers during their work. Employees scan the labels of parts they have removed and push a button to confirm that the parts have been placed in the transport container. That action closes the picking process and the order is posted immediately.

Since the system went live in Elancourt in 2004, all customer requirements have been met – or exceeded. The maximum picking performance (the number of picks per unit of time) of 590 picks per hour clearly exceeds the company’s requirement of 505 picks per hour. The service level is an especially important key figure, because meeting or exceeding it affects the service provider’s remuneration. The service level describes the ratio of on-time deliveries to the total number of items to be processed. Innovations in the warehouse increase the company’s ability to deliver and the accuracy of deliveries, transparent material and information flows, shorter throughput times for the total order, and an increase in the quality of picking. The new technology exceeded all these targets – sometimes by several percentage points.
Cross-system communication with customers and partners is especially important for third-party logistics providers, so it is supported by interfaces in the LES from SAP. The data can be queried in almost real time. For example, customer service representatives always have a view of their container account that shows how many of the cost-related transport containers from Urban-Transporte have not yet been returned.
In addition to collaboration with SAP, “global cooperation for complex automated warehouses,” the special expertise of the LES partnership with SAP, and the success of Siemens L&A in implementing LES from SAP have proven the company’s competence in integrating logistics systems with manual and completely automatic systems.

Richard Beer
Richard Beer