MHI Solutions Improving Supply Chain Performance
It was the greatest compliment I’ve ever received.
Our team was giving a tour to a group of customers when someone noticed that the material handling equipment went in and out through different buildings. They asked whether the building and equipment had been built and installed at the same time since it appeared very integrated. In reality, it happened over 15 years, built upon a foundation of hard lessons learned.
At the start of my career as an industrial engineer, I was involved in designing facility layouts. Over time, I advanced to chief supply chain officer. As I took on all the operations, I was able to see how the decisions we had made, years prior, affected repairs and maintenance, flexibility for new product lines and integration with new kinds of automation. There was one moment where, as our business grew, we needed more speed out of a certain portion of the conveyor. We had made a choice many years previously to purchase a slower type of sorter because we couldn’t imagine that we’d ever need more speed in that area, given our 10‑year growth plan.
Experience was the best teacher. What I learned to do, since we had the opportunity to redesign our layouts, was to ask, “What is the most likely part of the operation to expand or contract in the future?” This is especially important when you are installing new material handling equipment in a new or existing building. It is important to imagine how the business could evolve over the next 30 years, and to take that into consideration when designing for growth.
I’ve recently taken on the role of chief supply chain officer at Barnes & Noble. Barnes & Noble is on target to open over 60 stores in 2024 and is on a similar trajectory for 2025, and with that growth in mind, I’m excited to incorporate what I’ve learned about material handling design principles to ensure our process flows and facility layouts are right for today, as well as years into the future.
These days, if you can describe how you want to perform a task or function in your distribution center, there’s probably a machine, robot or application that can assist. I left the last ProMat amazed at how fast technology is expanding, and I know I wasn’t alone. As you explore all that new automation and imagine how to use it in your facility, take a step back and think about your total layout.
A future‑oriented layout and design needs to be imagined in the context of not simply a five‑ to ten‑year ROI or depreciation schedule. The current data and profile of your product and goods in your supply chain may not be exactly the same in the future. Assumptions about the future must be robust enough to account for organic growth, mergers and acquisitions, product changes, technological advances in material handling systems, robotics, etc. Material handling systems don’t get replaced as soon as the ROI is met! These systems can last decades.
As you embark on purchasing new material handling equipment, my advice is to add one more step to your layout design process. It only takes about an hour or so with your leadership team, and it’s a fun exercise to imagine the future. In that meeting, show everyone the layout and explain which areas would be easier or more challenging to move, expand or change in the future. Then talk about the business, and ask all kinds of futuristic questions like, “How many ship‑to locations could we replenish to in 30 years?” “What could be the future mix of product?” “Would we ever change our inventory strategy?” “Would we ever acquire another company?” “Are there technologies on the horizon that we might install?” As you ask these questions and more, a few key assumptions will emerge, and you’ll figure out where a change would greatly affect a future layout design. In my example, the speed of the conveyor in a 30‑year model might have led us to choose a different kind of conveyor.