Controls for Advanced Warehouse Systems

Additional technology and management concepts can be built on top of the basic computerized perpetual inventory tracking system described in the last section to improve the overall level of efficiency while also reducing the amount of manual transaction processing. However, since so many dif­ferent systems are in use, they are not described here as a single integrated system. Instead, each one receives a separate description and set of associ­ated controls. The systems are described next.

  • Bar code scanners. Under this approach, the warehouse staff creates a bar-coded part number for each item as it enters the warehouse and at­taches the bar code to the item. It also creates preset barcode labels for each warehouse location and posts them at each location. Anyone mov­ing stock then scans the part number bar code and the bar code for the location to which it is being shifted and manually enters a quantity and transaction code to complete the transaction. This information typically is entered on a portable scanner that can be placed in a cradle to upload batched information to the central computer system or used in real time with a built-in radio to transmit and receive transaction information. Related controls are described next.
  • Print part description on bar code labels. A major risk with a bar-coded scanning system is that the bar code label contains an incor­rect part number, which will then be scanned multiple times as the item to which it is attached moves through the warehouse. To make it easier to detect incorrect bar codes, always include the item de­scription on the bar code label, which should print out just below the bar code.
  • Laminate warehouse location tags. The bar-coded tag identifying each bin location in the warehouse can be subject to a great deal of abrasion from forklifts and other materials-handling equipment, re­sulting in damaged bar codes that cannot be scanned. To avoid the risk of having the warehouse staff manually input the location in­formation (with the attendant higher risk of data entry error) into their bar code scanners, laminate all location tags to increase their durability.
  • Regularly review location tags. Given the durability problems with location tags as described in the preceding control point, it is useful to conduct a regularly scheduled review of all location tags to de­termine which ones should be replaced. This is also a good way to determine if inventory is now being stored in locations where there is no identifying tag at all, so that tags can be created for those locations.
  • Require specific character lengths for scanner data entry fields. En­tering an inventory movement transaction in a bar code scanning de­vice will require several entries: for the item number, bin location, transaction code, and quantity being moved. If the scanner accepts character strings of any length in each of these fields, it is quite likely that the materials handling staff will enter scanned and keypunched information into the wrong fields. To avoid this, set up the scanner to allow specific maximum character strings in each field. For ex­ample, eight digits may be both the minimum and maximum char­acter string for a location code, while ten digits is required for an item number, and nothing over four digits is allowed for quantities. As an additional control, always use different numbers of characters for lo­cation codes and item numbers, so they cannot be confused with each other.
  • Require scanner uploads at all scheduled breaks. If the materials handling staff is using batch-mode scanners that must upload their contents to the central computer, require the staff to put the scanners in their upload cradles whenever they have scheduled breaks. This prevents an excessive amount of information from being stored in the scanners while also keeping location-specific inventory counts more accurate.
  • Assign picking and putaway responsibilities by aisle. Since bar code scanning requires the materials handling staff to both move items and record transactions, it is possible that the staff will forget to conduct scanning transactions in the midst of other duties. To track down which employees are most likely to not be completing their scanning chores, assign picking and putaway responsibilities by aisle. By doing so, errors found through cycle counts can be traced more easily to specific employees.
  • Cross-dock inventory. Under this approach, items arrive at the receiving dock and are moved immediately to a shipping dock for delivery else­where. This approach eliminates inventory moves into a storage rack as well as subsequent picking and movement back to the shipping dock. Related controls are described next.

Use warehouse clerks for all data entry. When the materials handling staff is responsible for recording both receiving and shipping trans­actions, as well as moving the physical goods, it is entirely likely that they will occasionally forget to record transactions. To avoid this problem, concentrate all transaction-recording tasks with warehouse clerks whose sole responsibility is to ensure that receiving and ship­ping transactions are properly recorded.

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