Process improvement is widely recognized as an effective method for cost control. In fact, 70 percent of respondents in Logistics Management’s “Annual Warehouse and Distribution Center Operations Survey” say that they improved warehouse processes in order to lower operating costs in 2016.
But what if you had the right processes in place from the outset? You’d control costs, save time and improve service. Those are the results you can expect when you use DMADV, a Six Sigma management technique.
“The DMADV methodology can help to deliver integrated logistics solutions more quickly and cost effectively while enhancing quality and fostering innovation,” explains Mike Jennison, Director of Solution Design at Saddle Creek.
Putting DMADV into Practice
When a leading provider of skin care and nutrition products wanted to increase efficiency and improve service for order fulfillment, they turned to Saddle Creek. The 3PL used DMADV as a five-step framework to guide the solution design process, developing an optimal fulfillment solution from the ground up — including a new operating system and fulfillment automation.
Define. Saddle Creek’s solutions team first considered the customer’s needs and objectives, timeline, data requirements, and desired deliverables. Saddle Creek worked with the skin care provider to assemble a cross-functional team to avoid silos and ensure an integrated solution.
Measure. The team analyzed data in terms of business need. They identified and measured characteristics critical to quality (CTQ), product capabilities, production processes, and potential risks. Then, they developed control reports, high-level operational flows and solution concepts, and estimated facility size.
Analyze. Brainstorming and discussion helped determine racking needs, strategies for storing/picking, technology requirements, labor components, etc. Tapping the expertise of cross-functional team members and material handling integrators helped to identify the optimal solution.
Design. AutoCAD layouts, process flow charts, detailed spreadsheets, and internal-cost modeling brought the solution to life. The team then presented the solution to all stakeholders.
Verify. Pilot runs, going “live” with the production process, sharing operations feedback and reviewing financial performance helped to ensure the solution design’s effectiveness. Very little change was needed since so much attention was paid to detail up front.
The carefully engineered solution has significantly enhanced customer service levels. Today, the operation gets products from dock to stock faster, turns orders more quickly, and dramatically reduces delivery time.
For more background on leveraging DMADV for logistics solution design, read our blog post.