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Robroy slashes costs, increases picking accuracy with WMS system
"You can't pull from the wrong location. You can't
pull the wrong part"
Client
Robroy Industries,
www.robroy.com, Gilmer, Texas
Privately owned Robroy Industries is a world leader in the
PVC-coated conduit electrical equipment market. Founded in 1905,
Robroy has thrived through constant innovation. Its founders
might not recognize their exceptionally clean and well organized
brainchild today; the plant seems more like a well kept
technical assembly operation than one utilizing high-temperature
and chemical processes to PVC-coat fittings, conduit and pipe.
Robroy's employees are part of the decision making process.
According to the company's vision statement, all team members
are expected, encouraged and enabled to grow in skill and
knowledge.
Not satisfied with educating only its employees, Robroy does
something remarkable: it trains its customers. It created
Corrosion College (www.corrosioncollege.com)
to help customers and partners understand proven strategies for
corrosion prevention. The accredited workshop is conducted
monthly at Robroy's Gilmer, Texas headquarters.
"Solve a problem and then automate"
Robroy has always recognized the role of technology in
improving its operation, but does so in a results-oriented,
pragmatic way. It utilizes various technologies and automation
with a focus on reducing costs, enhancing customer service, and
increasing efficiency while marrying that to business process
and personnel practices.
"By putting in an automated system, you become accurate,"
said Robroy President and Chief Operating Officer David
Marshall. "But you just get bad information faster if bad
information is what you already have. An automated system won't
solve that problem. You have to solve a problem, then automate
the solution."
Robroy's goals were about business, not technology
Robroy's goals were to...
-
Slash operating costs, particularly indirect,
transactional and labor costs. "If you have exactly the same
amount of business, you should be able do it with fewer
people and transactions," said Marshall
-
Implement cycle counting and eliminate its annual
physical inventory. Robroy wanted the advantages in
immediacy, accuracy, and cost savings cycle counting
provides vs. annual inventory counts. "Cycle counting was
the number one issue for me," said Shipping & Receiving
Manager Charley Butts.
-
Obtain Real-time information. In the manual
system, when orders were shipped, the information was
entered into the system, but customer service and other
departments didn't have immediate access.
-
Ensure capacity to handle monthly business surges.
20% of Robroy's orders are shipped in the final 48 hours of
any given month. Robroy needed to improve its ability to
process that surge and slash the increased error rates that
came with it.
-
Improve order picking accuracy. "Accuracy was a
top priority," said Butts. Robroy had to reduce its error
rate and improve its ability to prevent future picking and
shipping errors.
-
Control the pace of work. Allocating labor and
when it would be utilized was a key goal. In the manual
system, all orders were printed and released to pickers,
essentially allowing them to set the work pace based on what
was in the queue. Robroy wanted precise management of the
order picking process.
"Preparing People's Minds for Success"
Robroy invited Dallas-based
CEI Logistics, the
consulting division of Cisco-Eagle, to assess its operations to
determine the business case -- if any -- for a Warehouse Management
System.
Robroy and CEI started by mapping existing processes to
identify current transactional volumes. In parallel, high level
"to-be" processes were defined to leverage standard WMS
functionality to reduce manual and/or redundant transactions and
increase real-time operational control. The reduction in
transactional volumes was converted to labor savings through
analysis. The savings identified formed the basis for WMS
return-on-investment.
The process focused on the minutiae of the process at the
front end. Then, a detailed requirement document was developed
for software specification.
"The right decision for us was all the preplanning," said Billie Traywick, Robroy's Vice President of Operations.
"The key was covering as much as we could."
The team wanted to accomplish its objectives within standard WMS
functionality and avoid the kind of expensive and time consuming
customizations that can derail a project. When the team defined
its business objectives, it was able to overlay them with a
software solution to compare software packages.
The final result was a WMS system more than 90% out of the box.
"CEI Logistics gave us a systematic approach," Traywick said.
"We had milestones to hit and we were looking for someone who
had the expertise to bring vendors to the table. We went through
our objectives in detail; the time processes, activities, and
that sort of thing."
"We did a lot of front end thinking on this system," added
Butts. "We ran through many different scenarios. What is this
going to do with this" How will it affect the material handlers"
They had to figure out a new way to do things."
A consultative approach that "didn't compromise"
CEI Logistics' partnership-based WMS implementation process
helps clients extensively document their processes and match
them to the right software solution. In Robroy's case, this
methodical process examined everything that might happen between
the time when a truckload of raw material hit the shipping dock
to when a load of processed orders were shipped out.
Processes and scenarios were mapped so that all the bases were
covered. "That's the sweat equity," said Marshall. "The
installation is incidental. It was hard work. CEI didn't
compromise its principles even though it would be the easy thing
to do. They wouldn't compromise their integrity just to get an
order.
'the most important thing that they did outside of vendor
analysis and selection was that they started to prepare our
people's minds for this," Marshall added.
"CEI was the right partner because they challenged us," added Traywick.
"It wasn't just a yes process. They would say "I don't
think you want that because of this, etc". I think you may want
to consider this. It wasn't just a matter of trading dollars for
hours. We got challenged."
"Writing that systems requirement document put things in a sense
of order," said Marshall.
Minerva WMS selected
The selection process led Robroy to select
Minerva's AIMS package due to its robust RF capabilities,
flexibility in regards to storage media, cycle counting, and
process control.
Training for success
Robroy makes a significant investment in training and
educating its employees, so it focused on training for its WMS
system.
 'the
purpose of all the pre-work," said Marshall, "was to rearrange
the behaviors so that they were consistent with the software as
opposed to making the software consistent with behaviors. Anyone
should be able to do it with five minutes of training."
"We're getting even better as the handlers become
comfortable with the system," said Butts. "When you're starting
on the system, you learn how to do it right. You get better and
better and better. They start to understand what's happening on
that gun. They're thinking ahead on the order picking gun."
The day the system went live, Robroy was able to operate
normally. "We knew there was success at the end of day one of
going live because we shipped stuff," said Marshall. "It did not
choke the organization. No customer realized we were changing
the system."
Cycle counting in, annual inventory out
Robroy was able to replace its annual physical inventory
with a robust cycle counting system that continues to yield
benefits.
In the manual system, Robroy relied on individuals to count a
row or set of parts. Cycle counting enforces the need to count
in real time. "We didn't know what got counted and didn't get
counted," in the manual system said Butts. "Cycle counting makes
sure that every single item in every single location gets
counted at some time during the year."
The benefits go beyond eliminating the annual inventory and its
labor costs. Cycle counting helps Robroy set inventory levels
and reduce labor costs. 'the system can tell us high movers, low
movers, etc.," said Butts. "It helps us cycle count more of the
higher volume items. If you have a part that's been sitting
there for three years it doesn't make sense to count it every
year and you count it over and over again and it never moves.
You eliminate that time."
'there are now inventory accuracy measurements," added Traywick.
"On a daily basis we can see the accuracy with and without
inventory adjustments. We can print that number anytime."
"With cycle counting," said Butts, "if there is an issue we
catch it much faster than a physical inventory would." Often an
issue is identified within days, rather than within months.
Handling 20% of all orders in 10% of the time
Twenty percent of Robroy's shipments occur in the last 48
hours of a month, creating a potential shipping bottleneck and
causing error rates to climb during this rush to fill orders.
Since WMS implementation, error rate issues have vanished.
Despite a series of record quarters, the influx of late orders
have been filled without additional headcount or impact to the
workflow.
"It doesn't stretch us," said Marshall. "Our error rates
used to skyrocket in the last three days of the month. That
increases transaction costs. Having the ability to ship twenty
percent of your business in ten percent of the available time
and maintain accuracy is significant."
Real information in real time
Since the WMS implementation, Robroy has improved customer
service without increasing headcount on a higher volume of
orders. 'the system automatically sends tracking information to
customer service," said Butts. 'they have real time access to
it."
The system ensures that customer service only becomes involved
in exceptions. Previously, an agent would have needed to
intervene in customer service situations that have either been
automated or eliminated by the WMS implementation. "We know
things as soon as the warehouse does," said Material/Service
Manager Donna Waterstraat. If there is ever a shipping error --
a
rarity these days -- we find it before the customer does."
"Information is visible to everyone," Marshall said. "Anybody in
this building, including me, can look at a customer's order and
know if it's shipped or not -- carrier and pro number. We're not
managing 90% of the orders. We're managing just the exceptions."
"If we stock it right, it's impossible to pick it wrong"
It is difficult to make a picking error at Robroy these
days. Butts believes that if a part is stocked right, then it
can be handled through the supply chain correctly, quickly, and
accurately.
"You can't pull from the wrong location. You can't pull the
wrong part," Butts said.
"WMS is more about accuracy than speed," Butts added. "You still
have to pick that part, you still have to box it, you still have
to put it on a truck and ship it out. You can do things faster
and smarter, and those things save time, but the biggest thing
it brings me is accuracy."
Slashing transactional costs across the entire enterprise
According to Marshall, the WMS system eliminates the kind of
indirect transactional costs across the operation that he needed
to slash.
For instance, an incorrect order incurs transactions across a
number of departments and involves multiple people. A shipping
clerk had to enter that order; a customer had to contact a
customer service agent; the agent had to correct it, and the
entire process had to be redone. This might involve accounting,
warehouse, customer service, and manufacturing personnel, all
doing work twice that the WMS system has -- at least in
part -- eliminated from the process.
"Lots of jobs shifted," said Butts, offering the shipping
process as an example. "Processing UPS shipments used to be time
consuming. You had to key in all the information. That's gone.
We're now locked into the UPS stream. That saves a bunch of time
on UPS orders." A dedicated parcel shipping clerk position was
eliminated due to the tightly integrated UPS system, seamless to
Robroy's business system.
In three record quarters since the system went live, Robroy has
managed to reduce those costs as well as others. It also freed
significant customer service time.
"It gives me more time to do other things," said Waterstraat.
Her team can focus on dealing with exceptions and providing
better overall service rather than dealing with errors or
finding information.
A constant workflow
Controlling the pace of work was important to Robroy. In the
shipping operation, this was particularly vital.
"Before the WMS we printed worksheets and put them in the
window," said Butts. 'the pickers pulled as much as they could
for the day. What didn't get pulled we had to cancel until the
morning. The pickers could pick and choose the job they wanted
to pull so we didn't have control of who was pulling what, and
when."
The WMS system changed the dynamic by giving Butts control of
exactly what is being pulled, when, and by who -- with easy access
to make changes. The system is set into zones, and the pickers
pull whatever is assigned to their gun.
Personnel schedules can be adjusted in advance for heavier
workload days with more foresight. "I can pull people out of
production to help pull conduit, pull parts, and load trucks,"
Butts said. "I can see what they have in front of them. I know
where the load is. I know what pickers are going to pull. I can
have a constant work flow without overloading people."
"The trend is that we can pick more, faster, and it's going
to be right."
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