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Software Helps Floral Foam Warehouse Serve More Markets with Fewer People

"New distribution software helped us increase the productivity of every aspect of the distribution process, making it possible for us to serve more markets with fewer people," said Larry White, Materials Manager for Smithers-Oasis, Kent, Ohio, the leader in the floral foam industry. For competitive reasons, the company is not willing to reveal exact figures, but White said that productivity has increased by a double-digit percentage. The company's previous facility was run with a batch-oriented, paper-based system that was ill-equipped to provide the level of information needed to operate in a dynamic environment. When the company began to design a new facility next to its manufacturing plant, it considered 16 distribution systems before selecting one that provides real-time information that helps distribute tasks more efficiently and helps management keep its finger on the pulse of the operation. The new distribution system is integrated with the company's enterprise resource planning (ERP) system so that customer orders are immediately visible to the warehouse. Whenever inventory falls below a specified level, operators of turret trucks responsible for replenishment are automatically notified.

Prior to the invention of floral foam, florists used chicken wire and newspaper, clay or cedar greens as a base for floral arrangements. Delivering these creations was a gamble, due to sloshing water and rough handling in the delivery vehicle. Without a supply of water and nutrients, flowers typically lasted only a day or two. In 1954, at the age of 65, while experimenting with plastic foams, V.L. Smithers was glancing at a floral arrangement he had given his wife, when he thought, "If I could find a way to get water into foam, perhaps it would be used as a base for floral arrangements." He invented the product that is today called OASIS® Floral Foam. The invention of a water-absorbent cellular foam was the first of its kind in the floral trade and revolutionized the floral industry forever. Today, a typical brick of OASIS floral foam saturates in seconds and holds two quarts of liquid, representing more than 40 times its own weight. Smithers-Oasis Company continues to be the leading manufacturer and marketer of floral foams and floral foam accessory products in the world. The company is also the developer and leading producer of cellular growing media for the commercial greenhouse grower segment of the horticultural field. SKUs consist of cases of foam and other products.

In the past, Smithers-Oasis ran distribution from a leased 200,000 square foot low-bay facility located 15 miles from its manufacturing plant. The company printed out picking documents from its ERP system three or four times a day and distributed them to the shipping people. "The biggest problem with the old system was once the picking documents were distributed we had no way to receive feedback on how the picking process was going and make adjustments," White said. "We weren't able to balance the workload between forklift drivers, for example, so usually some drivers finished up early and had nothing to do for an hour or so while other drivers worked late. There was also no way to validate that items were being put away in the right place or that the right items were picked so mistakes were relatively common and they required extra work to correct." Other problems with the previous approach included the need to pay regular lease payments for the old facility and to shuttle goods from the factory on a regular basis.

New facility and software
Smithers-Oasis management began to consider building a new distribution facility on land adjacent to their manufacturing plant. This land was only 500,000 square feet and was bordered on all sides by a railroad track, river and other businesses so it could not be expanded. The need to provide facilities such as parking and meet zoning restrictions meant that any facility built on the land would have to have a much smaller footprint than the existing distribution center. The company began the conceptual layout for the current facility, which at 60,000 square feet and 40 feet tall is much taller than the last facility. The facility uses narrow aisles with pallet racking and employs Crown turret trucks that are guided by wires through the plant while the operator controls their speed and height and can operate through a 180-degree range of motion. The new design provides substantially greater distribution capacity than the old facility even though the footprint is much smaller.

As the design for the new plant was emerging, White and other managers considered what information system would be needed to keep it running efficiently. "We were happy with our ERP system from a manufacturing standpoint but felt that it didn't provide us with the level of information that we needed to run a distribution facility at optimum efficiency," he said.

Smithers-Oasis managers evaluated 16 distribution systems and narrowed down the field based on the systems' support for Windows, support for RF technology, ability to integrate with the existing Glovia ERP system and the level of technical support offered by their developers. The company selected VISUAL Distribution Center Management System™ (DCMS™) from Lilly Software Associates, Inc., Hampton, New Hampshire, because it excelled in all of the original selection criteria and was strong in other areas as well. "DCMS was easy to integrate with our ERP system, provides excellent RF support and was built from the ground up around Windows," White said. "Beyond that, we felt the management tools offered by the software, such as summary screens that let you visually track order status and workload in the warehouse, went well beyond the other packages." These summary screens are included in the DC Window, which Lilly Software refers to as an "executive dashboard." This full-color, graphical, zone-based window view of the distribution center offers intelligent messaging and active alert features. Any order in the pipeline is represented on the screen in its given zone, and any order in danger of being late is "red flagged."

"The implementation process was made more difficult by the fact that we were simultaneously putting in a new facility, new equipment and a new distribution system," said White. "Yet the process went relatively smoothly because we had strong support from the entire Smithers-Oasis management team and we developed a win-win relationship with Lilly. When we faced a problem, neither side stopped to determine whose fault it was. Instead, we all worked together to fix it."

The new system operates as follows. Customer orders are still entered into the ERP system exactly as in the past. With both the ERP and distribution system using the same Oracle database, bi-directional triggers are used to alert each package when a change occurs in the other. Managers keep an eye on orders, group them into waves based on various logical criteria, typically the shipping carrier and customer, and release the waves several times an hour. Those waves are immediately visible to the warehouse operators on radio frequency (RF) terminals. Whenever inventory falls below a specified level, operators of turret trucks responsible for replenishment are automatically notified. The software automatically converts the orders into picking tasks based on the location of the goods in the warehouse. It calculates an optimized route for the each picker and identifies the exact location of each product. These tasks are delivered through RF terminals that access the task screens in DCMS. Pickers use walkie/riders with electric pallet jacks to store the product. They pick the items, swiping each one to verify it is correct, and load them onto skids. As soon as the skid is completed, the software automatically dispatches a forklift truck to pick up the skid and deliver it to the loading dock.

The software coordinates the situation where orders require product from different picking zones. As the picks are completed in one zone and delivered to the dock, the turret truck operators delivering other parts of the order are notified of the location where it is being staged. The last turret truck operator to bring product for the order is automatically given the task of loading the order into the delivery vehicle. In the background, the software keeps track of the amount of each product in stock, periodically creates replenishment waves and sends the tasks out to turret truck operators. Managers receive continual real-time information including graphical screens with progress bars that provide information on how orders are progressing through the warehouse. Managers can easily drill down for information on specific orders or tasks.

"The new system is substantially more productive than the old one and the new software is one of the biggest reasons why," White concluded. "Operators no longer have to shuffle through stacks of paper to determine what to do next. As soon as they finish one task, the next task appears on their RF terminal. We spend much less time re-doing jobs because the operators confirm at every step by scanning pallet numbers and SKUs that they are doing the job right. Managers are also much more efficient because they can get all the information they need to do their jobs from looking at their computer screen rather than having to walk through the facility. When we first implemented the system, as you might expect, key indicators such as orders and cases handled per hour initially dipped below what we were doing with the old system. With a few months, however, we surpassed our previous level of efficiency and we are now ahead of the old system by a double-digit percentage.