March 1, 2003
operations insight | DC Service & Maintenance

Down but never out

down but never out

Even the best-run DC requires some downtime for equipment maintenance. The idea is to avoid those heart-stopping unscheduled shutdowns.

By Keith R. Schmitz

Somewhere in America, a consultant is getting a call from a DC in trouble—maybe productivity has tanked or inventory has hit critical mass (or critical mess). In any event, something is not right. The problem? Contrary to what you might expect, it's generally not a matter of obsolete equipment, malfunctioning systems, or supervisors from the Simon Legree school of management. Inevitably, says Tompkins Associates consultant Brian Hudock, who has answered a few of these SOS calls, the problem turns out to be something distinctly unglamorous: poor maintenance.

At more centers than you might expect, systems and equipment get serviced only when they go down. At others, preventive maintenance is done but the effort is less than scientific and the intervals are anything but precise.

Granted, scheduling routine preventive maintenance is difficult in times when customers are demanding made-to-order products and expect lightning fast Internet order fulfillment and 24/7 shipping. But as more companies try to eke another year or two of service out of their aging equipment, DC managers need to stay on top of the routine upkeep duties or risk the unthinkable. What follows are several often-overlooked ways DC managers can avoid that breakdown dead ahead.

  • Look at your wear-and-tear patterns. It might not be the first thing that occurs to DC managers when they're considering ways to keep equipment in good working order, but the facility's floor plan may be hazardous to your equipment's health. Long travel distances may be causing m ore wear and tear on your equipment than is strictly necessary. Tom Tanel of CATTAN Services Group Inc. recommends reducing the travel distance for products within the facility as much as possible and putting in place reverse logistics strategies that reduce returns. "The less of ten things are handled in a DC," he notes, "the less chance for equipment wear."
  • Make employees accountable for the equipment they use. By assigning people to specific pieces of equipment, management is better able to track how it is used—and abused, Tanel says."Research consistently shows that 80 percent of equipment damage is willfully caused by 20 percent of the crew," he adds.

    One way to discourage equipment abuse is to attach economic consequences. When equipment damage occurs at the Crate and Barrel DC in Naperville, Ill., the operator is written up and suffers a slight reduction in his or her hourly rate, reports Dan Degross, the facility's manager. A good driving record, by contrast, earns the employee "safety dollars," which can be used in the Crate and Barrel stores or in the center's on-site cafeteria.
  • Come up with a system—a warehouse management system. You'll never know if equipment needs a tuneup if you don't keep track of usage and performance. At the Crate and Barrel DC, clipboards hang on the wall adjacent to the forklift parking area with forms in both English and Spanish. The facility requires drivers to log in when they use a forklift, and managers feed all the performance information into a computer system at the end of the shift.

    A computer system, typically a warehouse management system (WMS), can provide a detailed look at how individual components are performing "In the past," notes Larry Bandstra of supply chain consultant Sedlak, "we had to look at the aggregate." But today, a WMS can automatically compile a history for each piece of equipment as it goes out on the floor or as product passes along the conveyor.

    Companies that want more—that is, oversight of the whole process—can use a machine control system like Fortnaplus, from supply chain consultant Fortna Inc. That package monitors the performance of material handling systems, such as conveyors and forklifts, and provides a continual flow of information, stockpiling performance data and tracking preventive maintenance intervals. It also allows technicians to track the performance of computercontrolled components via monitors located throughout the DC.

    The Fortna plus system also lets users investigate on going problems. For example, if a conveyor has low read rates, a printout will enable technicians to determine if a dirty canner, an out-of-position scanner or a poorly applied bar code is causing the problem. Of course, not all problems are physical: According to Dan Granville of Fortna, one of the biggest problems his company deals with is software issues. Malfunctioning programs can cause jam-ups in a conveyor system.
  • Get help when needed.No matter how good your maintenance crew, chances are it can't do the job alone. Sometimes a little help from the equipment vendor is all that's needed. For example, TNT Logistics relies heavily on its own on-site maintenance crew to service its network of 208 third-party DCs in the United States, Canada and Mexico. But if a particularly knotty problem develops, the company doesn't hesitate to call in the manufacturer. In fact, when purchasing equipment, says Mark Johnson, TNT Logistics' vice president of quality and development, the company looks for equipment vendors it can count on for prompt service.

    Other companies opt to hand off the maintenance chore entirely, outsourcing the responsibility to a provider like HK Systems. HK Systems offers services that range from help-desk support for equipment and software all the way to completely replacing the DC maintenance department, says Todd Sermersheim, the company's vice president of customer service. One advantage of using a maintenance specialist like HK is the equipment performance database it has built up through its experiences with other customers. That knowledge plus close contacts with equipment manufacturers means the maintenance technicians have access to information no single company can acquire on its own—a valuable commodity when time is short and the stakes are high.

About the Author

Keith R. Schmitz
Keith R. Schmitz is a Midwest-based writer who has written about and taught courses in the areas of supply chain operations, material handling and management.

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