One of the members of the board of directors or a principal of your firm has just visited a competitor’s automated facility and wants to know if automated material handling equipment is appropriate for your firm. Would you know how to help top management decide?
Automated material handling equipment systems have been around in one form or another since the 1950’s. Different degrees of automation success have been achieved in a variety of applications. Horror stories as well as truly excellent installations abound, sometimes within the same company. How do you go about the process of evaluating automation?
GETTING STARTED
First determine which material handling operations should be considered for automation.
- Receiving?
- Putaway?
- Replenishment?
- Picking?
- Shipping?
After you have decided which material handling operations are candidates for automation, develop a database of operating histories and requirements for the operations you are considering. Automation should only be considered if the stability of the following factors is predictable:
a. Corporate structure
b. Operating requirements
c. Order characteristics
d. Unit load size
e. Carton size
f. Location network configuration
WHEN PROPERLY ANALYZED AND IMPLEMENTED, AN AUTOMATED MATERIAL HANDLING SYSTEM CAN GIVE YOUR COMPANY A COMPETITIVE EDGE.
If you cannot project a "stable state" for the operation, automation becomes much riskier.
DEFINE SYSTEM REQUIREMENTS
The process of defining what you want the system to accomplish is probably the most tedious task in the process. If you cannot define the system requirements for a particular task you are trying to automate, stop and reconsider automation. You cannot automate what you cannot define. Include your management’s payback hurdle rate as part of the system definition.
VISIT SIMILAR APPLICATIONS
When you have defined the system, approach three or four qualified material handling equipment vendors. Familiarize these vendors with your system requirements and ask them to arrange for site visits and telephone conversations with installed users. If a vendor cannot arrange for you to visit a satisfied user, reconsider using this vendor’s system.
OBTAIN DETAILED BIDS
After you have "qualified" the appropriate vendors, request detailed bid packages from them. In addition to prices, these bid packages should include detailed drawings, information system support requirements, system capacities, installation schedules, start-up assistance required and provided, acceptance test procedures, service agreements and warranties.
EVALUATE THE BID PACKAGE
The process of evaluating the bid packages must be approached very carefully. The vendors will have spent considerable time, effort and money preparing these packages. Your company is going to spend considerable time, effort and money implementing the automated material handling equipment system if it decides to proceed.
A system that does not work properly will not only not improve your operations, but may, in fact, impede them. Therefore, selecting a vendor based solely on price is asking for trouble.
The financial stability and reputation of the vendor and of any subcontractors they plan to use should be high on the list of evaluation points. Before making a final decision, the system should be thoroughly tested using computer simulation. The simulation should be prepared by an independent party - not by the vendor.
IMPLEMENTING THE AUTOMATED SYSTEM
When the process of choosing a vendor has been completed, the real implementation work begins. Insist on close coordination between your project team, your software development team, and the vendor’s team. Treat the vendor’s team as a partner. Establish a detailed implementation schedule immediately and monitor it closely during the entire process. Insist on definable milestones for hardware and for any associated software development.
Prior to start-up, detailed procedures must be written and your software must be documented and tested. Detailed procedures will be the basis for training the personnel involved in using the new automated system. Proper training is the key to success at this point.
Documentation and testing of your software should focus on the elements which drive the mechanical controls as well as those which provide information to the system. Make sure you receive complete system documentation from the vendor. Prepare a good test plan with clear predicted results. Allow sufficient time to complete adequate testing procedures.
After the acceptance test and shakedown period are over, an assessment should be made of how to make the new automated system more effective for your operation. Note any changes needed and obtain vendor’s agreement to make them.
SUMMARY
Automating material handling operations is high risk/high reward situation. When properly analyzed and implemented, an automated material handling system can give your company a competitive edge. When not properly analyzed and implemented, an automated material handling system can become your worst nightmare.
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