Operational Improvement of Nissan’s parts warehouse

Abstract

The Rosslyn parts warehouse is Nissan’s sole supplier of parts to all dealers throughout South Africa and sub-Sahara Africa. Management is currently concerned about the effectiveness of the warehouse operation, demanding a comprehensive analysis of the activities and practices. Emphasis should be placed on improvement of the receiving and picking processes.

The aim of this project is to analyse and improve the operations and layout of the Rosslyn parts warehouse. All operations and processes were analysed to ensure optimum flow of parts throughout the warehouse. These operations include all activities from the receiving of parts to the picking and distribution. Some key deliverables include the investigation of best practices in warehouse operations. Industry visits and a literature study on warehouses can help to determine the best practices applicable to Nissan. Some include placing the most popular items closest to the picking/shipping area. Develop improvement alternatives for layout such as space planning plays an important role in the final layout. Consideration of popularity, similarity, size and material characteristics should be addressed to develop a layout that will maximize space utilization as well as an acceptable service level. After implementation of the improvements, the picking operation is expected to be improved from approximately 28 to 82 Lines Per Man Hour. This was achieved by placing a roller conveyor next to the mezzanine and linpic areas to convey picked parts to the shipping area. As well as install three Vertical Lift Modules (VLM) in the mezzanine area, which will be used to house the top 20% of parts. In the H-area, automated picker routing was introduced to minimize the sorting time and optimise the picking route. The total cost of implementation amounts to around R 1 960 000. The payback period is just under three years, with savings in labour costs (a workforce reduction of four pickers) and damaged/stolen parts cost. The amount of picks per day has increased from 3200 lines per day to 9500 lines per day.