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Lean Retail Management-Desktop Research Solving Retail Problems
Lean Retail Management-Desktop Research
Solving Retail Problems
Topics
What is Lean Thinking? What is Lean Retail? Why Lean Retail? What does customer value Waist in retail store Customer store experience Benefits of Lean Retail Implementing Lean Retail Principles of Lean Retail Execution Retail Scenario-SAPWarehouse and DC Management (Lean WM)
Tesco’s Lean Supply Chain UK
Tesco can provide all the things one needs to run a household, literally from soup to nuts and everything in between.
What is Lean Thinking?
Value Stream
Empowered People
Value
Perfection
Flow & Pull
What is Lean Retail?
The Lean Retail approach centers on a number of Lean techniques:
Simplifying work design
Using pull to drive replenishment
Removing bottlenecks throughout the supply chain
Eliminating wasted:
Effort
Time
Materials
Motion
Womack, 2006
Lean Retail
Tools from the Lean Concept translate well into the retail industry
The Lean principles remain the same but the application may change
Focus on the value stream -
Get aligned
Get everyone engaged
Start with the customer
Creativity is the greatest resource
Silos are the greatest obstacle
Why Lean Retail?
Waste is seen differently in Lean: One of the stumbling blocks to Lean
is understanding the concept of waste.
Traditionally waste has been viewed as an object. It is very easy to envision a barrel of scrap and identify it as waste
In Lean thinking the term waste actually refers not to the physical material but rather the relationship of the resource to the end customer
Lean is all about identifying and eliminating waste
In Lean, waste is measured in consumption of resources – time and capital
Contents From :Lean_Retail_sample.ppt - Lean CEO
Benefits of Lean RetailMyths About Retail
Operations
McKinsey & Company
Lean Retailing Perspectives
It is impossible to provide better customer service
without increasing labor costs
We can’t predict customer demand, so we must be ready for anything
Product availability can only be improved through increased amounts
of inventory on hand
We would need a lot of capital to invest because this program may not
pay back for years
By giving stores more control, I lose network wide consistency and
standardization
Lean retail improves customer service and frontline employee satisfaction without increasing
labor costsOverall demand are highly variable,
many parts of it are predictable
Lean retail will reduce inventory and out-of-stocks
Lean Retail requires very little capital investment and consistently delivers
substantial impact through sales increases and cost reductions
Lean retail increases consistency and standardization while empowering
local management
Implementing Lean RetailCauses of Waste and Noise
Pro
du
ct
Focu
s
WFM
&
Effi
cie
ncy
Rou
te
Pla
nn
ing
Cate
gory
M
gm
t
Layou
t/P
lan
nog
ram
s
Pro
motio
n
Guidon Performance Solutions 2009
Principles of Lean Retail Execution
If your customers expect products to be delivered on trend, then eliminate obstacles such as extra handling and improve processes that are inhibited by poor workflow design. Plot the value stream. Identify and map all the steps involved in moving goods through the system, all the way to the customer. Activities that add no value should be eliminated. Make the process flow. Redesign processes that prevent the free flow of products to the customer. Pull from the customer. Lean execution requires a clear understanding of demand and current inventory, pulling merchandise to stores and to the shelf based on what customers want. Pursue perfection. Root out any remaining waste. Then do it again, and again, and again.
James Womack and Daniel Jones, authors ofLean Thinking:
Retail Scenario-Warehouse and DC Management (Lean WM)
Scenario This scenario describes the processing of merchandise in the
distribution center with inventory management done at the level of storage location – Lean Warehouse Management.
Benefits Since storage procedures depend on space limitations,
organization and the type of merchandise being stored, this scenario should be seen as one example of an implementation.
Key Process Steps Goods Receipt Processing Return Deliveries Goods Issue Processing Warehouse Physical Inventory Tools and Workbenches© 2011 SAP AG. All rights reserved.
Process Flow Diagram
Warehouse and DC Management (Lean WM)
Create Purchase
Order
Goods Receipt with Reference
to Rough Goods Receipt
Reta
il S
ale
s P
ers
on
Reta
il W
are
hou
se
Sp
ecia
list
Posting Rough Goods Receipt
Create Inbound Delivery
Process Flow Diagram
Warehouse and DC Management (Lean WM) – Return Deliveries (Optional)
Article document for goods receipt
Reta
il W
are
hou
se S
pecia
list
Output of article
document as goods issue
slip
Create Return
Delivery
© 2011 SAP AG. All rights reserved.
Process Flow Diagram
Warehouse and DC Management (Lean WM) – Goods Issue Processing
Create Outbound Delivery
Alternative 2: Confirmation with fifference
Ret
ail W
areh
ou
se S
pec
ialis
t
Alternative 1: Confirmation
without differences
Create transfer order as picking
document
Post goods issue
Mass processing of
outbound deliveries
© 2011 SAP AG. All rights reserved.
Process Flow Diagram
Warehouse and DC Management (Lean WM) – Warehouse Physical Inventory (Optional)
Create physical inventory document
Process physical inventory
Ret
ail W
areh
ou
se S
pec
ialis
t
Clearing differences
Alternative 1: Manual creation
of physical inventory
Alternative 2: Creation of
physical inventory via batch-input
Analyse physical inventory
© 2011 SAP AG. All rights reserved.
Document Flow in the Warehouse
GOODS ISSUEGOODS ISSUE
GOODS RECEIPTGOODS RECEIPT
FIXEDSTORAGEBIN
PUTAWAYTRANSFER ORDER
PUTAWAYTRANSFER ORDER
PICKINGTRANSFER ORDER
PICKINGTRANSFER ORDER
Outb. Del.Outb. Del.
POPO
Inb. DeliveryInb. Delivery
Rough GRRough GR
There is no stock keeping in Lean-WM,
but just recordingof movements usingtransfer orders.
optional
optional
Inventory Management - IM vs. WM
Storage LocationSite
Inventory Management on article level
Fixed storage bin can be maintained in the article master (text field)
No additional level of stock keeping below IM.
Warehouse number and type are just used for the recording of stock movements using the transfer order, but no stock posting is triggered when moving merchandise at this level.
Whose numberStorage type
Using Lean WM
When you implement Lean WM, inventory management takes place solely at storage location level. The system does not update the stock data at storage bin level using the quants like the Warehouse-Management-System (WMS) .
You use Lean WM solely for processing goods receipts and goods issues. Using Lean WM, you process the warehouse movements in basically the same way as if using the Warehouse Management System: you work with deliveries, and you create transfer orders for these deliveries. These transfer orders serve as pick lists.
The use of transfer orders in Lean WM provides the following advantages:
• You can reprint transfer orders at any time. • You can split transfer orders and thus distribute the workload better
among the staff in your warehouse. • You can use mass processing functions based on the transfer order (for
example wave picks).
© 2011 SAP AG. All rights reserved.
Mass Processing of Deliveries
Manual creation in the outbound delivery monitor using selection by:
Shipping point Picking date Route, carrier ... Free selection
Automatic generation using selection by: Picking date / time Additional filter by several criteria (e.g. route, shipping point, ship-to-party ...)
Considering capacity restrictions: Weight, volume Maximum items on the picking list Working time ...
Group of Outbound Deliveries
orWave Pick
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
Mass Processing of Deliveries
Collective Follow-On-Processing:
Create transfer order Confirm transfer order Post goods issue
Group of Outbound Deliveries
orWave Pick
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
© 2011 SAP AG. All rights reserved.
Rough Workload Estimate
Information on:
needed manpower needed transport capacity
Estimated Workload in:
Quantity Weight Volume Execution time
Calculation of workload using:
Logistics Load Category Unit of Measure Whse no. / storage type Warehouse process
Planned Goods Issue
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
DeliveryDelivery
Processes Goods Receipt and Return Deliveries
Processes Picking and Goods Issue
© 2011 SAP AG. All rights reserved.
Process Physical Inventory
References
SAP CISCO Lean Manufacturing in World Other Internet Reports and searches on
Lean Reatil
Overall 11 years experience in Retail Domain In Procurement ,Sourcing, Supply Chain Management Buying ,Merchandising, Category Management , Supplier/Vendor Management ,Retail IT, Process Consulting and Business Analysis. Depth knowledge of Retail & CPG Business Processes and its dependencies
Amit GargSr. Retail Functional Consultant
Email [email protected] Phone 09880641822
IM amitkgarg22 (Skype)
