{"id":57764,"date":"2024-09-17T13:52:24","date_gmt":"2024-09-17T17:52:24","guid":{"rendered":"https:\/\/www.flexpipeinc.com\/?page_id=57764"},"modified":"2025-05-21T14:44:55","modified_gmt":"2025-05-21T18:44:55","slug":"warehouse-lean-management","status":"publish","type":"page","link":"https:\/\/www.flexpipeinc.com\/ca_en\/warehouse-lean-management\/","title":{"rendered":"Everything You Need to Adopt Lean Warehouse Management"},"content":{"rendered":"\n
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Everything You Need to Adopt Lean Warehouse Management<\/strong><\/h1>\n\n\n\n

In today\u2019s business world, on-time deliveries have taken on an entirely new meaning. With the increased adoption of digital supply chains and mobile-optimized tracking, today\u2019s warehouses must react in near-instant-real-time with optimized material handling solutions. That means warehouse managers and logistics coordinators must eschew conventional warehouse approaches for faster, leaner, and less costly lean warehouse management strategies.<\/p>\n\n\n\n

When successful, lean warehousing strategies can reduce warehousing costs 20% to 50%<\/strong><\/a> by lowering inventory carrying costs, minimizing human errors, eliminating stock outs and improving delivery times.<\/p>\n\n\n\n

Want to learn more about implementing lean warehousing?<\/strong> Download our free 57-page guide: Lean Warehousing Mastery<\/a><\/strong><\/p>\n<\/div><\/div>\n<\/div><\/div>\n<\/div><\/div>\n\n\n\n

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Table of content<\/h2><\/div>
  1. Understanding Lean Warehouse Management<\/a>
  2. Lean Warehousing Principles<\/a>
    1. Value Stream Mapping<\/a>
      1. How Does Value Mapping Help Lean Warehouse Management?<\/a><\/li><\/ol>
      2. Just-In-Time (JIT) Inventory Management<\/a>
        1. How Does JIT Help Lean Warehouse Management?<\/a><\/li><\/ol>
        2. Continuous Improvement (Kaizen)<\/a><\/li><\/ol>
        3. Ready to start your lean journey?<\/a>
          1. How Does Kaizen Help Lean Warehouse Management?<\/a>
          2. 5S Methodology<\/a>
            1. How Does 5S Help Lean Warehouse Management?<\/a>
            2. 5S in Action: Robinson Innovations’ Journey to Efficiency<\/a><\/li><\/ol><\/li><\/ol>
            3. Benefits of Lean Warehousing<\/a>
              1. Implementing Lean Warehousing Practices<\/a>
                1. Step 1: Simplify the Value Mapping Process<\/a>
                2. Step 2: Define Your Warehouse Inventory Carrying Costs<\/a>
                3. Step 3: Gradually Adopt JIT Warehouse Inventory Management<\/a>
                4. Step 4: Kaizen and 5S<\/a><\/li><\/ol><\/li><\/ol>
                5. The Role of Material Handling in Lean Warehousing<\/a>
                  1. Improve Your Packing Station Efficiency with Lean Principles \ud83c\udfa5<\/a>
                  2. How Flexpipe Can Help Material Handling<\/a>
                  3. Examples of Flexpipe Structures for Warehouses<\/a><\/li><\/ol>
                  4. Top 12 most popular plans to download from the warehousing industry<\/a>
                  5. Inspirations from the warehousing industry<\/a>
                  6. Key Takeaways<\/a>
                  7. Endless Material Handling Customization with Flexpipe<\/a><\/ol><\/div><\/div><\/div><\/div><\/div><\/div><\/div>\n\n\n\n
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                    Understanding Lean Warehouse Management<\/strong><\/h2>\n\n\n\n

                    Lean warehousing is the process of maximizing resources and streamlining inventory and material handling processes to reduce warehouse operation costs. A lean warehouse uses continuous improvement methodologies like 5S, Kaizen and Just-in-Time (JIT) inventory management to improve efficiencies and eliminate waste. Adopting lean warehouse principles will provide your warehouse with material handling efficiencies by making all warehouse operation tasks easier, less time-consuming, and less costly.<\/p>\n\n\n\n

                    Lean warehousing strategies are a fairly new concept when discussing warehouse operation. However, lean principles like 5S, Kaizen, and JIT have helped streamline manufacturing and production for decades, playing a critical role in the emergence of the Toyota Production System \u2013 a manufacturing and business operations approach emulated by millions of manufacturers and companies around the world.<\/p>\n\n\n\n

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                    Lean Warehousing Principles<\/strong><\/h2>\n\n\n\n

                    Adopting methodical, proven continuous improvement methodologies is a must when looking to optimize your warehouse. It\u2019s the adoption of these continuous improvement methods and lean warehouse principles that provides the impetus for increased efficiency.<\/p>\n\n\n\n

                    The most common lean warehouse principles include 1) Value Stream Mapping, 2) Just-in-Time (JIT) Inventory Management 3) Kaizen and 4) 5S \u2013 which stands for Sort, Set in Order, Shine, Standardize, and Sustain.<\/p>\n\n\n\n

                    Each of these lean warehousing principles is explained below and is following by a simple step-by-step process for the implementation of lean warehousing.<\/p>\n\n\n\n

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                    Value Stream Mapping<\/strong><\/h3>\n<\/div>\n<\/div>\n\n\n\n
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                    Value Stream Mapping<\/a> is a lean solution where a flow diagram uses visual queues to outline the work tasks and material handling requirements that occur within a warehouse process \u2013 in this case, receiving an incoming shipment from a supplier, inspecting the shipment, unpacking, storing the finished goods on shelves, picking, repackaging for customer orders, preparing the shipment and then getting that shipment ready for delivery out to the customer.<\/p>\n\n\n\n

                    Cycle times for each material handling activity are defined in terms of how many warehouse employees are needed for a given work task and how long that work task takes.<\/p>\n\n\n

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                    How Does Value Mapping Help Lean Warehouse Management?<\/strong><\/h4>\n\n\n\n

                    Value mapping is one of the more important warehousing principles because it identifies backlogs \u2013 or waste \u2013 in warehouse management and material handling. The goal is to identify which material handling tasks have the highest cycle times and identify solutions to reduce those times.<\/p>\n\n\n\n

                    By eliminating unnecessary waste \u2013 be it simplifying material handling or eliminating repetitive process steps \u2013 warehouses can reduce the cycle times for each work task, become leaner, and ultimately, reduce costs.<\/p>\n<\/div><\/div>\n\n\n\n

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                    Just-In-Time (JIT) Inventory Management<\/strong><\/h3>\n<\/div>\n<\/div>\n\n\n\n
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                    Just-in-time warehouse and inventory management<\/a> approaches focus on eliminating the most common waste in managing inventory. While lean manufacturing is seen as a customer-centric philosophy that improves customer value by improving manufacturing processes, JIT is seen one of the more important lean warehousing principles that makes lean manufacturing possible.<\/p>\n\n\n\n

                    The essence of JIT is to have exactly the inventory you need to manufacture or ship a product at the exact time you need it. It requires a seamless integration of a company\u2019s supply chain so that suppliers provide the right quantities of parts, materials, or finished goods at the right time.<\/p>\n\n\n\n

                    To understand why JIT works and why it\u2019s needed within warehouse operation, it\u2019s important to understand the most forms of waste and costs that come with retaining inventory.<\/p>\n\n\n

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                    In non-JIT inventories, a company typically has an inventory carrying cost of about 3 percent of the value of their inventory in any given month. This 3 percent carrying cost comprises multiple different inventory wastes and excesses \u2013 which JIT focuses on eliminating.<\/p>\n\n\n\n

                    This 3 percent does not include warehouse employee wages, insurance, benefits, etc. It is solely focused on the direct costs attributable to the raw materials or finished goods on warehouse shelves.<\/p>\n\n\n\n

                    In conventional inventory management, companies hold inventory in anticipation of customer orders. However, the longer they hold that inventory the more impactful the inventory waste becomes. The most obvious waste includes financing. Companies borrow money from lending institutions like banks to buy inventory and store it on their shelves. Borrowing costs in today\u2019s economy are high, so the inventory waste (costs) of products sitting on shelves without being sold is also high.<\/p>\n\n\n\n

                    While financing is most definitely a waste of inventory, it\u2019s most certainly not the only waste. Inventory obsolescence is also a costly inventory waste. Having inventory that can\u2019t be used or sold either because of poor sales forecasts, changing customer preferences, or upgrades in product designs most often means obsolete inventory can only be sold as scrap. This is another warehouse inventory waste.<\/p>\n\n\n\n

                    Misplaced, lost, or damaged\/ruined inventory is another warehouse inventory waste. This is a common occurrence in warehouses with poor material handling practices. However, in general, the longer a warehouse must keep inventory the more likely that inventory \u2013 whether it\u2019s raw materials or finished goods \u2013 is likely to become damaged at some point. It\u2019s not uncommon for some warehouses to have inventory on the shelves for months and even years.<\/p>\n\n\n\n

                    Other warehouse operation waste relates to excess material handling movement. Inventory that is not properly forecasted or not available at the right time typically coincides with higher incoming and outgoing freight costs. Expedited incoming freight to cover low inventory counts and expedited freight out to customers to maintain delivery schedules are expensive costs. Not only are the freight costs high, but warehouses often must cover employee overtime.<\/p>\n\n\n

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                    How Does JIT Help Lean Warehouse Management?<\/strong><\/h4>\n\n\n\n

                    JIT is one of the more important lean warehousing strategies. JIT effectively reduces every aspect of waste within conventional warehouse inventory management. JIT reduces financing costs because inventory is only purchased when it’s needed. Companies aren\u2019t paying a daily financing cost just to have parts sit on warehouse shelves, waiting for orders. Material handling times are optimized as inventory arrives, is processed, and immediately used.  <\/p>\n\n\n\n

                    JIT also reduces the costs of obsolete and damaged inventory as only the inventory that\u2019s needed is received and used. That inventory doesn\u2019t sit on warehouse shelves long enough for it to become obsolete or damaged due to excessive material handling. In essence, JIT ensures high inventory turnover, and the faster inventory is turned over \u2013 the faster it is used or sold \u2013 the lower the waste and the lower the costs.<\/p>\n\n\n\n

                    Overtime and expedited freight are also lowered by adopting lean JIT warehouse inventory management. There\u2019s less incidence of overtime and expedited freight as incoming shipments are matched to consumption or customer demand.<\/p>\n<\/div><\/div>\n\n\n\n

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                    Continuous Improvement (Kaizen)<\/strong><\/h3>\n<\/div>\n<\/div>\n\n\n\n
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                    The continuous improvement philosophy of \u201cKaizen\u201d loosely translates from Japanese to English as \u201cgood change\u201d. It emerged from the Toyota Production System \u2013 or TPS. However, other influences also played a role.<\/p>\n\n\n\n

                    Borrowing aspects of statistical process control, process optimization, and analytical quality control, companies that effectively adopt Kaizen make it part of their culture. Kaizen is a belief system where warehouse managers, logistics coordinators, and continuous improvement managers are constantly focused on eliminating every form of process waste and material handling waste within the warehouse.<\/p>\n\n\n\n

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                    While there are multiple aspects to Kaizen, the most important for warehouse managers and logistics coordinators is Kaizen Teian \u2013 which refers to the every-second-of-the-day continuous improvements all employees should be encouraged to make. With Kaizen Teian, every warehouse employee focuses on making daily incremental improvements. Always mindful of waste, warehouse employees are motivated to bring up material handling process backlogs to supervisors so effective resolutions can be found.<\/p>\n<\/div>\n\n\n\n

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                    Ready to start your lean journey?<\/h2>\n\n\n\n

                    Our comprehensive 57-page guide walks you through :<\/p>\n\n\n\n