1. Applying Lean Principles
in Warehouse Operations

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The Lean Principle
Lean principle advocates completely waste-free operations
Focuses on value as perceived by the customer.
Most commonly applied in manufacturing
Interesting to apply the lean principle for warehouse operations
and gain competitive edge

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Importance of a Warehouse
 A vital cog within logistics, warehouse holds high potential for
improving lead times, reducing logistics costs and creating
competitive advantage.
Challenges for a Warehouse Manager
 To increase productivity and accuracy.
 Adapt to ever changing market dynamics such as evolution of new
channels, reduced lead times, high SKUs etc.
 Maintaining lower inventory levels.
 Optimizing the resources viz., storage space, labour, material
handling equipment etc.
 Meeting customer demands and fluctuations.
 To improve customer satisfaction while reducing operational costs.
Warehouse Importance & Challenges

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To create a lean warehouse, the following are the prerequisites
a) Foresight
b) Preparation
c) Documentation
d) Analysis
e) Appropriate Strategy
f) Continuous improvements
Most importantly, build self-awareness and understanding of
each person’s role in warehousing operations and the
importance of uninterrupted value flow in the system.
Pre-requisites for a Lean Warehouse

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FOCUS AREAS TO TRANSFORM INTO
A LEAN WAREHOUSE

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The material storage and handling can make or break the
warehouse operations
Inefficient methods should be replaced by throughput-oriented
efficient facilities
Optimized storage results into following benefits
 Smoother flow of inventory & operations
 Optimized inventory
 Optimized resources such as labour, material handling
equipment etc.
 More space for holding & handling inventory
 Meeting customer commitments and higher customer
satisfaction
1. Material Storage and Handling

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Unnecessary movement of items inside warehouse add to
 Operational cost
 Labor costs
 Material handling equipment cost
 Warehouse rental cost
 Lighting and electricity cost
 Higher lead time and lower throughput rates.
With an efficient warehouse storage layout, one can have fast-moving
products in the front, slow ones at the back. With this, time taken
for locating, picking and packing items will also be drastically
diminished.
2. Internal transportation

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 Successful inventory management ensures availability right product
in right amount and keeps track of existing inventory and its
movement.
 Inventory should not only be available in adequate amounts but also
be easily visible and accessible.
 The most efficient inventory management strategy is the just-in-time
method.
3. Inventory Management
Key benefits of Inventory Management
 Improved product life
 Reduced Inventory carrying costs
 Improved agility to respond to varying demand
 Increased picking speed

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Factors influencing people movement and their efficiency in a
warehouse are
 Operational layout of warehouse
 Effectiveness of work stations
 Processes involved in picking and packing
 Movement of material handling equipment.
If a particular movement of people is wasteful, it will lead to loss of
productive time and resources. In case of manual picking and
processing, multiple handling will lead to inefficiency and a risk of
items getting broken or damaged.
4. People Movement

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 Any delay in order processing has a negative impact on entire
warehousing operations.
 Delays in people, systems and material, and waiting for
replenishment, etc. should be avoided to achieve high
productivity.
 Warehouses incur the cost of wages and all the fixed costs of
warehouse and equipment rents, lighting and heating etc.
Hence, it’s important to avoid any delay.
5. Delays

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 Leads to excess inventory
 Incurs costs on resources such as storage space, preservation
and their management.
 Causes tied financials
 Affects competitiveness of the company
6. Over-production/Over-processing

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 Any action that results in repeats and corrections, such as
inventory inconsistencies, billing errors, damaged materials, etc.
add to wastage that can and should be avoided
 Stop and fix as soon as something goes wrong – defects are
easily identifiable very close to the point of origin.
 By addressing the root cause of the defect immediately and not
accepting nor passing on defects, subsequent problems can be
avoided and overall product or service quality improved.
7. Defects

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Conclusion
Designing and implementing lean warehouse operations not only
brings control, visibility and delivery stability but also reduces lead
time, releases financial stress by enabling a high inventory turnover
and ultimately reduces the cost to the total logistics output.
Contact SILVER LINING for an expert advice on your warehouse
storage and to transform it into a lean warehouse .
T: +91 40 2313 9000
E: sales@silverliningstorage.in

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