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Moving to Speed dial.

Verizon Communications' Indiana facility doubled throughput and volume while cutting costs when it upgraded split case processing and direct fulfillment.

Making the right connections is the primary mission of Verizon. You might even say that this communications company is actually the result of a connection of its own. It's the new entity born from last year's merger of Bell Atlantic and GTE.

With the merger came a joining of distribution operations, now known as Verizon Logistics. This distribution arm is charged with providing the phone sets, tools, wire, circuit boards, transmission equipment, and other products necessary to keep Verizon's communications infrastructure running smoothly nationwide.

Its Westfield, Ind. National Logistics Center houses $50-million dollars of inventory that provides direct delivery to phone technicians in six states (Indiana, Illinois, Ohio, Wisconsin, Kentucky, and Pennsylvania). The NLC also ships products to other company-owned regional logistics centers, and serves commercial customers nationwide. It's a materials handling challenge, as products range from large coils of wire to the smallest diodes.

The Westfield facility, formerly a GTE DC, recently underwent a major upgrade that improved split case processing productivity, increased throughput capability without additional labor, and consolidated in-house inventories (Cisco-Eagle, Inc., Added were pick-to-light processing in a multi-level pick module, a sliding shoe sorter, and a warehouse management system (WMS).

"We were in a situation where we needed additional split case picking for technician-level fulfillment which required a different technology than what we had in place," explains Steve Morris, Verizon's manager of project implementation. "Our activity had just exceeded the capacity of the old pick line."

The number of stock keeping units (SKUs) in the facility increased from 6,000 to 8,000, and the WMS now provides complete visibility and accountability -- they know where a product is, who picked it, and where it is going at all times.

"I needed to be able to manage our productivity," says Pam Reeves, manager of the Westfield facility. "The WMS has been an invaluable tool for us, as it identifies our top performers. The results speak for themselves. We've doubled our throughput and our volume while we cut costs."

"It was a big step out of the box for this facility," adds Mark Aberle, supervisor of quality management. "The whole process flow is now more manageable."

Ringing them up

Commercial carriers, supplier's dedicated fleets, and parcel carriers deliver products to Verizon's 14 receiving doors. A worker removes the packing slip from each incoming carton and keys them into a nearby terminal to notify the WMS of that item's arrival.

An adjacent printer produces a put-away label that is attached to the carton or pallet. The label is then scanned, prompting the WMS to determine a storage location in the bulk floor area, the very narrow aisle pallet rack storage (VNA), or the pick module.

A small quantity of very slow moving receipts is also directed to putaway in shelving. These are primarily replacement parts for older equipment. Additionally, bar stock and wire reels are also received. The bar stock is stored on cantilever racks located at the extreme end of the building, while wire is stored on racking at the opposite end.

Items for the bulk floor storage are taken by lift truck to areas located on both sides of the DC. Most of these are high-volume movers that can be stacked several pallets high. Also stored here are oversize items.

Two types of products are stored in the VNA racks, full pallets and individual cartons. Loads are first taken by lift truck to pick up and delivery stations located along the ends of the VNA aisles. The WMS then directs narrow aisle trucks and order pickers via radio frequency to pick up pallets for transport to assigned storage locations.

Cartons find a home in the high-density area that features 30 in. spacing between rack decks. These are normally less-than-pallet-load SKUs that are slower movers than items delivered to the pick module. The locations and cartons are scanned as each case is placed directly onto the wire decking

Full pallets are also deposited into VNA racks. This area holds SKUs picked in a variety of quantities and frequencies, but usually less than a full pallet. Again, the WMS assigns the putaway locations. Items that most often replenish the pick module are placed in VNA racks running within the two-level picking module. Others are spread throughout the VNA racks that flank the module.

Fast-moving cases are taken by lift truck directly to the pick module where they are deposited into flow racks.

"We used to replenish the pick modules from only the VNA racks, but we ye tried to eliminate the doubling handling," says Reeves. "We receive it and now it goes right to the pick module if that replenishment is needed?"

Replenishment of SKUs not received that day still occurs with products being moved from the VNA racks to the modules. About 20-30 consolidations are also performed daily within the modules and the VNA racks. Typically, product is re-slotted based on velocity or combined with other same-SKU items.

Answering the calls

Order fulfillment is conducted in waves based on specific carrier delivery routes. Most pallet and full case picks are performed for telephone company customers, the regional logistic centers' needs, and commercial clients. Pick ticket/labels provide selection assignments to workers within the bulk and VNA storage areas.

Pallets and cases pulled from the bulk level storage area are taken by lift truck to staging lanes located between the shipping sorter and the dock doors. Signs with location bar codes hang above each lane. The lift truck driver scans the sign as the load is dropped to confirm proper placement. These items will later be consolidated with products brought from the pick module and the VNA racks.

Order pickers and swing reach trucks are wire-guided in the VNA rack. A worker first scans the pick ticket and is shown the location of the items needed on the truck's on-board display screen, either in the pallet racks or the high-density carton storage area.

Upon arrival at the correct rack, the worker pulls the case, scans to confirm the pick, plains the shipping label from the pick ticket on the case, and places it onto the outbound pallet on the truck. When the pallet load is complete, the worker takes it to the delivery station at the end of the VNA racks. From there a lift truck receives the load and takes it to a stretch-wrap station. The unitized load is then taken to an outbound staging lane.

Some 79% of the total picks within the DC are performed in the two-level pick module. Most are made directly into returnable plastic totes that are sent to field technicians. Some totes will also go to the regional logistic centers, and a very small quantity of picks are also placed in cartons for delivery to company-owned phone center stores.

The area currently contains nine pick-to-light zones, but the zones can be reconfigured as required. The equipment itself can also be changed from carton flow to pallet flow racks as SKUs demand. Carousels can additionally be accommodated if storage needs change.

The process begins in the first zone when a worker scans the tote license plate. The WMS then assigns a specific order to that tote. If any picks are required in the first zone electronic displays with quantity indicators light adjacent to SKUs that need to be picked. A second display shows the tote license plate number to confirm that those picks are intended for that tote. Once all picks in the first zone are complete, the tote passes to other zones requiring picks, where the tote license number is again displayed, as are the SKU lights and quantity indicators. The addition of pick-to-light has been a big plus for the facility.

"The advantages have been phenomenal," says Morris. "The people here had limited experience with automation, so delivering a highly reliable system that was user-friendly was an important design consideration."

Upon completion of all picking, the tote is transported up an incline to the sliding shoe shipping sorter. This unit sorts to 12 diverts based on carrier routes. In a nice space-saving move, Verizon placed a cage containing spare equipment parts and supplies under the sorter, making those items handy for standard maintenance.

Another creative use for space is above the dock doors. Morris installed above-door racks to store items such as empty pallets and totes.

Once totes pass through the sorter, they flow down long accumulation lanes to processing stations where a shipping label is attached to each tote. The worker then stacks the totes onto pallets staged behind the processing stations. Products will ship directly to the technicians in these totes.

Completed pallet loads are taken to the adjacent staging lanes where they are consolidated with products placed there from the other storage areas. Four or five lanes are reserved for each outbound dock door. The 39 doors are permanently assigned to specific customers or routes.

Verizon also ships a limited quantity of SKUs directly to consumers. These are phones, DSL modems, and other telephone-related products. Selections are made in the pick module into totes that are diverted by the sorter to a direct marketing lane. The items are removed from the totes and repacked into outbound cartons. The cartons are then placed on adjacent flow racks used to stage and consolidate orders until ready for shipping by small parcel carrier.

Another direct-to-consumer area is known as "direct fulfillment." These are for very hot items that are often sent to consumers ordering new services, such as caller ID boxes. These items do not flow through the pick modules, but instead are pulled directly from the bulk storage and VNA racks and taken to an automated pack and labeling station. From there they are taken by lift truck to an outbound postal shipping lane.

Listing the right numbers

The new automation has doubled output and nearly tripled the hourly pick rate, allowing Verizon to do much more same-day picking while pushing cutoff times back by 2 hr. Reconfiguring the facility layout returned another 60,000 sq/ft to storage space.

Employee involvement was also critical to the success of the project, as many workers volunteered overtime hours over a holiday weekend to complete the accelerated schedule (120 days from design to production). Facility associates have also been very responsive to training initiatives, and strive for constant productivity increases.

"The people do not just work here," says Morris. "They've taken ownership of the operation."

Reeves adds that the upgrade has made substantial improvements in the facility's operations.

"We're very pleased. Our quality and throughput have improved, we are providing better service to our customers, and we have improved the skill sets of our employees," she says.

Morris also believes that being a part of Verizon has a great upside for the Westfield facility. He says the company's new logistics organization will build on the distribution strengths of the former GTE and Bell Atlantic operations.

"I see the merger as a huge opportunity for us," he says. "The proven technology and resulting improvement in processes demonstrated in Westfield will be leveraged across Verizon. I see nothing but growth for us."


Consolidated inventory and two processes

Increased pick rates 260%

Full visibility and accountability gained

Volumes increased without additional labor

Split case SKUs increased 33%

Better storage utilization


Verizon Communications Westfield, Ind.

Began operation: 1992

Upgrade completed: November, 2000

Facility size: 310,000 sq/ft

Employees: 113

Orders shipped: 206,700/mo.
COPYRIGHT 2001 Peerless Media, LLC
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Copyright 2001 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Verizon Wireless' distribution arm Verizon Logistics
Comment:Moving to Speed dial.(Verizon Wireless' distribution arm Verizon Logistics)
Author:Maloney, David
Publication:Modern Materials Handling
Geographic Code:1USA
Date:Feb 1, 2001
Previous Article:Enhancing efficiency in the chain.
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