Accurate order fulfillment is important in every distribution environment, but when the product is an artificial joint for scheduled hip replacement, it is important that the appropriate part be sent promptly. Centerpulse Orthopedics Inc. (Austin, TX) is one of the largest suppliers of musculoskeletal implants in the world. At Centerpulse's 15,000-square-foot distribution center, a staff of 20 people processes 150 orders per day for a total of 2,250 order detail lines. About 1,200 products are stored in a combination of double-high carousels, pallet racks, and shelving locations.
In 2000, Centerpulse learned its WMS (warehouse management system) would no longer be supported by its manufacturer. Centerpulse took this opportunity to add some functions not previously available. For one thing, the previous system did not support real-time visibility of product movement, lacked the ability to validate the accuracy of customer orders, and was very labor intensive in regard to cycle counting. Centerpulse began to evaluate systems that could improve inventory control, automate the distribution center, take over control of the carousels with a direct hardware interface, and provide RF (radio frequency) functionality for off-carousel operations.
"Our biggest need was lot control," says Becky Rohne, distribution system analyst at Centerpulse. "The system had to be able to be able to accept our lot numbers." A knee product, for example, has a specific part number that will always be the same. However, the second part of that number is a unique lot number that indicates when it was manufactured.
Centerpulse chose systems integrator Intek Integration Technologies, Inc. to oversee deployment of a new WMS system and the complementary hardware. Intek's Warehouse Librarian is an integrated WMS software package that provides a variety of functions from inventory management to labor tracking. The software divides the carousels into logical zones and automates the spinning of the carousels. Lots are tracked from the time of picking, and a complete history is stored in an Oracle database.
Warehouse Librarian's Consolidation application scans bar codes to identify totes and the orders they contain. This allows the operator to view the status of the order. With Productivity Tracking, Centerpulse can set labor standards and monitor picking, receiving, transfers, cycle counts, and other functions. Management can use Productivity Tracking to evaluate activity levels.
Centerpulse is using a pair of bar code printers from Zebra Technologies International, LLC (Vernon Hills, IL) to produce the appropriate labels. Centerpulse also purchased four RF terminals from Intermec Technologies Corp. (Everett, WA). In integrating the hardware and software, Intek worked closely with Centerpulse's IT staff, which did much of the initial design for the system.
Increased Pick Rates, More Accurate Inventory Records
Centerpulse increased pick rates by grouping multiple orders in a single batch as well as changing to parallel picking instead of pick and pass. Inventory discrepancies involving lot numbers, which had been a common problem, were reduced, as was the labor needed to manually reconcile the inventory database.
Replenishment operations have also been improved. Prior to the installation, manual replenishment required 15 to 20 hours per week, including manual review of replenishment reports. Stock returns have also been streamlined. Because a customer may order several sizes in order to ensure that the right implant is on hand at the time of the surgery or surgeries get cancelled, stock returns are very common. The amount of time needed to return an item to stock has been reduced from 10 minutes to a few seconds. In the future, Centerpulse is planning to implement a real-time "warehouse monitor" to set up user groups, granting access rights according to business rules.