Optimizing Storage Space and Order Picking in Warehouse Operations: A Case Study of an IT Product Distribution Company

Abstract

This research aims and objectives are 1) to investigate warehouse storage and order picking systems; 2) to improve these warehouse processes for increased operational efficiency; and 3) to develop a relevant procedure manual for employees. With an operational experimental research approach, the case study highlighted an examination of an IT product distributor. The investigation encompasses exploring warehouse storage and picking process flow charts, brainstorming for problem identification, and the use of cause and effect diagrams. As results, the time employees spent on retrieving and searching for products was found to be longer than necessary due to lack of warehouse location storage numbering scheme, no racking location code labelling, no location-based inventory records and no manual for employees. The operational steps incorporated assigning micro and selective racking location codes, generating barcode labels to place on each location, and creating an operations manual for staff. Post-intervention effects revealed a significant improvement in warehouse picking efficiency. The average picking time of 315.53 seconds (5.15 minutes) per item declined to 137.36 seconds (2.16 minutes). Therefore, the picking time decreased by 178.17 seconds (2.57 minutes), accounting for 56.46% time reduction. Additionally, the operations manual plays a noteworthy role in increasing employee productivity and efficiency in the workplace.