As an Industrial Engineering student, we study topics anywhere from making work environments more ergonomic to inspecting the quality of manufacturing processes, but the underlying theme of it all is efficiency. This term is where companies like Amazon can make a profit. They can upscale the market of shipping products by doing it faster and cheaper than anyone else. Efficiency can be applied to all business sectors from technology to human resources. Amazon capitalizes on efficiency by investing in robotics and utilizing the space in their warehouses in tried and true ways. Through my education in efficiency, here are some ways I came to understand Amazon's warehouse and how the company as a whole became so successful.
1. See it for Yourself
Amazon offers tours of their select warehouses, where a warehouse manager walks you through the different sections of the warehouse while explaining each step in the process. If you are a visual learner, this will help you tremendously in understanding the magic behind the scenes. My department of Industrial Engineering in college offered to sign us all up for a group tour. Taking advantage of this opportunity allowed me to see my major and Amazon's ability to embrace its principles to the max, in a new light.
2. Embrace Technology
The implementation of robotics into Amazon Warehouses was a huge investment and step towards improving its efficiency. These robots eliminate human error and remove the threat of fatigue in the warehouse along with improving the ergonomics of the warehouse workers' jobs. The robots are roomba-like in the way they move on the floor. Their job is to go under shelves, pick them up, and bring them to the person who then picks the items off that shelf that need to be sorted. Their job also includes knowing where to go at what time and to make sure not to interfere with another robot's path. Finally, this all has to happen in the most efficient way possible which includes choosing the shortest path to a destination along with other factors.
3. Understand the Importance of Reducing Waste
The Japanese word for waste is "muda" which first started being used universally when Japan introduced Lean Manufacturing into their Toyota warehouses. This was a revolutionary idea in the industry because it realized the importance of small improvements to the movement toward increasing overall efficiency. Another concept used alongside this is the Continuous Improvement Process where there is a constant strive to analyze and identify ways a process can be improved. Once changes are made, the process starts again to identify areas of further improvement.
4. Utilize Time as a Resource
Sometimes the first job as an Industrial Engineer is to perform Time Studies in a warehouse. This means observing the flow of the workers with a stop watch in your hand to collect data on the amount of time each work unit takes. The engineer then analyzes this data to find places where the worker's movements can be reduced to save time. Although this process seems like a very tedious job for a small reward, it can work wonders in the world of efficiency. If the engineer can make a change to the worker's job that saves three seconds and that task is done 24 times in the work day by 50 workers... well, you do the math. The point is that time is a resource that needs to be utilized efficiently.
5. The Layout of the Warehouse is Key to an Efficient Workflow
Since the idea of Lean Manufacturing is all about eliminating waste, it makes sense that a more organized warehouse improves efficiency. But the decisions to create a facility layout are more than just organization-based. I took a whole course in college called Facility Layout where we learned algorithms to determine the most efficient layouts to improve workflows and then do cost analysis on these new or improved layouts. In the Amazon Warehouses, the layouts and allocation of space to different operations is carefully thought out. The truck docking areas are in specific places in order to allow the packages to be sorted, packaged, and forklifted to the loading docks in the most preferred flow. The loading of the trucks with packages is algorithmically solved to ensure maximum efficiency of space and delivery time. To take a closer look into the theories and mathematical models of designing the layout of a facility, consider reading the following textbook, as it has a comprehensive approach to the ways facility layout problems are solved.
6. Barcode Tracking Systems are Essential
The massive amount of inventory inside an Amazon warehouse and simultaneously moving in and out at lightning speed is impossible to track manually. Amazon, along with other large companies use barcode tracking systems where you can track all of the data on a product from scanning its barcode with a handheld device. This also allows customers to know when their package is scheduled to arrive along with allowing the company to store the data for future analysis. An upgrade to this system is a Radio Frequency Identification System or RFID and has been adopted by some Amazon Warehouses and will also be how the Amazon Go stores track when a customer takes an item off the shelf. Some distributing companies require their suppliers to implement an RFID system to improve visibility and seamlessness between the companies. A good start to becoming knowledgable of RFID systems is with the book shown below. It describes the implementation process to anyone who needs it including small business owners, warehouse managers, and supply-chain managers... or simply to the person who wants to get a better understanding of how warehouses become more efficient!