The goal of Ferrometal Oy, a company specializing in fasteners and small fittings, is rapid growth by 2020. The logistics department sprang straight to action by renewing all warehouse functions at a single stroke. Productivity improved significantly and the results keep getting better.
The need for renewing the warehouse grew from a purely strategic point of view. Logistics are an important competitive aspect for Ferrometal and a function that is highly critical for business. In order to reach the ambitious goals, the current manual warehouse functions needed to be renewed.
“The starting point was fairly typical. Items had fixed warehouse locations and client-specific pickers. The situation was challenging especially for new employees. Orders were usually picked one by one according to paper lists and one round spanned all three warehouses. Because there was no system to offer support, there was a lot of waste,” says Ferrometal’s Logistics Manager Timo Heiska.
In the solution suggestion presented by Leanware, picking methods were optimized in accordance with the order type to batch, kanban and automated picking.
Paper lists were changed for wireless terminal picking and the pallet warehouse began using dynamic warehousing. Additionally, all necessary integrations were implemented in the SAP system and vertical lift systems. The entire process is controlled by the LeanwareWMS solution.
“Before, we would spend time craning our necks along corridors trying to look for an empty space. In the new system, all items are logged directly into the system, after which it calculates and instructs where the item should go next. Paper picking list are also history,” Heiska says.
“We wanted to create method for all functions. When the system guides work and automation, everything goes to plan and a unified way of working forms naturally at the warehouse. This way staff can be flexibly changed between different operations and resources are easier to target correctly,” Leanware’s Business Unit Manager Anssi Tikka says.
“We were seeking a local, agile partner for the project and required solid experience with delivering systems and the practical knowledge of what actually takes place in the warehouse. While the competing suppliers asked us what we wanted, Leanware was asking direct questions about our operations and challenging our operational procedures. We felt right away that this is what we’ve been looking for in order for us to reach our goals,” Heiska says.
“We won’t blindly do something just because the customer demands it and is ready to pay for it. If it doesn’t make sense, you need to have the courage to say so out loud. It is our way of building trust and added value with the customer,” Tikka states.
Completing a development project is a team effort and requires, not only open-mindedness, but also negotiation skills and internal marketing. The project team was intentionally kept as compact as possible. On the other hand, when creating an overview of the current situation, all departments were involved, including purchasing and sales.
“The bigger the group is, the more difficult it is to keep the focus on the core matters. It is critical, how the skills of individual people can be utilized by the entire company and the working group. A project manager must be able to see the change from the viewpoint of every stakeholder and not only from the upper level,” Heiska emphasizes.
According to Heiska, Ferrometal was successful in the fact that the project had the strong support of the management right from the beginning.
“The shift from a manual warehouse to a dynamic one is big and sometimes resources were limited. Once the process changeover has been made, you cannot easily back out after a problem or two occur. In this case, the CEO is the project manager’s biggest support.”
In accordance with its strategy, Ferrometal is now realizing its vision. Productivity has increased significantly and the goods are on their way to the customer on the day the order was made. Continuous collection of data helps locate bottlenecks, so the results keep getting better over time.
“The greatest thing was to see how the same amount of people could accomplish so much more. The system enables a more independent way of working than before, which adds to the efficiency, variety and meaningfulness of work,” Heiska says.
Each of the 30,000 items had a fixed warehouse location and client-specific pickers. Orders were usually picked one by one according to paper lists and one round spanned all three warehouses. The situation was challenging especially for new employees and without system guidance, there was a lot of waste.
Pickable items were optimized in accordance with the order type to batch, kanban and automated picking. Paper lists were changed for wireless terminal picking and the pallet warehouse began using dynamic warehousing. Additionally, all necessary integrations were implemented in the SAP system and vertical lift systems. The entire process is controlled by the LeanwareWMS.
Ferrometal Oy is a wholesaler company specializing in fasteners and small fittings that was founded in 1976. There are about 30,000 active items and the outgoing volume is about 600,000 kg per month. The turnover of the company, which employs 105 people, is 27 MEUR and the delivery rate of the warehouse is 99%. Ferrometal is part of the international Würth group.