Impact of strategic In-Plant Material Handling on Manufacturing Efficiency

Manufacturing involves a lot of material storage and its movement within the facility, right from the receipt of the material till its consumption. Business strategies and associated processes will drive the activities of these material i.e., storage, movement, and consumption.  Few are stored in warehouse for later use, and few are moved directly to the shopfloor area for production line consumption. Manufacturers adopt both Push and Pull strategies for consumption of the materials.

Effective availability, visibility and material movement activities will have a major impact on the manufacturing efficiency and productivity.

Significance of Material Storage, Picking & Consumption:

Manufacturing involves Storage, picking and movement of both raw materials and finished products. Based on the manufacturing scale and size of the facility these can be handled separately or combined within a given sub inventory storage areas.  Also, this separation may be based on the Machining and Assembly activities.  Generally, material stored in different locators withing a given storage area, based on the size of the material.  During material picking, locator specification becomes mandatory and if there is any difference in locator indication, then the user will not see the right availability of the material.

Hence it is very important on the business strategy of classifying the storage areas along with the locators within these locations. Picking becomes a critical task of the manufacturing logistics which plays a major role in the productivity, hence there should be effective strategies and good software system in place to take care of these activities that supports the manufacturing.

Below are few important elements of effective material storage, picking and consumption strategies.

  • Capacity and consumption driven storage
  • Rules based Organized picking.
  • Authorization enabled process in critical tasks.
  • Proper use of Barcodes for storage locations, packages and picking reports
  • Use of RF devices for dynamic transaction entry and real time visibility
  • Use of Pull strategies, reducing transactional overheads
  • Validation controls in place for under/over consumption of material, against the specific BOM.
  • Visual indicators on critical activities/flows.
  • Production Order based material picking and consumption.

Significance of Software Systems in Manufacturing Plant Material Handling:

Manufacturers face many challenges with the availability of the material at the right time to the right production line, irrespective of their good practices and processes.  This is majorly because of the poor warehouse management system and processes, which plays a critical role in Manufacturing Logistics.  A good warehouse management software system helps the business in effective management of all the tasks associated with the material controls, right from the receipt from the supplier till its consumption into a final product.

Critical elements of manufacturing logistics:

  • Traceability: The level of the traceability of materials and granularity of location information have a major impact on the manufacturing process
  • Real time visibility:  Dynamic and real time visibility of the stock and controlled ways of consumption and material movements make the process effective and shortens the process lead time.
  • Replenishment Strategy:  When and how to replenish the stock is another important element of the lean manufacturing process.  Right quantity at the right time along with auto-replenishment of the material is always an important aspect of the manufacturing process.
  • Planned & Calculated Safety stock: Its always preferred to have planned and calculated safety stock based on the consumption and potential demand and not just by a standard/fix quantity always across the items.
  • Tools & Equipment:  Use of proper tools and equipment in warehouse operations will majorly reduce the process leads time and enriches the manufacturing logistics activities.
  • ERP/WMS Software:  It is most important to have a right Software solution configured and available in place, catering all the business processes execution guidance requirements along with the reporting tools.  And also, the Software System should be able to tailored as per the organization requirements.


The real time information on the inventory levels along with strategic material handling i.e., like accurate ways of movement & tracking of these inventories, supply to the shopfloor production line at the right time at right operation, effective tools and software systems in managing the material allocation & movement activities will have a major impact on the manufacturing cycle.  Hence this plays a major role for any organization in the manufacturing facility and the effective ways of managing this, will definitely improves the efficiency and boosts the manufacturing productivity.

Author Details

Asif Basha Syed

Asif has 17+ years of experience in Oracle Practice with multiple end-to-end implementation, upgrade and support engagements across the Globe, besides 2 years of industry experience in Manufacturing domain. He is an Oracle Certified Specialist (EBS & Cloud) and has led solution design of several complex Oracle ERP implementations and designed multiple complex solutions spanning SCM/Manufacturing/Planning tracks.

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