Analyzing of warehouse management at avery dennison company (warehouse 4)

MINISTRY OF EDUCATION AND TRAINING HO CHI MINH CITY UNIVERSITY OF TECHNOLOGY AND EDUCATION CAPSTONE PROJECT INDUSTRIAL MANAGEMENT ANALYZING OF WAREHOUSE MANAGEMENT AT AVERY DENNISON COMPANY (WAREHOUSE 4) LECTURER: Ms HỒ THỊ HỒNG XUYÊN STUDENT: TRẦN ĐÌNH DUY SKL 0 Ho Chi Minh City, December, 2021 Luan van MINISTRY OF EDUCATION AND TRAINING HO CHI MINH CITY UNIVERSITY OF EDUCATION AND TECHNOLOGY FACULTY OF ECONOMICS GRADUATION THESIS TOPIC: ANALYZING OF WAREHOUSE MANAGEMENT AT AVERY DENNISON COMPANY (WAREHOUSE 4) Student : Trần Đình Duy ID Number : 18124156 Course : 2018 Major : Industry Management Instructor : Ms Hồ Thị Hồng Xuyên Ho Chi Minh City, December 2021 Luan van THANK YOU The Avery Dennison Company internship experience was a great opportunity to learn and develop my profession I consider myself also very grateful that I have been given the chance to be a part of it I am so lucky to meet so many great people and experts who have taken me through this point I would like to thank Mr Van Nguyen, Warehouse Manager, for his excellent work, he took the time to hear me and to direct me on the correct course, and encouraged me to carry on our project at their highly respected organization I am so thankful to you for the work you have done during the training I appreciate Mr Don Ho for his valuable decision and advice and encouragement He was my Team Leader at the time He helped me push up my strong suit to the next level I am thankful to remember his contribution at this moment I would also like to thank the Faculty of Economics, University of Technology and Education for developing such an incredibly useful course, so we can learn theoretically as well as in practice In pleasure, I really appreciate all the wonderful things Ms Ho Thi Hong Xuyen, my mentor, my teacher, has done for me during this time I actually couldn’t write this thesis well without her assistance This chance I consider as a huge achievement in my car I should aspire to the best use of learned skills, expertise and seek to develop them in order to achieve desired career goals I hope that in the future we will continue to work together Ho Chi Minh City, December 2021 Author’s Sign Page i Luan van LIST OF ACRONYMS ACRONYMS FULL MEANING AD Avery Dennison Co Ltd Company Limited DA Data Analyst DOS Days Of Supply EHS Environment, Health and Safety FIFO First In – First Out GPD Global Project Development GRC Gate Realistic Confirm IHM Industrial and Healthcare Materials Im - Ex Import - Export INV Inventory KPIs Quick Response LGM Data Analyst MSEA Micro & Small Enterprises Authority MT Meter NYSE New York Stock Exchange PO Purchase Order Pur Purchasing QR Quick Response RBIS Retail Branding and Information Solutions RFID Radio-Frequency Identification Page ii Luan van RM Raw Materials SHT Sheet TQ Total Quality VMI Vendor Management Inventory VSIP Viet Nam – Singapore Industrial Park WH Warehouse WIFI Wireless Fidelity WMS Warehouse Management System Page iii Luan van LIST OF TABLE Table 3.1: Input – Work instruction at Warehouse 24 Table 3.2: Output – Work instruction at Warehouse 28 Table 3.3: Data record comparison 33 Page iv Luan van LIST OF FIGURE Figure 1.1: Avery Dennison Logo Figure 1.2: Label and Packaging Materials products Figure 1.3: Graphics products Figure 1.4: Reflective products Figure 1.5: Retail Branding and Information products Figure 1.6: RFID products Figure 1.7: Printer products Figure 1.8: Performance Tapes products Figure 1.9: Fastener products Figure 1.10: Medical products Figure 1.11: Avery Dennison RBIS chart operation Figure 1.12: Avery Dennison Annual Financial Report 2016 - 2020 10 Figure 1.13: Avery Dennison Year Stock Chart 10 Figure 1.14: Supply Chain Department and Warehouse work chart 12 Figure 1.15: Map in Warehouse 13 Figure 2.1: Structure of a supply chain 15 Figure 2.2: Example of a Double ABC Analysis 18 Figure 2.3: ABC Analysis: product value and frequency of sales 19 Figure 2.4: VMI chart work 20 Figure 2.5: Bullwhip effect illustrated 21 Figure 3.1: General link operation process 22 Figure 3.2: Import process chart 23 Figure 3.3: Goods Received Note 24 Figure 3.4: Raw materials arrive at Warehouse 24 Figure 3.5: TQ team are checking new RM 25 Figure 3.6: The temporary location 25 Figure 3.7: Stock cards 25 Figure 3.8: RM Tracking computer 26 Figure 3.9: Export process chart 27 Figure 3.10: RM Request form 28 Figure 3.11: Clerk team are checking on computer 28 Figure 3.12: The vacant location at Warehouse 29 Page v Luan van Figure 3.13: The Operator takes the goods 29 Figure 3.14: Storage documents 30 Figure 3.15: Air conditioner at Warehouse 31 Figure 3.16: Safe working loads instruction 31 Figure 3.17: The racks of Warehouse 32 Figure 3.18: The month label of Warehouse 33 Figure 3.19: Counterbalance forklift 35 Figure 3.20: Pallet Jack 36 Figure 3.21: Walkie Stacker 36 Figure 3.22: The reach fork truck 37 Figure 3.23: Plastic Pallet 37 Figure 3.24: Wood Pallet 37 Figure 3.25: Fire prevention tools 38 Figure 3.26: Chemical Indentification Tag 39 Figure 3.27: The volume data comparison 2021 – item 10H000141 43 Figure 4.1: VMI category using space inventory 46 Figure 4.2: VMI total inventory and max stock 46 Figure 4.3: VMI inventory situation 47 Figure 4.4: The old data information flow 49 Figure 4.5: The new data information flow 50 Figure 4.6: QR Barcode current and early project step 51 Figure 4.7: Working desk of Shipping mark team 52 Figure 4.8: Shipping mark label 53 Figure 4.9: Locator label 53 Figure 4.10: Shipping mark workflow chart 54 Figure 4.11: The new combine stamp (the new shipping mark) 57 Page vi Luan van LIST OF CONTENT THANK YOU i LIST OF TABLE iv LIST OF FIGURE v LIST OF CONTENT vii INTRODUCTION 1 Background of the thesis Purpose of the thesis Scope and Object of the thesis Research method Paragraphs CHAPTER 1: OVERVIEW ABOUT AVERY DENNISON AND WAREHOUSE 1.1 Introduction to Avery Dennison 1.1.1 Origin and Development 1.1.2 Field and Products 1.1.3 Business strategy (RBIS) 1.1.4 Organizational structure (RBIS) 1.1.5 Business report 1.2 Supply Chain department 11 1.2.1 Introduction to Supply Chain department 11 1.2.2 Supply Chain work chart 12 1.3 Warehouse 12 1.3.1 Introduction to warehouse 12 1.3.2 Warehouse map 13 1.3.3 Warehouse team 13 CHAPTER 2: LITERATURE REVIEW 15 2.1 Definition of supply chain 15 2.2 Warehouse in Supply Chain 16 2.2.1 What is Warehouse 16 2.2.2 The role of the warehouse 16 2.2.3 The function of the warehouse 16 2.3 Warehouse management 17 Page vii Luan van 2.4 ABC Classify 17 2.4.1 ABC Method 17 2.4.2 Double ABC Method 18 2.4.3 ABC Analysis 19 2.5 Vendor Management Inventory (VMI) 19 2.6 Bullwhip phenomenon 21 CHAPTER 3: THE REALITY OF WAREHOUSE 4’S WORKING PERFORMANCE 22 3.1 General link operation process 22 3.2 Specific business process in Warehouse 23 3.2.1 Import process 23 3.2.2 Export process 27 2.2.2 Inventory activities 30 3.3 Reality of warehouse management 33 3.3.1 Inventory status 33 3.3.2 Employee status 34 3.3.3 Warehouse layout status 35 3.3.4 Inventory forklift and pallets 35 3.3.5 Safety Status 38 3.3.6 Data information framework flow 39 3.4 Evaluation of the management of raw materials at Warehouse 39 3.4.1 Advantages 39 3.4.2 Disadvantages 41 CHAPTER 4: SOLUTION FOR A BETTER WAREHOUSE MANAGEMENT 44 4.1 Urgency and purpose 44 4.1.1 Urgency 44 4.1.2 Purpose and limitation 44 4.2 Solution for warehouse management 44 4.3 Shipping Mark Advanced Solution (QR Barcode) 50 4.3.1 Introduction 50 4.3.2 Current and Early Project Step 51 4.3.3 Project Description 52 4.3.4 Evaluation and solutions for QR Barcode project 54 Page viii Luan van The project goes for the goals: ● Unify the database throughout the products based on system and reality ● Close information and products linkage between warehouse and manufacture ● Visualize & standardize the physical information display ● Systematically tracking real-time transactions, reduce manual workload and human mistakes With these benefits: ● Pick goods purposefully following FIFO, decrease out-of-date material ● Minimize manual record and eliminate error typing (Stock cards) ● Close the gap between physical count and system count 4.3.2 Current and Early Project Step Figure 4.6: QR Barcode current and early project step (Source: Internal Company) Currently, the project is still being implemented and is in the “Applying & Testing Automation Barcode project” Step by step is a kind of many activities The whole Page 51 Luan van process step is applied to Zone D And then will apply to other zones of the whole Warehouse 4.3.3 Project Description A simple way to explain this project is to replace inventory management with stock cards with a management approach with shipping marks Shipping mark label will be affixed to each box of materials upon arrival Different materials will have different QR codes Retailed materials will be affixed with special labels, called core labels The outer label will be the parent label and the core label will be the child label Accompanying the QR codes are readers to identify the data for the Operator Features of shipping mark: ▪ Help the Operators identify materials and item codes ▪ Import and export material data for the working process ▪ Responsible for the stock card and the monthly card (Turn into 1) ▪ Declare the relevant information Explain the information outside and inside In order for the shipping mark work to go as planned, Warehouse must add another team That is the Shipping mark team, they will be the person to direct the current and future tasks of the team The role of the Shipping mark team: The mission of the shipping mark team has not been clearly formed Currently, the team is created to create the labels They will then label the materials under control They are also pasting the labels of the locators Working tools: Computer and Printer Figure 4.7: Working desk of Shipping mark team Page 52 Luan van (Source: Author composed) The shipping mark shows the basic information of the material and its QR code The QR code of the core inside the material bin will link to the QR code outside These QR codes are run by algorithmic software and no two codes are exactly alike Figure 4.8: Shipping mark label (Source: Author composed) Figure 4.9: Locator label (Source: Author composed) Adding a team to Warehouse changes the workflow And the steps in that process will be summarized as follows: Page 53 Luan van Figure 4.10: Shipping mark workflow chart (Source: Internal Company) The steps to build a shipping mark workflow are also a description of the future shipping mark's working steps Each step will be a stage in the working process Inventory after entering the gate will be fully stamped by the shipping team and then the steps to enter the warehouse as usual Then if there is a move of the material, t must scan and move that material After that, the material is exported from the warehouse, then scanned out and presented to the gate and shipped 4.3.4 Evaluation and solutions for QR Barcode project The QR Barcode project is a plan to improve the management efficiency of the warehouse The operation and implementation of the project will be the foundation for future work efficiency During the implementation of the project, we have discovered different strengths and limitations It is very important to overcome difficulties and shortcomings Advantages of the project: ● Pick goods purposefully following FIFO, decrease out-of-date material ● Minimize manual record and eliminate error typing (Stock cards removed) ● Close the gap between physical count and system count, the efficiency of cycle count Page 54 Luan van ● The Operators work faster and improve the performance of other teams Disadvantages/issues of the project: ● The old teams not yet understand the new process that is about to change This major change will cause employees to re-learn from the beginning ● The locator labels are so vulnerable It was not a long lifespan ● The WIFI system does not meet The Reader's network access needs Sometimes, the information may be lost during connection failure ● There are still errors in information while scanning So the data on the system will also be wrong 4.3.5 The solution for the project Change the overall process of both warehouse and employee training Must build the integration of the new team into the general process of Warehouse This combination will help the teams work together more smoothly and effectively It could be a training session and training on new ways of working at the warehouse Need to rebuild warehouse process and team tasks Teams will embrace change and new ways of working Especially, the Operator team needs to be thoroughly trained on the steps to coordinate with the shipping mark They need to be trained on how to use the reader and manipulate QR barcodes etc It is necessary to build a professional leader to manage the work of this team The management of staff who manage KPIs and labels will be more effective if a good leader is selected The leader will provide more in-depth training for the shipping mark team to improve the group's activities Using label holder Make sure the team locator is solid and in place This makes searching and scanning the code unobstructed We need to use the label holder for the labels at the locator It will be difficult when the labels at that location cannot be used It can slow down the workflow of many other activities In addition, data may also be lost Using a label holder would be a safety measure to avoid such things Our locator labels will be better preserved and avoid physical impact or loss Page 55 Luan van Set up a stable WIFI network Add more WIFI hotspots at the warehouse Ensure that the reader will not lose network connection during work The WIFI waves must be stable and have a strong signal that can help to enter data into the system faster We have to install more WIFI transmitters for the warehouses and it has a good signal These transmitters must have the same signal name So that the scanners not lose connection while operating Build a Cycle Count team The tally will be somewhat different when we apply the shipping mark to all items in stock We can use scanner phones to check the quantity at any rack But that information also comes from the Operators We need to build a team whose main task is to count the actual number against the number on the system The information that this group brings will be extremely reliable when all they is count manually and count with a scanner phone Their findings will reveal where errors come from and who is responsible The small risk classification can reduce the cost of warehouse risks a lot In addition, the raw materials in the warehouse are extremely valuable and highly secure, so theft management is also very important 4.3.6 The novelty of the solution The above are the contributions to develop the project more optimally and effectively when applied that the author mentioned To have more unique novelty, the author would like to suggest to improve the shipping mark, attach more chemical labels to it This will save time and effort for the stamping team And the time of warehousing is also shortened Instead of having to paste both shipping marks and chemical labels, we only need to stick one combined stamp and it is easier for the work behind Below is an illustration for the new combined stamp Page 56 Luan van Figure 4.11: The new combine stamp (the new shipping mark) Source: Author composed Page 57 Luan van CONCLUSION After the internship period, I have learned about the process, professional operations, and management of Warehouse I have noticed that the Warehouse management is fantastic, but it needs more improvement for higher-level development The issue of this study is extremely significant and relevant because cost reduction and efficiency are the key goals of Avery Dennison company in general (Warehouse in particular) in order to boost their productivity and worldwide position The reality of Warehouse management and the working process at this raw material warehouse, along with the advantages and disadvantages in inventory management at this warehouse, have been specifically mentioned in this study Besides, the author has given solutions to manage inventory more efficiently and with less effort In fact, these solutions have been applied in practice and brought expected results When analyzing this warehouse, we find that the application of these solutions is appropriate and highly practical In addition, the author has put a real project that the company is doing at Warehouse This project will be a big change in a positive direction But in the process of working, I also discovered the issues and proposed ways to fix them to make the project progress better and achieve goals In the future, I hope these contributions will be applied by Avery Dennison to Warehouse and strongly develop its practical performance to other Avery Denison RBIS companies Managers can achieve satisfaction in this warehouse management shortly Page 58 Luan van REFERENCES [1] Kate Vitasek (2010) Supply Chain Visions 2010: The Importance of Supply Chain Management in Planning and Designing for Successful Freight Systems Michigan: University of Tennessee Publishing [2] Van den Berg, J P (2012) Highly competitive warehouse management Buren: Management Outlook Publishing [3] Michael ten Hompel, Thorsten Schmidt (2007) Warehouse management: Automation and Oranisation of Warehouse and Order Picking Systems New York: Springer Science + Business Media Publishing [4] Abby Jenkins (2020) Inventory Management vs Warehouse Management: What’s the Difference? From: “https://www.netsuite.com/portal/resource/articles/inventorymanagement/inventory -management-warehouse-management.shtml” [5] Luenendonk (2016) Warehouse Optimization ABC Analysis Steps, pp.28-32 from: “https://www.theseus.fi/bitstream/handle/10024/129596/Bentz_Kyle.pdf?sequence =1&isAllowed=y” [6] Frandsen, V (2014) ABC Analysis: Why only % of your products matters ABC Softwork Blog From: “https://blog.abcsoftwork.com/2014/08/abcanalysis-why-only-8-of-your-productsmatters/” [7] Gwynne Richards (2011).Warehouse management: A complete guide to improving efficiency and minimizing costs in the modern warehouse London: Kogan Page Limited Publishing [8] Wassim Sasso (2020) Vendor-Managed Inventory: Building the Modern Supply Chain from: “https://www.czarnikow.com/blog/vendor-managed-inventory-building-themodern-supply-chain” [9] Lee, H.L., Padmanabhan, P and Whang, S (1997a) Information distortion in a supply chain: the Bullwhip Effect, Management Science, Vol 43, pp 543-558 Page 59 Luan van [10] Avery Dennison Public Website, from: “https://www.averydennison.com/en/home” [11] Oracle Corporation Website “Oracle Warehouse Management Cloud: Welcome to the New Fulfillment Economy”, from: “https://www.oracle.com/scm/logistics/warehouse-management/” Page 60 Luan van APPANDIES Figure: VMI Inventory report (July 2021) Page 61 Luan van Figure: Avery Dennison internship confirm Page 62 Luan van BIÊN BẢN CHẤM KHÓA LUẬN TỐT NGHIỆP DÀNH CHO GVHD Tiêu chí đánh giá Nội dung Trích dẫn tài liệu tham khảo Yếu Trung Bình Khá Giỏi 0-3.0 3.1-4.0 4.1-5.0 5.1-6.0 Nội dung chương khơng có liên kết Những vấn đề cần nghiên cứu, mục tiêu nghiên cứu, nội dung không phù hợp với tên đề tài Các phân tích cịn lan man, chưa chi tiết Tất phân tích nhận định khơng có sở Nhiều ý phân tích thiếu mạch lạc, mâu thuẫn 0-0.4 Có tài liệu tham khảo Khơng có trích dẫn lý thuyết (khái niệm) nêu đề tài Có nhiều bảng biểu chưa đặt tên, đánh số ghi nguồn Nội dung chương thiếu liên kết Những vấn đề cần nghiên cứu, mục tiêu nghiên cứu, nội dung chưa phù hợp hồn tồn vào tên đề tài Các phân tích cịn lan man, chưa chi tiết Có nhiều phân tích nhận định khơng có sở Nội dung chương có liên kết Những vấn đề cần nghiên cứu, mục tiêu nghiên cứu, nội dung phù hợp với tên đề tài, phân tích sơ sài, chưa chi tiết, chưa tập trung giải toàn vấn đề nghiên cứu Một số phân tích, nhận định thiếu sở Nội dung chương có liên kết Những vấn đề cần nghiên cứu, mục tiêu nghiên cứu, nội dung phù hợp với tên đề tài Phân tích chi tiết, tập trung giải vấn đề nghiên cứu Các phân tích nhận định có sở 0.5-0.6 Tài liệu tham khảo khơng phong phú Khơng có trích dẫn lý thuyết (khái niệm) nêu đề tài Có nhiều bảng biểu chưa đặt tên, đánh số ghi nguồn 0.7-0.8 Tài liệu tham khảo phong phú Có số lý thuyết (khái niệm) chưa trích dẫn Có số bảng biểu chưa đặt tên, đánh số ghi nguồn đầy đủ 0.9-1.0 Tài liệu tham khảo phong phú Có trích dẫn đầy đủ lý thuyết (khái niệm) nêu đề tài Các bảng biểu đặt tên, đánh số đầy đủ, ghi nguồn đầy đủ (trừ bảng biểu tác giả tự phân tích, tính tốn) Luan van Điểm Câu văn từ ngữ 0-0.9 Triển khai ý thiếu rõ ràng, mâu thuẫn lộn xộn Rất nhiều lỗi sử dụng từ ngữ (chưa phù hợp với hoàn cảnh) Câu văn thiếu mạch lạc, nhiều lỗi tả 0-0.4 Rất liên lạc với GV để duyệt 1.0-1.3 Triển khai ý thiếu rõ ràng lộn xộn Nhiều lỗi sử dụng từ ngữ (chưa phù hợp với hoàn cảnh) Câu văn thiếu mạch lạc, nhiều lỗi tả 1.4-1.7 Triển khai ý thiếu rõ ràng Có số lỗi sử dụng từ ngữ (chưa phù hợp với hồn cảnh) Câu văn thiếu mạch lạc, có số lỗi tả 1.8-2.0 Triển khai ý rõ ràng, liền mạch Sử dụng từ ngữ phù hợp với hồn cảnh Câu văn mạch lạc, khơng có lỗi tả 0.5-0.6 0.7-0.8 0.9-1.0 Thỉnh thoản liên Thường xuyên liên Rất thường xuyên Thái độ lạc với GV để duyệt lạc với GV để duyệt liên lạc với GV để duyệt bài Điểm thưởng dành cho sinh viên viết báo cáo tiếng Anh dao động từ 0,1-1,0 điểm Tổng điểm: Kết luận:  Cho SV bảo vệ trước hội đồng  Không cho SV bảo vệ trước hội đồng Ngày ….tháng… năm …… Giảng viên chấm KLTN Luan van S K L 0 Luan van