A machine learning approach for predictive warehouse design

Abstract

Warehouse management systems (WMS) track warehousing and picking operations, generating a huge volumes of data quantified in millions to billions of records. Logistic operators incur significant costs to maintain these IT systems, without actively mining the collected data to monitor their business processes, smooth the warehousing flows, and support the strategic decisions. This study explores the impact of tracing data beyond the simple traceability purpose. We aim at supporting the strategic design of a warehousing system by training classifiers that can predict the storage technology (ST), the material handling system (MHS), the storage allocation strategy (SAS), and the picking policy (PP) of a storage system. We introduce the definition of a learning table, whose attributes are benchmarking metrics applicable to any storage system. Then, we investigate how the availability of data in the warehouse management system (i.e. varying the number of attributes of the learning table) affects the accuracy of the predictions. To validate the approach, we illustrate a generalisable case study which collects data from sixteen different real companies belonging to different industrial sectors (automotive, manufacturing, food and beverage, cosmetics and publishing) and different players (distribution centres and third-party logistic providers). The benchmarking metrics are applied and used to generate learning tables with varying number of attributes. A bunch of classifiers is used to identify the crucial input data attributes in the prediction of ST, MHS, SAS, and PP. The managerial relevance of the data-driven methodology for warehouse design is showcased for 3PL providers experiencing a fast rotation of the SKUs stored in their storage systems.