Development of an Industry 4.0-Based Analytical Method for the Value Stream Centered Optimization of Demand-Driven Warehousing Systems

Abstract

In real life situations, the material handling strategy of on-site storage systems is usually determined during the design of the storage system, which is no longer reviewed later. The strategy is typically determined by the person(s) designing the storage system, without the use of scientific methods, based on previous experience. Without a thorough periodic review of operational strategy, most companies’ warehousing systems have significant logistical losses (e.g., unnecessary material handling, waiting, operations), which also negatively affects the sustainability of the logistics operations. Therefore, eliminating these losses can increase both the competitiveness and the sustainability of companies. For this reason, the aim of this publication is to introduce a gap-filling test method that allows the selection of an optimal material handling strategy covering the total value stream in a demand-driven storage environment, using the opportunities offered by the Industry 4.0 concept, in particular in the field of big data analysis. This integrated approach has so far not emerged in the study of warehouse material handling strategies. Beyond the obvious economic benefits, the application of this method can clearly help companies to achieve a higher level of sustainability in their logistics operations, as it allows storage systems to operate more efficiently while minimizing material handling losses, ultimately resulting in a lesser demand for energy and raw materials. Moreover, this can also result in a reduction in the human and machine resources required to perform the tasks.