1.1 world class dc start up (mwdc)

36
Start Up of a World Class Distribution Center: Hershey’s MWDC  Kenneth D. Miesemer CPIM, CIRM Sr. Consultant, St. Onge Company Formerly Director, Distribution & International Logistics Hershey Foods Corporation

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Page 1: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 136

Start Up of aWorld Class Distribution Center

Hersheyrsquos MWDC

Kenneth D Miesemer CPIM CIRMSr Consultant St Onge Company

Formerly Director Distribution amp International Logistics

Hershey Foods Corporation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 236

1

Agenda

Why Change the US Network

Network Modelling

Throughput Volume amp Storage Capacity Analysis

Project Management - Steering Committee

Site Selection Facility Design

Material Handling Design

Operator Selection

Selecting amp Implementing the WMS

Labour Management System

Metrics

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 336

2

Who is The Hershey Company

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 436

3

Why Change the US Network

Key Objectives Consolidate Storage

ndash 22 Facilities in19981999

Increase Shipment

Capacity Improve Service

Improve Accuracy

Reduce Costs

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 5364

Network Modelling

Develop Baseline Network Model ldquoAs-Is Networkrdquo

ExistingDistribution

CentresFunctionsCapabilities

amp Cost

CustomerDemandProfile by

DistributionCentre Growth

SourcingLocations andCapabilities

InventoryBy LocationOptimization

Model

TransportationCost

InboundOutbound amp

Returns

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 6365

Network Modelling ndash Process Steps

Identify Logistics Modelling Scenarios

StoreReplenishmentCrossdocked

Crossdock Operations

30-50-70

Slow MoversConsolidated

In OneDistribution

Centre

DistributionCentre to Store

Cycle TimeIncluding

OrderPreparation

Vision Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 7366

Network Modelling ndash Process Steps

Model Scenarios and Evaluate

Identify Best Solution for Proposal

Detailed Cost by Scenario Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 8367

Global Company already operating in ChinaSupply Chain issues to be resolved

Transport costs high

Service inconsistent (lead time) Excessive number of distributors

Lack of distributor control

Extreme complexity

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 9368

Optimization Project Overview Plant analysis

Distributor analysis

DC location amp optimized sourcing

Network costs and service

Inventory Analysis

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 10369

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 113610

All plants deliver to all RDCrsquos Missing plant buffer and inability to properly replenish DCrsquoscreates product re-allocation between RDCrsquos

Beijing Plants

Chengdu DC

Beijing DC

Guangzhou DC

Suzhou DC

Tianmei Plants

Guantong Plants

Suzhou Plants

DSD and Direct Ship

bull Northbull WalMart

bull West

bull Southbull Tesco

bull Eastbull WalMartbull Huanlian

4 7

0 D i s t r i b u t or s

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 2: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 236

1

Agenda

Why Change the US Network

Network Modelling

Throughput Volume amp Storage Capacity Analysis

Project Management - Steering Committee

Site Selection Facility Design

Material Handling Design

Operator Selection

Selecting amp Implementing the WMS

Labour Management System

Metrics

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 336

2

Who is The Hershey Company

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 436

3

Why Change the US Network

Key Objectives Consolidate Storage

ndash 22 Facilities in19981999

Increase Shipment

Capacity Improve Service

Improve Accuracy

Reduce Costs

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 5364

Network Modelling

Develop Baseline Network Model ldquoAs-Is Networkrdquo

ExistingDistribution

CentresFunctionsCapabilities

amp Cost

CustomerDemandProfile by

DistributionCentre Growth

SourcingLocations andCapabilities

InventoryBy LocationOptimization

Model

TransportationCost

InboundOutbound amp

Returns

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 6365

Network Modelling ndash Process Steps

Identify Logistics Modelling Scenarios

StoreReplenishmentCrossdocked

Crossdock Operations

30-50-70

Slow MoversConsolidated

In OneDistribution

Centre

DistributionCentre to Store

Cycle TimeIncluding

OrderPreparation

Vision Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 7366

Network Modelling ndash Process Steps

Model Scenarios and Evaluate

Identify Best Solution for Proposal

Detailed Cost by Scenario Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 8367

Global Company already operating in ChinaSupply Chain issues to be resolved

Transport costs high

Service inconsistent (lead time) Excessive number of distributors

Lack of distributor control

Extreme complexity

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 9368

Optimization Project Overview Plant analysis

Distributor analysis

DC location amp optimized sourcing

Network costs and service

Inventory Analysis

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 10369

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 113610

All plants deliver to all RDCrsquos Missing plant buffer and inability to properly replenish DCrsquoscreates product re-allocation between RDCrsquos

Beijing Plants

Chengdu DC

Beijing DC

Guangzhou DC

Suzhou DC

Tianmei Plants

Guantong Plants

Suzhou Plants

DSD and Direct Ship

bull Northbull WalMart

bull West

bull Southbull Tesco

bull Eastbull WalMartbull Huanlian

4 7

0 D i s t r i b u t or s

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 3: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 336

2

Who is The Hershey Company

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 436

3

Why Change the US Network

Key Objectives Consolidate Storage

ndash 22 Facilities in19981999

Increase Shipment

Capacity Improve Service

Improve Accuracy

Reduce Costs

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 5364

Network Modelling

Develop Baseline Network Model ldquoAs-Is Networkrdquo

ExistingDistribution

CentresFunctionsCapabilities

amp Cost

CustomerDemandProfile by

DistributionCentre Growth

SourcingLocations andCapabilities

InventoryBy LocationOptimization

Model

TransportationCost

InboundOutbound amp

Returns

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 6365

Network Modelling ndash Process Steps

Identify Logistics Modelling Scenarios

StoreReplenishmentCrossdocked

Crossdock Operations

30-50-70

Slow MoversConsolidated

In OneDistribution

Centre

DistributionCentre to Store

Cycle TimeIncluding

OrderPreparation

Vision Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 7366

Network Modelling ndash Process Steps

Model Scenarios and Evaluate

Identify Best Solution for Proposal

Detailed Cost by Scenario Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 8367

Global Company already operating in ChinaSupply Chain issues to be resolved

Transport costs high

Service inconsistent (lead time) Excessive number of distributors

Lack of distributor control

Extreme complexity

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 9368

Optimization Project Overview Plant analysis

Distributor analysis

DC location amp optimized sourcing

Network costs and service

Inventory Analysis

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 10369

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 113610

All plants deliver to all RDCrsquos Missing plant buffer and inability to properly replenish DCrsquoscreates product re-allocation between RDCrsquos

Beijing Plants

Chengdu DC

Beijing DC

Guangzhou DC

Suzhou DC

Tianmei Plants

Guantong Plants

Suzhou Plants

DSD and Direct Ship

bull Northbull WalMart

bull West

bull Southbull Tesco

bull Eastbull WalMartbull Huanlian

4 7

0 D i s t r i b u t or s

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 4: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 436

3

Why Change the US Network

Key Objectives Consolidate Storage

ndash 22 Facilities in19981999

Increase Shipment

Capacity Improve Service

Improve Accuracy

Reduce Costs

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 5364

Network Modelling

Develop Baseline Network Model ldquoAs-Is Networkrdquo

ExistingDistribution

CentresFunctionsCapabilities

amp Cost

CustomerDemandProfile by

DistributionCentre Growth

SourcingLocations andCapabilities

InventoryBy LocationOptimization

Model

TransportationCost

InboundOutbound amp

Returns

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 6365

Network Modelling ndash Process Steps

Identify Logistics Modelling Scenarios

StoreReplenishmentCrossdocked

Crossdock Operations

30-50-70

Slow MoversConsolidated

In OneDistribution

Centre

DistributionCentre to Store

Cycle TimeIncluding

OrderPreparation

Vision Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 7366

Network Modelling ndash Process Steps

Model Scenarios and Evaluate

Identify Best Solution for Proposal

Detailed Cost by Scenario Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 8367

Global Company already operating in ChinaSupply Chain issues to be resolved

Transport costs high

Service inconsistent (lead time) Excessive number of distributors

Lack of distributor control

Extreme complexity

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 9368

Optimization Project Overview Plant analysis

Distributor analysis

DC location amp optimized sourcing

Network costs and service

Inventory Analysis

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 10369

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 113610

All plants deliver to all RDCrsquos Missing plant buffer and inability to properly replenish DCrsquoscreates product re-allocation between RDCrsquos

Beijing Plants

Chengdu DC

Beijing DC

Guangzhou DC

Suzhou DC

Tianmei Plants

Guantong Plants

Suzhou Plants

DSD and Direct Ship

bull Northbull WalMart

bull West

bull Southbull Tesco

bull Eastbull WalMartbull Huanlian

4 7

0 D i s t r i b u t or s

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 5: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 5364

Network Modelling

Develop Baseline Network Model ldquoAs-Is Networkrdquo

ExistingDistribution

CentresFunctionsCapabilities

amp Cost

CustomerDemandProfile by

DistributionCentre Growth

SourcingLocations andCapabilities

InventoryBy LocationOptimization

Model

TransportationCost

InboundOutbound amp

Returns

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 6365

Network Modelling ndash Process Steps

Identify Logistics Modelling Scenarios

StoreReplenishmentCrossdocked

Crossdock Operations

30-50-70

Slow MoversConsolidated

In OneDistribution

Centre

DistributionCentre to Store

Cycle TimeIncluding

OrderPreparation

Vision Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 7366

Network Modelling ndash Process Steps

Model Scenarios and Evaluate

Identify Best Solution for Proposal

Detailed Cost by Scenario Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 8367

Global Company already operating in ChinaSupply Chain issues to be resolved

Transport costs high

Service inconsistent (lead time) Excessive number of distributors

Lack of distributor control

Extreme complexity

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 9368

Optimization Project Overview Plant analysis

Distributor analysis

DC location amp optimized sourcing

Network costs and service

Inventory Analysis

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 10369

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 113610

All plants deliver to all RDCrsquos Missing plant buffer and inability to properly replenish DCrsquoscreates product re-allocation between RDCrsquos

Beijing Plants

Chengdu DC

Beijing DC

Guangzhou DC

Suzhou DC

Tianmei Plants

Guantong Plants

Suzhou Plants

DSD and Direct Ship

bull Northbull WalMart

bull West

bull Southbull Tesco

bull Eastbull WalMartbull Huanlian

4 7

0 D i s t r i b u t or s

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 6: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 6365

Network Modelling ndash Process Steps

Identify Logistics Modelling Scenarios

StoreReplenishmentCrossdocked

Crossdock Operations

30-50-70

Slow MoversConsolidated

In OneDistribution

Centre

DistributionCentre to Store

Cycle TimeIncluding

OrderPreparation

Vision Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 7366

Network Modelling ndash Process Steps

Model Scenarios and Evaluate

Identify Best Solution for Proposal

Detailed Cost by Scenario Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 8367

Global Company already operating in ChinaSupply Chain issues to be resolved

Transport costs high

Service inconsistent (lead time) Excessive number of distributors

Lack of distributor control

Extreme complexity

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 9368

Optimization Project Overview Plant analysis

Distributor analysis

DC location amp optimized sourcing

Network costs and service

Inventory Analysis

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 10369

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 113610

All plants deliver to all RDCrsquos Missing plant buffer and inability to properly replenish DCrsquoscreates product re-allocation between RDCrsquos

Beijing Plants

Chengdu DC

Beijing DC

Guangzhou DC

Suzhou DC

Tianmei Plants

Guantong Plants

Suzhou Plants

DSD and Direct Ship

bull Northbull WalMart

bull West

bull Southbull Tesco

bull Eastbull WalMartbull Huanlian

4 7

0 D i s t r i b u t or s

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 7: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 7366

Network Modelling ndash Process Steps

Model Scenarios and Evaluate

Identify Best Solution for Proposal

Detailed Cost by Scenario Workshop

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 8367

Global Company already operating in ChinaSupply Chain issues to be resolved

Transport costs high

Service inconsistent (lead time) Excessive number of distributors

Lack of distributor control

Extreme complexity

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 9368

Optimization Project Overview Plant analysis

Distributor analysis

DC location amp optimized sourcing

Network costs and service

Inventory Analysis

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 10369

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 113610

All plants deliver to all RDCrsquos Missing plant buffer and inability to properly replenish DCrsquoscreates product re-allocation between RDCrsquos

Beijing Plants

Chengdu DC

Beijing DC

Guangzhou DC

Suzhou DC

Tianmei Plants

Guantong Plants

Suzhou Plants

DSD and Direct Ship

bull Northbull WalMart

bull West

bull Southbull Tesco

bull Eastbull WalMartbull Huanlian

4 7

0 D i s t r i b u t or s

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 8: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 8367

Global Company already operating in ChinaSupply Chain issues to be resolved

Transport costs high

Service inconsistent (lead time) Excessive number of distributors

Lack of distributor control

Extreme complexity

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 9368

Optimization Project Overview Plant analysis

Distributor analysis

DC location amp optimized sourcing

Network costs and service

Inventory Analysis

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 10369

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 113610

All plants deliver to all RDCrsquos Missing plant buffer and inability to properly replenish DCrsquoscreates product re-allocation between RDCrsquos

Beijing Plants

Chengdu DC

Beijing DC

Guangzhou DC

Suzhou DC

Tianmei Plants

Guantong Plants

Suzhou Plants

DSD and Direct Ship

bull Northbull WalMart

bull West

bull Southbull Tesco

bull Eastbull WalMartbull Huanlian

4 7

0 D i s t r i b u t or s

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 9: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 9368

Optimization Project Overview Plant analysis

Distributor analysis

DC location amp optimized sourcing

Network costs and service

Inventory Analysis

China Network Optimization Case Study

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 10369

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 113610

All plants deliver to all RDCrsquos Missing plant buffer and inability to properly replenish DCrsquoscreates product re-allocation between RDCrsquos

Beijing Plants

Chengdu DC

Beijing DC

Guangzhou DC

Suzhou DC

Tianmei Plants

Guantong Plants

Suzhou Plants

DSD and Direct Ship

bull Northbull WalMart

bull West

bull Southbull Tesco

bull Eastbull WalMartbull Huanlian

4 7

0 D i s t r i b u t or s

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 10: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 10369

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 113610

All plants deliver to all RDCrsquos Missing plant buffer and inability to properly replenish DCrsquoscreates product re-allocation between RDCrsquos

Beijing Plants

Chengdu DC

Beijing DC

Guangzhou DC

Suzhou DC

Tianmei Plants

Guantong Plants

Suzhou Plants

DSD and Direct Ship

bull Northbull WalMart

bull West

bull Southbull Tesco

bull Eastbull WalMartbull Huanlian

4 7

0 D i s t r i b u t or s

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 11: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 113610

All plants deliver to all RDCrsquos Missing plant buffer and inability to properly replenish DCrsquoscreates product re-allocation between RDCrsquos

Beijing Plants

Chengdu DC

Beijing DC

Guangzhou DC

Suzhou DC

Tianmei Plants

Guantong Plants

Suzhou Plants

DSD and Direct Ship

bull Northbull WalMart

bull West

bull Southbull Tesco

bull Eastbull WalMartbull Huanlian

4 7

0 D i s t r i b u t or s

Plant and Distributor Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 12: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 123611

Network Costs amp Optimization

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 13: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1336

Optimized Solution4 DCrsquos in Mainland China

Plants Category Capacity (mt) Utilization (mt) MYU 06 Beijing Old A 12000 65 Suzhou B 49000 67 Tianjin C 42000 62 Guantong D 21000 55 Total 124000 75

Import 2006 (mt) Export 2006 (mt) Spare Capacity (mt)

161 18000 39000

RDCs Capacity (mt) Capacity (Pal) Utilization (Pal)

Beijing 12744 18000 58 Suzhou 14818 17250 78 Suzhou ndash B 2580 3000 79 Guangzhou 6013 7000 35 Chengdu 2835 3300 87 Total 39990 46550 86

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 14: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1436

13

Optimized Network Service Regions

Costs and service expectations for each proposed design

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 15: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1536

14

After the network has been defined it is necessary torevisit the inventory strategy and policy

optimize safety stock

optimize stock mix

cycle stockbuffer strategy

DPS opportunity

Inventory Analysis

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 16: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1636

15

Throughput Volume amp Storage Capacity Analysis

Plotted InventoryBalances - 36 Months

Growth Factors - SKUamp Sales

Production CapacityConstraints

Optimal ThroughputCapacity

-

100000

200000

300000

400000

500000

600000

1 1 2 0 0 5

1 1 5

2 0 0

5

1 2 9

2 0 0

5

2 1 2

2 0 0

5

2 2 6

2 0 0

5

3 1 2

2 0 0

5

3 2 6

2 0 0

5

4 9

2 0 0 5

4 2 3

2 0 0

5

5 7

2 0 0 5

5 2 1

2 0 0

5

6 4 2 0 0 5

6 1 8

2 0 0

5

7 2 2 0 0 5

7 1 6

2 0 0

5

7 3 0

2 0 0

5

8 1 3

2 0 0

5

8 2 7

2 0 0

5

9 1 0

2 0 0

5

9 2 4

2 0 0

5

1 0 8 2 0 0

5

1 0 2 2 2 0 0 5

1 1 5 2 0 0

5

1 1 1 9

2 0 0 5

1 2 3 2 0 0

5

1 2 1 7

2 0 0 5

Capacity

85 Oper

85Oper

90 O er

Key Issue Was Storage Constraint

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 17: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1736

16

2005 Steady State Network Map

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 18: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1836

17

Project Management

Critical to Success

Developed High-Level Plan

Assignment of Team

Leaders amp Members

Development of Teamrsquos

Detail Plans

1000 + Task Master Plan

Steering Committee

ndash Program Manager

PMO Supervisor

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 19: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 1936

18

MWDCProject Management Team

MWDC

Steering Committee

MWDCProgram Manager

Project ManagementSupervisor

Business Assignments

Team

DC Operations Ramp Up amp Integration

MWDC Construction

MWDC Distribution Operations

Plant Changes To Support

New Network

Real Estate

Incentives

HersheyInternal Audit

WMS System Integration amp

Implementation

On-SiteContacts

CustomerDirect

Contact

Plant

Construction

Coordinator

Production Planning amp

DeploymentDirect

Ship Contact

WMS Configuration amp

IT Infrastructure

Systemamp Testing Resources

Day in the Life

Testing

Infrastructure amp

Disaster Recovery Testing

Integration

Testing

System Testing

Cost Plus amp Budget

Development

MHE

SAP Systems

Training

Transportation

Capacity Planning

WMS System

User amp Training

3PLAdmin

Office

Distribution Ops

Process amp BDPs

QARequirements

SOPs amp System

Processes

Customer

Service

Demand

Planning

Distribution

Ops

Information

Services

Production

Planning amp Deployment

Transportation

Ops

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 20: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2036

19

Project Governance

Team Leaders Weekly Meetings ndash Monitor Tasks

ndash Resolve Issues or Raise to Project Management Office

Program Manager Weekly One on Ones

ndash With PMO Supervisor amp Project Leads

ndash Review Task Plans

ndash Discuss Unresolved Issues

Team Leaders Weekly Meetings

ndash Discuss Unresolved Issues With Project Impact

ndash Go No-Go Decisions Steering Committee

ndash Milestone Review Issues

ndash WMS Project

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 21: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2136

20

MWDC Major Projects

Facility Related Projects ndash Site SelectionIncentives

ndash Approvals amp Permits

ndash Building Design

ndash Construction

ndash Material Handling Systems

WMS Selection amp Implementation ndash WMS configuration

ndash Infrastructure amp EDI

ndash Integration testing

ndash Day in the Life

Operator Selection

Transportation Operations

Business Assignment Ramp-Up

Process Design Documentation

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 22: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2236

21

MWDC Site Selection

Criteria ndash Fast Track Permitting

ndash 90 Acres

11 Million Square FeetPlus Expansion

ndash TransportationInfrastructure amp Costs

ndash Labour

ndash Utilities

ndash Taxes Incentives

ndash Total Cost Not Just Land ndash Edwardsville IL Selected amp

Approved May 22 2003

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 23: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2336

22

Facility Design

Engineering Study Initiated

EDC III became the model

Key Deliverables

Facility Recommendations (Size Shape)

Capital Requirements

Operating Cost Estimates

Material Handling Systems

3PL Operator Input ndash use your

operations team

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 24: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2436

23

MWDC Facility Design

A B C

CustomizationArea

Product RecoveryArea

Pick Tunnels

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 25: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2536

24

Facility Spec Sheet

1080166 Square Feet

ndash 120000 sq meter

165000 Pallet Positions

7 High Double Deep Rack 6 Pick Tunnel Lanes

163 Dock Doors

80rsquo Staging Lanes (26 meter)

650 Static Case Pick Locations

600 Drop Trailer Spots

4 Automatic Stretch Wrappers

Training Meeting Room ndash 200 person

Capacity

1000 Square Meter Maintenance Shop

1550 Square Meter Recoup Space

Customization Centre

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 26: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2636

25

Material Handling Design Study

Detailed Racking Design

Automatic amp Semi-Automatic Wrappers

Pallet Inverters

Mobile Lifts

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 27: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2736

26

Material Handling - Equipment

Recommendations - Operator Involvement Matrix

ndash Features vs Requirements

ndash Vendor Reputation

ndash Local Maintenance

ndash Warranty

ndash Price

ndash Phased Delivery

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 28: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2836

27

Operator Selection

Operator Selection Team

ndash Distribution

ndash Transportation

ndash Engineering

ndash Customer Service

ndash Finance

ndash Information Systems

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 29: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 2936

28

WMS Selection

WMS Selection Team ndash Project Manager ndash Process Manager ndash EDI Specialist ndash Consultant ndash Client Departments

Complete System Requirement ndash Identify Functionality

ndash Created Grading Spreadsheet Used WMS Consultants

ndash Selection ndash Configuration ndash Implementation

Other Evaluations ndash Site Visits ndash User Group Conferences ndash Mini-Conference Room Pilot

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 30: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3036

29

WMS Selection

WMS Selected

ndash Network Strategy

Hershey (EDC III SoCal MWDChellip )

Enabler for Productivity ndash Interleaving ndash Work Manager

ndash Large Building Support

ndash Best Door and Cross Dock Receipts

ndash Labour Management amp Engineered Standards

ndash Yard Management

MWDC I l t ti amp R U

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 31: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3136

30

MWDC Implementation amp Ramp Up

MWDC Ramp Up Team ndash Cross Functional Representation

Production Planning amp Deployment

Demand Planning

Distribution

Transportation Customer Service

Information Services

ndash Entire US sourcing Project

5 year Planning Horizon

Forecast Realignment Strategies

Contingency Planning for Building Closures

Customer Communication

Integrated With Overall Project Plan

Direct Plant Shipping Initiative

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 32: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3236

31

MWDC Implementation amp Ramp Up

Training amp Development ndash Hershey College

ndash Supervisor ImmersionTraining

ndash End User Training ndash Training Animations

C amp

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 33: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3336

32

MWDC Implementation amp Ramp Up

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 34: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3436

33

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 35: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3536

34

Australia Case Study

Kinchrome case study parallels Hershey ndash Strategic location - Melbourne

ndash Warehouse design for world class operations

ndash Goals improve accuracy throughput productivity reducecosts consolidate inventory

Kincrome Case Study

Q ti

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions

Page 36: 1.1 World Class DC Start Up (MWDC)

842019 11 World Class DC Start Up (MWDC)

httpslidepdfcomreaderfull11-world-class-dc-start-up-mwdc 3636

35

Questions