As our economy advances out of recession, there are some things that will never be as they were. Material handling managers, for example, are not just responsible for material handling any more, but for many aspects of logistics—including transportation and distribution. Their facilities have multiple personalities as well. I encountered examples of both these phenomena at one site recently when I talked to Brent Beabout. He does material handling engineering and distribution center design for Office Depot, but his official title explains what I'm talking about: he's vice president of global network strategy and transportation.
His latest project for Office Depot required all of his logistics skills. It's a new fulfillment center in Newville, PA, that will service the chain's North American Retail stores as well as its Business Solutions Division customers. This combination facility represents the largest greenfield implementation of Kiva's “mobile fulfillment system,” comprised of inventory pods that are picked up and moved by a fleet of mobile robotic drive units. This “pod” system of storing and moving pallets, cases, and orders throughout a facility is another example of the kind of flexibility required of both material handling professionals and their tools.
This 600,000 square-foot operation will serve as a hub for Office Depot's Northeast U.S. region, supporting Office Depot's business to business customers as well as more than 100 store locations in the region. The Newville warehouse also houses a regional print facility. Beabout says this new combination approach will allow Office Depot to support its growing business, optimize total supply chain expenses and use inventory more efficiently.
The facility represents the integration of three (and soon four) other Office Depot distribution centers. And, as with any new concept, there's a learning curve associated with it. The operation houses 250 brand new employees and a new management staff that's not used to operating completely automated facilities. Most of them come from batch environments. This new environment will teach them the ins and outs of continuous flow—in other words, material handling logistics.
This isn't just a title, but a way of business life that eliminates waste and applies just the right resources to whatever the demand signal is at any one time. It requires someone with a holistic end-to-end view of their supply chain, all the way to the end customer. Beabout believes this requirement will draw talent from other disciplines to the new world of material handling logistics.
“They'll come from IT, data analytics, finance, the physical sciences,” he told me, “because there's a lot of low hanging fruit in this field. There's a lot of money in supply chain, especially in inventory in the retail business. A few percentage point gains in efficiency go right to the bottom line. That's why a lot of CFOs are now becoming very interested in the supply chain, where before they couldn't even spell it.”
Talent goes where the money goes. And because manufacturing isn't what it used to be in the U.S., the supply chain is becoming the new differentiator among companies—just as the multi-talented Brent Beabout is making a difference for Office Depot.