Using storage systems to increase productivity

Key concepts Storage systems are a simple and relatively inexpensive way to improve efficiency and the bottom line.

By Dan Lynn and Greg Benton, Stanley Storage Systems, Stanley Mechanics Tools Div., The Stanley Works, Allentown, PA June 1, 2000

Key concepts

Storage systems are a simple and relatively inexpensive way to improve efficiency and the bottom line.

Storage needs are broken into four main areas: staging, fabrication, inventory, and assembly.

A vertical lift-automatic storage and retrieval system is often used as a staging station.

A commonly recognized management principle states that productivity is limited by the system. In other words, productivity cannot be increased beyond a certain level without changing the system itself.

Storage systems are among the simplest, least expensive, and most fruitful ways of increasing productivity. They pay big dividends in terms of employee morale, space utilization, and productivity-and ultimately, the bottom line.

Even a casual survey of manufacturing plants shows that there is often much room for improvement in the areas of inventory storage and material handling. Whether establishing new production lines or overhauling existing ones, plant engineers have a great deal to gain from collaborating with material handling consultants or equipment manufacturers who can analyze specific storage, workflow, and space requirements.

Although every plant has different storage needs, most can be understood in terms of four main areas: staging, fabrication, inventory, and assembly. This article concentrates on staging, which is typically the largest and most important of the four for a manufacturing plant. (The remaining areas are explained briefly in the “Other three storage areas” sidebar.)

Staging station

A staging station is the physical analog of the production schedule and clarifies the distinction between preparing for production and executing an actual work order. It ensures that production is market-oriented. Nothing is produced unless there is a purchase from a customer in hand.

The station serves as the control center for production. When a work order is placed, the emphasis shifts from preparedness to rapid fulfillment. Components and subassemblies for a work order are gathered in a tote at one location. Components and parts are moved into the staging station only when an actual order is placed.

Pending work orders and their anticipated delivery dates dictate storage requirements of the staging station. Generally, work orders fall into two categories: rush and advance scheduled. For many products, 40-60% of the customers will pay extra for rapid delivery, meaning two or three days from the placement of the work order. The remaining 40-60% of customers place work orders well in advance and specify a future delivery date.

Just-in-time (JIT) delivery for a customer means advanced scheduling for the manufacturing plant. A customer with a JIT program commonly places the order several months before a planned delivery date and often refuses material prior to the specified date. Therefore, it is necessary to store JIT work orders in the computer for several months before gathering the parts. If the “pull-ahead time” is 2 wk, that work-order location would be created at the staging station 2 wk before the planned delivery date.

The production/scheduling manager regulates material in the staging station by adjusting the pull-ahead time, thereby determining the dates when work orders enter the station. This strategy accommodates rush work orders concurrently with the advance scheduled (or JIT) work orders.

The staging station is at the center of the manufacturing workflow and serves as a clearinghouse for materials channeled from inventory and machining centers. No work order tote is sent to assembly until all the components needed to make a completed device are ready. The staging station and assembly have distinct responsibilities, but they work in harmony.

Typical station

A vertical lift-automatic storage and retrieval system (VL-AS/RS) is a common type of staging station. This system offers over 200 drawers/40-ft unit. Each drawer carries up to 500 lb. An alphanumeric keyboard and display control the system. The operation also can be interfaced with a computer that automatically generates a pick-list for the necessary parts and components. Pulled items are then automatically subtracted from the inventory.

The fact that the vertical lifts are interfaced with a computer makes them especially well suited for use as a staging station. Production workers can work closely with the administrative staff, since the staging station communicates with the same computers used by the production/scheduling department. In some plants, the production/scheduling staff is adjacent to the staging station area, allowing even closer coordination between planning and production.

A staging station often can be installed in an existing plant, because a VL-AS/RS expands up, taking advantage of the space in the upper reaches while occupying a small footprint. Heights range from 12-40 ft.

The single point-of-delivery further simplifies management of the staging station by eliminating the need to search for work order totes. The computer finds the totes and always delivers them to the same location. Production personnel create work order locations at the staging station by affixing a bar code label to a tote. Once done, the work order and its location are synonymous. The staff doesn’t need to keep track of locations. The computer finds and delivers the items based on the work order number.

The vertical lift system and bar code scanner can be linked via a plant floor computer, which automatically assigns locations and manages work order totes.

The first step upon the receipt of a work order is to scan its bar code into the staging station computer, which automatically searches the vertical lift for a vacant location. From that point, the work order number is synonymous with the tote location. When the work order is called up, the computer automatically looks up the tote location and retrieves it. The staff does not have to keep track of the tote location. Assigning a location to a work order can be done with a few clicks of a mouse.

The software program provided with a vertical lift system allows the user to add , store , or pull totes from the system. When a work order comes in, a tote must be added. When the critical components on the pick list have been checked off, the work order tote is removed from the storage system and routed to assembly.

Once the tote is removed from the staging station and sent to assembly, the pull command is used to wipe out that work order from the memory of the computer, making the location available for incoming work orders.

The menu allows some choice over the tote location selection. For example, if there are two vertical lifts side-by-side in the plant, then the user can choose either by toggling between Zone 1 and Zone 2 on the computer screen. The user can also toggle between large and small tote size, and several tote heights (a, b, c, d, and e), corresponding to different drawer heights.

Another option is to allow access at two locations on the same or opposing sides at virtually any vertical elevation. Vertical lift systems can be installed through floors with only the delivery position visible on each floor. Thus, preproduction, including inventory storage systems and fabrication of components, can be located on one floor and production on another with the vertical lift acting as both staging station and conveyor.

If the product requires specially machined components, a separate pick list goes to the machining center. In this manner, machined parts are manufactured and inventory items retrieved simultaneously in preparation for assembly. The machined components are delivered to the staging station and placed in the work order totes, along with “out-of-the-drawer” and off-the-shelf components.

On rare occasions, a work order requires components that are not available in the inventory. Such products must be ordered and corrections made to the inventory stocking policy for those items.

-Edited by Ron Holzhauer, Managing Editor, 630-320-7139,

Adding racks and drawers

Two other types of equipment are often applied in conjunction with the vertical lift for staging and storage.

Stack-racking systems are used for bulky components. A typical configuration includes 4 rows with 11 bays and 12 racks/bay, or 528 locations. A captive-aisle retrieval device with a fork is used to pull material from the racks. Each rack holds up to 2000 lb and is vertically adjustable, so there is no wasted space storing low profile components.

Slow-moving components are stored on the upper racks and accessed using the manually operated fork; fast moving components are stored on the lower racks. The latter can be frequently accessed by hand. Users often progress from simply putting the fast moving items on the lower shelves, to grouping items that typically go together in assemblies, and finally to preassembly of some of the components based on forecasts of work orders.

Modular drawer cabinets hold small and medium parts, which typically account for 70% of the line items in any inventory. Typically there is a 5:2 reduction in space requirements, compared to standard shelving, which translates into more storage in less area.

Vertical lift automated drawer storage systems contain inventory parts, as well as those for staging work orders. A vertical lift system is like a modular drawer system that is up to 40-ft high.

Other three storage areas

Besides staging, three other storage areas are often found in plants: fabrication, inventory, and assembly.

Fabrication of components

A vertical lift system increases productivity in machining centers or metalworking areas by replacing benches and shelves previously spread throughout the facility with a single site.

The vertical lift system in a machining center simplifies training because the new operators don’t need to learn the locations of the special products. It has potential for reducing the number of retrievals/day. In some cases, everything for one job can be stored in one drawer for easy set up.

Another time-saver in fabrication is the use of heavy-duty rollout shelving for very heavy items. Rollout shelving provides overhead access to extremely heavy items. This product makes handling of dies much easier than with traditional pallet racking systems. Shelf capacity is 2250 or 4500 lb in a heavy-duty version. It is modular and easily expandable.

Suspension options include the standard 70% extension, 100% full extension, and the unique double entry 60% extension.

Inventory storage

Even before a work order is placed, materials can flow into storage areas closer and closer to the anticipated point-of-use. Components can be preassembled and routed on the way to producing a completed device.

Pick lists generated from the work orders define materials entering the staging system. There is little room for discretion as to what to include or not include in the staging station. On the other hand, inventory storage prior to work order placement is much more discretionary. Periodic forecasts determine how much material to move into these storage locations.

Ideally, inventory should be minimized and materials flow directly from receiving to production and to the customer with no interim storage. Auto assembly plants often work on the basis of no inventory parts storage. Most other manufacturing plants, however, store components in anticipation of receiving orders. Inventory is costly to maintain but necessary to promptly fulfill work orders and realize efficiencies of scale.

Part of the cost of inventory is the floor space it occupies. Also, the costs of storing and retrieving parts must be figured in the cost of inventory.


When all the parts are ready for assembly, a work order tote can be slid from the vertical lift onto a mobile cart. Totes on a mobile cart can be rolled near a conveyor and slid off the cart onto the conveyor. The assembly area is at the other end of the conveyor.

Small, common items, such as nuts and bolts, O-rings, and fasteners, should also be located in the compartmented drawers of the workstation in assembly areas, in a nearby stationary modular drawer cabinet, or in a mobile modular drawer cabinet.