Research On The Leanization Of MLK Central Distribution Center Process

In recent years, market diversification has resulted in the rapid growth of electronic commerce (e-commerce). With logistics playing an increasingly important role in this new environment, distribution centers have become a crucial link within the logistics network. Under the pressure of insufficient automatization and informationization, many distribution centers in China now face the challenges of low operational efficiency, high operational costs, high employee turnover, and rising customer demand on delivery schedule. These issues bring about lower customer satisfaction and threatening competition. Therefore, how to optimize the logistics process of the Distribution Center and raise work efficiency as well as inventory accuracy become an important topic of study.MLK is a company in the business of cosmetic manufacturing, distribution and direct sales. The company operates its own CDC. Using the MLK CDC as a case study, this thesis will analyze the inbound and outbound material and information flow as well as the current state value chain diagram. By evaluating waste and non-value-added activities, the thesis will then seek to identify the root causes of issues such as slow inventory turnover, long operational cycle time, high work-in-progress inventory, inefficiency space utilization, and duplicated activities. A future-state value chain process flow will be created with the aim of meeting customer demand and facilitating continuous improvement.EIQ analysis methodology will be applied in the design at thesis and the implementation of the improvement activities to move toward the goals of balanced inventory flow, improved sampling, rationalized stock location design, strategic picking design, and efficient replenishment strategy. Utilizing the tools of VSM Analysis and Lean Production, this study seeks to optimize the operational workflow to achieve improved operational efficiency and high inventory accuracy. The application and positive outcome of implementing the lean process at the MLK CDC provides a concrete example that Lean Management can indeed reduce waste and improve work efficiency and inventory accuracy. This is an important testimonial of its potential impact for a logistics operation to reduce operational costs, enhance management proficiency, and increase overall competitiveness.