Decision support for selecting cost-efficient order picking solutions

AbstractEnabled via recent technological advances coupled with the advent of new systems providers and decreased price points, automated and robotized order-picking solutions (e.g., pick-assisting autonomous mobile robots) have evolved as a surging market. Such innovative picking technologies aim to reduce labor costs, use available space more efficiently, and increase throughput rates. As implementation projects and the variety of solutions rise, managers decide which ones to select for their specific warehouse and products. However, comprehensive decision models for this strategic problem are lacking in the pertinent literature. We propose a mathematical optimization model for the novel problem that selects and sizes order-picking solutions and assigns them products and warehouse spaces. Expert interviews are used to identify the decision-relevant costs and constraints comprehensively. Specifically, we minimize setup, module, labor, and error costs while adhering to characteristics related to the area (e.g., available space), technology (e.g., throughput, handling capabilities of certain products), and product (e.g., physical dimensions). We conduct a case study and complement our findings with numerical experiments. We find significant cost reduction potential of up to 57% by selecting a mix of different order-picking solutions. Further analyses highlight the need to retain human workers and to account for maximum labor capacity.Keywords: Automated WarehouseSmart WarehouseOrder Picking SystemRobotic SystemsFlexible AutomationWarehouse DesignDecision SupportFacilities PlanningDistribution CenterMaterial Handling EquipmentDisclaimerAs a service to authors and researchers we are providing this version of an accepted manuscript (AM). Copyediting, typesetting, and review of the resulting proofs will be undertaken on this manuscript before final publication of the Version of Record (VoR). During production and pre-press, errors may be discovered which could affect the content, and all legal disclaimers that apply to the journal relate to these versions also.