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Contents lists available at ScienceDirect

Computers in Industry
j ou rna l h ome p a ge : w ww . e l se v i e r . co m/ l oc a te / c om pi nd

A decision-support system for the design and management of warehousing

systems (Sistem pendukung keputusan untuk desain dan manajemen
sistem pergudangan)
Riccardo Accorsi, Riccardo Manzini *, Fausto Maranesi
Department of Industrial Engineering (DIN), ALMA MATER STUDIORUM - University of Bologna, Viale Risorgimento 2, Bologna, Italy

ARTICLE INFO ABSTRACT

Article history: The issue of material handling involves the design and operative control of warehousing systems (i.e., distribution centres),
Received 24 May 2013 which allow matching vendors and demands, smoothing with seasonality, consolidating products and arranging distribution
Received in revised form 15 July 2013 activities. Warehousing systems play a crucial role in providing efficiency and customer satisfaction. The warehouse design
Accepted 29 August 2013 Available online
entails a wide set of decisions, which involve layout constraints and operative issues that seriously affect the performances
xxx
and the overall logistics costs.

Keywords:
This study presents an original decision-support system (DSS) for the design, management, and control of warehousing
Logistics
systems. Specifically, the proposed DSS implements a top-down methodology that considers both strategic warehouse design
Warehousing systems
Industrial storage systems and operative operations management. The DSS can simulate the logistics and material handling performances of a
Decision-support system warehousing system. Heuristic methods and algorithms address several critical warehouse issues, such as the order picking
Order picking process, which is responsible for 55% of the overall costs in a distribution centre. The benefits due to the adoption of the
Material handling proposed decision-support system are summarised as a dashboard of key performance indicators (KPIs) of space and time
efficiency that allow logistics providers, practitioners, and managers as well as academicians and educators to face real-world
warehousing instances and to find useful guidelines for material handling.

2013 Elsevier B.V. All rights reserved.

1. Introduction and background
In recent years, enterprises have completely reconfigured their supply
chain to address increasing customer service levels and demand variability.
Warehouses play a pivotal role in the supply chain, and requirements for
warehousing operations have signifi-cantly increased. Specifically, the
customer needs in terms of the order accuracy and response time, order
frequency, order quantity and order size have dramatically changed with the
global economy and new demand trends (e.g., e-commerce). The literature
has widely debated the issues of warehouse design and management, which is
aimed at minimising the operation costs and time and increasing the supply
chain performance. Comprehensive surveys on warehouse and industrial
storage system topics have been proposed by De Koster et al. [1], Gu et al. [2]
and Dallari et al. [3].
The main function of the warehousing systems is to receive products
(from inbound or manufacturing lines), to store materials until they are
requested, and then, to extract products from inventory and ship them in
response to the customers’ orders.
* Corresponding author. Tel.: +39 051 2090468; fax: +39 051 2090484.
E-mail address: riccardo.manzini@unibo.it (R. Manzini).
Fig. 1 illustrates a conceptual framework for classifying warehouse
operations, considering the definitions of entities, processes, activities, and
decisions as related to storage systems.
Products typically arrive in large units, such as unit-loads, and standard or
custom containers, or pallets, which cause the related labour and handling
activities to be less expensive. Incoming products must be put away, which is
the most significant warehouse function. The put-away process entails a set of
interdependent decisions [2]: given a warehouse configuration (based on the
layout parameters of Fig. 1), how much inventory should be held for a generic
SKU (the so-called allocation in Fig. 1), and where should it be stored (the so-
called assignment in Fig. 1)?
The warehousing system pursues the transformation of the large and
relatively homogeneous arrival materials into small, frequent and
heterogeneous output quantities in response to customer demands. The small
and frequent output quantities result from the fulfilment of the customer order
lists.
Order picking is one of the prime components of labour and warehouse-
associated costs. Two alternative configurations of layout types are common
for picking. One, the so-called multi-level picking (see Fig. 1), executes high-
level picking directly from storage locations, which are all accessible by
picking equipment (e.g., turret-trucks). The other, the so-called forward-
reserve

0166-3615/$ – see front matter 2013 Elsevier B.V. All rights reserved.
http://dx.doi.org/10.1016/j.compind.2013.08.007
Please cite this article in press as: R. Accorsi, et al., A decision-support system for the design and management of warehousing systems, Comput. Industry
(2013), http://dx.doi.org/10.1016/j.compind.2013.08.007
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Fig. 1. Framework for warehouse design and operation issues.
(see Fig. 1), executes low-level picking from the easily accessible forward
area, which holds the bulk of the inventory for every product in a larger,
reserve storage area. When given a product for which the inventory is low in
the forward area, replenishment is realised from the reserve. For an
exhaustive description of the patterns that are depicted in the proposed
framework, a definition of zoning, batching and routing in warehousing is
given. The zoning comprises partitioning the warehouse into different zones,
which correspond to work stations. Pickers are assigned to zones, and workers
progressively assemble each order, passing it along from zone to zone. The
batching comprises making a picker retrieve multiple orders in one trip. Even
though batching represents a very useful approach to reduce travelling, it
requires the retrieved SKUs be sorted into a single order. Lastly, the routing
defines an appropriate sequence of items on the order list to ensure a good
route through the warehouse.
Overall, two main aspects lead to enhanced performance: the warehouse
design (1) and the operations control (2).
The first aspect refers to the layout constraints and parameters (illustrated
in Fig. 1), the storage equipment and the high-level strategic decisions on the
total inventory of the facility. The second addresses the warehouse operative
activities, such as put-away, replenishment and order picking, focusing on
models, techniques, and methodologies to enhance the operative
performances (e.g., zoning, batching, routing). These two aspects significantly
affect warehouse performances and have a direct influence on the level of
service of the overall logistic chain (i.e., the steps before and after the
warehousing system of Fig. 1).
The literature proposes a wide set of warehouse KPIs that include the
throughput capacity (the material flow processed through the warehouse per
time unit), the storage capacity, the response time (the time within the order
arrival and its shipment), the cost rate, and the cost per unit of material flow
shipped by the warehouse. All of these metrics are affected by the
management of space and time, which are critical for every logistic process.
Generally, the contributions of the literature address the problem of
warehouse design rather than the management of warehouse operations
separately. Gu et al. [2] describe inbound/ outbound processes and review the
literature, classifying the papers on the basis of the scope of analysis, the
adopted method and the type of the observed warehouse (e.g., automated,
conventional multi-aisle storage systems).
Please cite this article in press as: R. Accorsi, et al., A decision-support system for the design and management of warehousing systems, Comput. Industry
(2013), http://dx.doi.org/10.1016/j.compind.2013.08.007
Typically, warehousing problems are non-polynomial (NP) problems and
have a very large amount of real-world data to manage. Therefore, user-
friendly and timeless solutions for the warehousing issues are ambitious aims
for computer-based applications.
The remainder of this study describes the conceptual design and
development of a decision-support system (DSS) for the strategic design and
the management of operative activities in a warehousing system. Specifically,
it supports the design of complex multi-zone forward-reserve picker-to-part
storage systems and provides multi-scenario simulation for KPI assess-ments.
The DSS implements sets of heuristic methodologies to support data-oriented
analyses and performance enhancement.
The management and control of warehousing system (i.e., industrial
storage system) activities and processes range among various design
alternatives and involve different expertise. For example, the problem of
layout design, the definition of the total storage capacity, the determination of
the number of aisles, the types of racks, the locations of the products (i.e.,
stock-keeping-units or SKUs) within the storage area, the stock per each
SKU, and so on, involve interrelated areas and are challenging but can be
addressed through a unique modelling formulation. The majority of the
contributions reviewed in the literature [1–3] focus on a single aspect of the
warehousing problem, thereby ignoring the integration of multi-purpose
approaches.
The proposed DSS develops a top-down methodology for the
comprehensive design of a warehousing system that allows for the decision-
maker to develop and compare different configurations and scenarios in a
user-friendly computer environment. It implements multi-scenario simulation
techni-ques to address real-world case studies, to highlight the
interdependency among decisions and to identify useful guide-lines about
warehousing issues.
DSSs are computer-based tools that have been adapted to support and aid
complex decision-making and problem solving [4,5]. Research in this area
typically highlights the importance of information technology in improving
efficiency adopted by users to make decisions, improving their effectiveness
[6,7]. Specifically, the literature reveals the benefits of using computer-based
systems to support logistics management, especially in the areas of logistics,
transportation, and warehousing [8–10].
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Rouwenhorst et al. [11] and Svestka [12] develop interactive decision
support systems that are aimed at the conceptual design of dedicated storage
systems to store and retrieve pallet loads (i.e., unit loads). Other studies
present tools for managing order picking systems (OPS) (i.e., less-than-unit
loads), which support the analysis of operating data (e.g., the SKU master file,
order master file, inventory master file) to determine the requirements for the
OP operations and storage capacity [13,14].
Currently, the literature does not provide any contributions that can
combine warehouse design and operations patterns into a unique analysis, as
suggested in the proposed DSS.
The proposed DSS is written in a high-level programming language (C#)
that utilises a relational database that can gather, store and manage datasets
from a real-world warehousing instance. Warehousing systems generally
collect tens or hundreds of thousands of SKUs, with customer demands of
millions of order lines per year, while managing inbound-outbound processes,
quality checking, and scheduling shipments. For this purpose, industry invests
in the development of integrated information solutions, which are referred to
as warehouse management systems (WMS). These commercial systems
provide a real-time view of material handling, often advising the efficient use
of space, labour, and equipment [15]. Nevertheless, WMS solutions com-prise
management systems that have no functionalities that are related to decision-
making on warehouse design and optimisation.
The lack of systemic methodology on this topic highlights the need to
provide a DSS that can gather data from real-world instances and implement
sets of effective heuristics to rapidly support decision processes on
warehousing design and manage-ment. The aim of this study is to illustrate an
innovative architecture of DSS for the analysis of warehousing systems while
considering the layout features, storage equipment, allocation and assignment
problems, adopting numerical simulations to assess results, statistics and
performances.
The expected results of the proposed computer aided system can be
exploited by disseminating knowledge among logistic providers, practitioners,
and managers, by educating and improv-ing industrial engineer expertise and
by analysing real-world case studies.
The remainder of this study is organised as follows. Section 2 presents a
design-support methodology for warehousing sys-tems and reports a more
relevant definition of the main leverage of analysis. Section 3 illustrates the
developed DSS functionali-ties through graphic user interfaces (GUIs) and
the data-management section. Section 4 gives a picture of the potential results
and analyses that were conducted through the applica-tion of proposed DSSs
to real-world industry instances. Lastly, Section 5 discusses the conclusions
and provides directions for further research.
2. Solving warehouse design and management issues: a top-down
procedure
The proposed DSS implements a top-down procedure for the design and
management of a forward-reserve OPS, as illustrated by Accorsi et al. [16].
This methodology organises procedures, models, and algorithms in an organic
sequential decision to provide a wide set of solutions for storage layout,
storage allocation, and storage assignment. The decision-maker conducts a
sequence of analyses, generating sets of alternative warehouse configurations
to be assessed through a what-if multi-scenario simulation. The goal
performance is the minimisation of the total travelled distance due to picking,
which represents 55% of the overall warehouse costs. The reduction in the
distance means a reduction in the number of travelling material handling
solutions (e.g., forklifts and guided vehicles) that are necessary to move
materials, a reduction in the
Please cite this article in press as: R. Accorsi, et al., A decision-support system for the design and management of warehousing systems, Comput. Industry
(2013), http://dx.doi.org/10.1016/j.compind.2013.08.007
3
vehicle congestions, parking areas, costs of travelling, mainte-nance, labour,
and other outcomes.
Thus, the feedback flow illustrated in Fig. 2 allows for the user to
rearrange his/her decisions to achieve efficiency in both the warehouse design
and the operations. The following sub-sections focus on the main decision
steps.
2.1. Layout
The first decision involves the design of the warehouse layout. The study
of a warehouse layout is based on the assessment of the facility storage
capacity. The proposed methodology is based on the historical inventory and
customer demand (or the demand forecasts) that are assumed as input for a
stock out risk evaluation analysis that is aimed to establish the required
storage capacity of the warehousing system (i.e., designed from a green-
field).
The purpose of this step is to set the facility layout through the definition
of a set of parameters (see Fig. 1), such as the shape factor, the number of
aisles, the number of bays per aisle, the rack sizes and types, and the
characteristics of the unit load (i.e., the pallet size or other container
solutions). The DSS rationalises the whole storage space by devoting different
zones for different SKUs in terms of the shape and size, which likely require
specific racks or equipment.
2.2. Allocation
The storage allocation strategies establish a fraction of the overall
available storage space in the forward area to be devoted to the generic SKU
according to specific criteria, given a certain time horizon. An equal space
(EQS) strategy devotes the same fraction of space to each SKU, while an
equal time strategy (EQT) ensures the same number of restocks for each SKU
given a selected time horizon. Both of these strategies are renowned in
industry and are suitable for every storage context (i.e., cartons-cases
picking). The optimal strategy (OPT), as proposed by Bartholdi and Hackman
[17] and previously by Hackman and Rosenblatt [18], minimises the
restocking to the forward area for pieces-picking (i.e., the order picking for
the small parts). The proposed DSS implements different so-called allocation
strategies by which to configure alternative scenarios of stock for every SKU.
In the forward area (i.e., the fast-pick area or the low-level locations), the
choice of the stock level to devote to each SKU affects the replenishment
activities as well as the picking processes because this choice influences the
locations of the SKUs [16]. The system also supports a pattern [17] to
determine the sub-set of SKUs that maximise the net-benefit of the forward
area, considering both the time savings per pick (i.e., the pick from the
forward vs. the pick from the reserve) and the time for replenishment.
At this step, the decision-maker matches the allocation results with layout
features and eventually considers the opportunity to return to the top for re-
layout planning.
2.3. Assignment
The storage assignment strategies establish the appropriate locations to
assign to the SKUs in accordance with different heuristics. The DSS asks the
behaviour of selected SKUs within the demand profile for a selected time
horizon. Information on the picking processes is collected to compute a panel
of metrics used for SKU classification. Specifically, an index-based
assignment policy classifies the overall set of SKUs according to the effective
criteria as the popularity (P) (i.e., number of requests per each SKU), the turn-
over (T) (i.e., the ratio of the demand to the inventory for each SKU), the
cube-per-order index (COI), the order closing (OC) (i.e., the ability of an item
to close an order). For a
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Fig. 2. DSS top-down decisional methodology.

detailed description of such heuristics and methods for index-based
assignment policies, a recent literature contribution [16] is recommended.
Another relevant aspect that can be considered through the proposed DSS
is the correlation among the SKUs that are requested together by customers.
Correlated-based assignment policies can be applied to group SKUs that are
requested together and assign them to storage locations that are close to each
other, to save on the travelling needed for the picking activities. The
implemented correlated-based approach comprises the following three main
steps:
Correlation analysis. The level of correlation is generally measured by
introducing a similarity index among the SKUs. This procedure allows
comparing general-purpose similarity indices, e.g., the Jaccard index
proposed by McAuley [19] and certain problem-oriented issues.
Clustering. This step concerns the adoption of hierarchical clustering
algorithms (e.g., single linkage, complete linkage, group
average) and different similarity-cut thresholds of a dendrogram (i.e., value-
based, percentile-based) [20–22].
Cluster Assignment. This step computes the above-mentioned metrics
(i.e., popularity, turn-over, order closing) for each cluster of SKUs (e.g., the
popularity of a cluster is given by the weighted sum of the popularity of the
included SKUs) and to sort the clusters of SKUs accordingly, as summarised
in Accorsi et al. [16].
Regardless of the adoption of specific assignment policies (i.e., index-
based or correlated-based), the assignment step returns a list of SKUs (or a
cluster of SKUs) that are sorted in accordance with the selected criteria, to be
properly matched with a list of locations, ranked by the increasing value of
the single-command (SC) path (i.e., the distance to visit a location from/to a
shipping/receiving dock). The computation of the SC depends on the location
of the shipping and receiving docks (e.g., left/right corner, distributed, same
side, different side) and on the so-called aisle-visiting strategies (i.e., mono-
and bi-directional aisles). To fit the layout constraints multiple (i.e.,
approximately twenty), configurations of

Please cite this article in press as: R. Accorsi, et al., A decision-support system for the design and management of warehousing systems, Comput. Industry
(2013), http://dx.doi.org/10.1016/j.compind.2013.08.007
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both aspects are implemented. Lastly, each SKU is assigned to the most
convenient available location in accordance with a greedy heuristic approach.
2.4. Multi-scenario simulation
The set of decisions that were previously addressed by the DSS (i.e., the
layout design, allocation and assignment) provides a specific configuration
for a warehouse scenario. Multiple iterations of the DSS allow for generating
multiple warehouse scenarios, which differ in their layout configuration,
storage allocation, and/ or storage assignment criteria. In conclusion, a what-if
multi-scenario simulation of operative performances (i.e., travelling for put-
away, replenishment and picking) enables the decision-maker to assess the
best solution for the warehouse design and management by the minimisation
of the total travelling distance, time and cost.
3. DSS functionality and design
The DSS provides a useful and user-friendly tool for managers and
decision-makers who have no background and expertise in programming and
software development but who frequently face warehousing system design
and operations issues. The DSS implements database management system
(DBMS) architectures for data storage, models and heuristic algorithms and
user-friendly graphical user interfaces (GUI) that enable interactive queries,
reporting and graphic visualisation.
The proposed application is based on a stand-alone database. Decision-
process inputs with regard to operative features, costs, and other parameters
are generally handled by practitioners in warehouse operations, whilst outputs
comprise operative KPIs that are usually tracked in the real world (e.g., the
pick-rate, time/ travelling for picking). The SQL database architecture enables
users to gather, store and manage a very large amount of data quickly, which
is gatherable by users through dynamic queries. Further-more, graphical 3D
views of warehousing scenarios are drawn automatically by an ad-hoc
1
graphical user interface with Auto-CAD .
The application is organised around a main GUI that presents all of the
principle features and commands to load data or projects and to save results.
The tool enables the following main functionalities:
Design a new warehousing system (we call green-field).
Import the existing layout (we call brown-field) to perform an allocation-
assignment analysis.
Run the DSS for a complete layout-allocation-assignment analysis of a
generic warehouse zone (i.e., in accordance with warehouse zoning).
Merge single-multiple warehouse zones (i.e., in accordance with warehouse
zoning) as an aggregated system.
Implement heuristics for storage allocation, assignment, single-order
picker-routing, order-batching.
Develop a what-if multi-scenario analysis for the warehousing KPIs.
Draw a graphical 2D/3D warehouse in agreement with different designed
scenarios.
3.1. Database considerations
The DSS utilises the aggregated historical data that is stored in the
database as the foundation for the application of all of the heuristics, methods,
and analyses. This section focuses on the information and data architecture as
a basis of the proposed DSS. In warehouse operations, the very large amount
of data that is to be
Please cite this article in press as: R. Accorsi, et al., A decision-support system for the design and management of warehousing systems, Comput. Industry
(2013), http://dx.doi.org/10.1016/j.compind.2013.08.007
5
handled is critical. Warehousing systems manage tens of thousands of SKUs
that are picked from thousands of locations to fulfil thousands of demand
lines per day (see, for example, spare parts storage and management systems
in the automotive industry). Warehousing activities are usually tracked by
enterprise WMSs. The preliminary step of analysis comprises filtering the
available historical information (e.g., the SKU master file, inventory, demand)
to build a comprehensive stand-alone data-base in accordance with the entity-
relationship (E-R) diagram illustrated in Fig. 3.
The developed DBMS represents an interface between the data and the
decision-maker. This system involves the processing of a considerable amount
of data (see Fig. 4), which is necessary to describe univocally the
characteristics of the warehousing system.
This system comprises a relational SQL architecture that is powered by
TM
Access but is quickly replaceable by any other commercial DBMS (e.g.,
1 1
MySQL , DB2 ). The database includes a set of tables (see Table 1) that
allows for a comprehensive description of the system’s object of analysis
through a typical snowflake structure. Meaningful preliminary studies on the
unified modelling language (UML) and E-R diagrams are crucial to designing
an informative architecture with the tool and to aid in further code
maintenance of the modifications [23,24].
This database architecture has various advantages. First, it enables users
to track the inventory and to localise a generic SKU in both the forward and
reserve storage areas. On the other hand, it allows for a wide set of dynamic
views and queries to create a performance dashboard of the warehousing
system.
The client side comprises a user-friendly interface made by GUIs. The
decision-maker plays opportunities to design a warehouse zone from ground-
zero (i.e., a green-field scenario), to add a new zone to an existing warehouse
(called here an ‘‘expansion scenario’’) or to import an existing storage zone
for an allocation-assignment analysis (i.e., a brown-field scenario).
A what-if multi-scenario simulation of put-away, replenish-ment and
order-picking and outbound (e.g., picking) activities is performed as a
benchmark to assess the efficacy of each scenario and the effectiveness of the
adopted allocation and assignment policies. To enhance the picking
performances, an order-batching algorithm (i.e., whose description is not in
the scope of this paper) based on a clustering approach is implemented as a
batching tool, and a travelling salesman problem (TSP) heuristic (i.e., nearest
neighbour) is developed as a routing tool.
3.2. Graphical user interfaces (GUIs)
GUIs enable the user to conduct analysis and to lead decisions through the
DSS. The main window presents a toolbar to load or save a project. During
any execution run, the user specifies the domain and dataset object of
analysis. Statistics and results are summarised on the bottom of the control
panel as a quick report window to inform the decision-maker about the
computer processing. For each project, multiple ware-housing scenarios can
be developed. A what-if experimental analysis based on a dynamic simulation
can be conducted to compare the performance of the warehousing system
under different configurations and operating conditions. At the end of each
simulation, the obtained results and KPIs are depicted and stored into the
appropriate tables of the database (see Table 1). One of the advantages of
saving the results of each run is the opportunity to draw out effective
guidelines for the design and management of complex warehousing systems.
The GUI comprises distinct modules that are further detailed in the following
sub-sections.
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SKU
ORDERLIST PK ItemCode INVENTORY
PK Period
PK,FK1 ItemCode
PK OrderCode Period PK Period
PK,FK1 ItemCode Description
Category
CartonStockFW
PkdQty CartonLength
CartonStockRS
PkdVolume CartonWidth
ULStockFW
PkdWeight CartonHeight
CartonVolume ULStockRS
CartonWeight
ULCode
WeightPerVolume
CartonPerUL
PiecesPerUL
FK1 WHCode
WH

PK WHCode RACK
PK RackCode
WHType
WHLength
RackType
WHDepth
Aisle Length
Tollerance
Bay MB LOC BaseX
AisleWidth
MBCode PK LocCode BaseY
CrossingAisleWidth PK
BMLength
FK1 WHCode FK1 MBCode
BMWidth
CoordinateX ItemCode
BMHeight
LayerPerBM CoordinateY Carton SCENARIO
ULPerBM CoordinateZ PK SimCode
MBLength
ULPerBMLayer
BMDepth MBWidth
WHCode
RackLevel MBHeight InvMngStrategy
FK1 ColumnCode StorageCapacity
BeamCode ShapeFactor
CrossingCode UL AisleNum
LevelsFW PK ULCode BayNum
FK2 ULCode LocNum
Routing RackLevel
DockIn ULLength
ULWidth PlantLength
DockOut PlantDepth
ULHeight
ULWeight PlantHeight
ULCode
LayerPerMB
ULPerLayer
AisleWidth
SIMULATION OUTPUT VEHICLE CrossingAisleWidth
FWLevel
PK Code PK Code PK VehicleCode AllocationStrategy

AllocationFrom
Period Period Description AllocationTo
WHCode OrderCode VehicleType AssignmetIndex
PeriodFrom Trip VehicleLength AssignmentFrom
PeriodTo ItemCode VehicleWidth AssignmentTo
Batch PkdQty VehicleHeight SimilarityIndex
SimilarityIndex DistanceHz CurveRadius POI1
ClusteringAlg DistanceVt LoadWeight POI2
ThresholdPercentile DistanceHzDockOut LoadUL POI3
ThresholdValue DistanceTotal LoadVolume POI4
VehicleCode Time SpeedHz POI5
OrderList DistanceRestock SpeedVt ClusteringAlg
AccelerationHz ThresholdPercentile
AccelerationVt ThresholdValue
LiftLimit ClusterSorting
WHCode RoutingStrategy
DockIn
DockOut

Fig. 3. E-R diagram of the proposed DST.

3.2.1. Layout GUI
To begin the design of the warehousing system, the decision-maker sets
the total warehousing holding capacity. Given a dataset on the historical
demand or inventory, the user must guarantee the overall level of the stock
and properly organise the available space. The leverage handled through the
proposed DSS for the configuration of the layout are the shape factor, the unit
load sizes, the unit load location, the base module sizes, the aisle width and
number, and the rack types, as illustrated in Fig. 5.
This GUI reports the characteristics of the layout configuration, such as
the total storage capacity, the numbers and sizes of the aisles and bays, the
storage saturation (i.e., the ratio of the storage volume to the overall available
volume), the number of SKUs stored per each aisle or per each bay, etc.
Once the warehouse is designed (or imported), the DSS computes the
three-dimensional coordinates of all of the locations and stores them into the
database (see Fig. 3) for further simulation analysis. The DSS even includes
1
an AutoCAD application, which

Please cite this article in press as: R. Accorsi, et al., A decision-support system for the design and management of warehousing systems, Comput. Industry
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Warehouse
Data Input

SKU Master Order History Inbound Layout

Inventory File
File File Activity File Features File

Item Code Customer Code Item Code Delivery Code Storage Area Code
Item Description Customer Address Snapshot Date Arrival Date Storage Equipment
Category Due Date Stocks Qty per Item Due Date Storage Size
Package Size Item Ordered Storage Area Cross-docking Type of Rack
Sales Price Ordered Qty, Item Code Rack Sizes and
Item Turn Class Weight or Volume Delivered Qty, Properties
Weight or Volume Num. of Locations
Size of Locations

Fig. 4. Data required to develop a DSS for warehousing issues.

adopts real-world rack libraries to make a bi-dimensional and three-
dimensional picture of the warehousing system.
Specifically, this application allows for analysts and logistics providers to
import rack components (e.g., beams, columns) that are taken from
manufactures’ catalogues and configure a truthful and accurate warehouse
layout. The system evaluates the maximum load weight of the inventory and
checks for the availability of appropriate rack components that are suitable in
their sizes and characteristics. Fig. 6a gives a picture of some three-
dimensional views of warehouses that result from the DSS application. As a
result, the detailed list of parts is given as a rough estimation of the total
investment.
3.2.2. Allocation GUI
This GUI allows for the user to compare different allocation strategies that
were attempted to allocate the appropriate storage volume to a generic SKU
within the forward area for a typical forward-reserve picker-to-part OPS. The
DSS encompasses four main allocation strategies, three of which were
previously described in Section 2.2; one is hereby proposed, the so-called
EQT*, which allocates the appropriate storage space to each SKU considering
the demand in terms of the retrieved volume and pick lines. This module has
an open architecture that eventually allows an easy implementation of other
additional allocation strategies.
Fig. 7 illustrates the GUI such as is proposed to the decision-maker. On
the left, two input command windows (‘‘Rack Level (n.)’’ and ‘‘Allocation
Strategy’’) are presented to define the number of rack levels that are devoted
to the forward area and to select the allocation strategies by which to adopt.
Thus, the user has the opportunity to configure a low-level or high-level
picking system and assign the highest levels to the reserve storage area.
The calendar panel (on the left of Fig. 7) selects the horizon of analysis,
by filtering the dataset through dynamic SQL queries. Different time batches
are selected to compute the fraction of the storage volume that is devoted to
each SKU according to the historical demand and inventory data. For
example, given a temporal batch (from August 31st, 2011 to September 28th,
2011), a panel of allocation strategies accordingly allocates to every SKU the
storage volume, cartons, and unit loads within the forward area (see the tables
in the middle).

Table 1
DSS database tables.

Data
SKU Contains data regarding the SKU’s properties and characteristics and generally accounts for ten thousand rows
ORDERLIST Contains the order history file of a horizon of analysis (e.g., a couple of years) and generally comprises millions of lines
INVENTORY Includes the inventory file for every SKU for all of the storage areas. Multiple inventory snapshots report the stock trends
WH Involves properties and features of the layout and storage areas (e.g., the shape factor, rack size, number of aisles and bays,
number of levels, location sizes). Through such a table, the DSS imports an existing warehouse system to be evaluated
according to allocation-assignment analysis
MB Includes the list of bays within the warehouse
UL Contains the properties and characteristics of the holding units and pallets in which the items are stored
LOC Reports the list of locations with details on the bay, level, aisle, filling product and related quantity
RACK Describes the type and characteristics of the commercial rack uploaded into the database. The sizes and load tolerance are reported
SCENARIO Summarises the setting of the layout leverage, allocation and assignment policies and all of the parameters and choices selected by
the decision-maker through the top-down analysis methodology. The results from each scenario by iteration are illustrated in Fig. 2
VEHICLE Includes the list of storage equipment (i.e., vehicles) and the related properties in terms of the operative performances
SIMULATION Reports the list of simulations that were conducted by the decision-maker. Multiple simulations might refer to different scenarios,
to compare their performances or to different time horizons adopted for the same scenario (i.e., to assess the trend in the
performances for a scenario)
OUTPUT Summarises the statistics of the simulation in terms of the travelled distance and time for each line of inbound (i.e., put-away,
replenishment) and outbound (i.e., picking) activities

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Fig. 5. Layout GUI.

Storage space is often a precious resource to be handled, to reach
efficiency and reduce operating costs. At this step, the decision-maker can
evaluate the net benefit of the forward area, according to the pattern that was
briefly introduced in Section 2.2. The sub-set of SKUs, which maximises the
net-benefit of the forward area, corresponds to the maximum value of the
curve depicted in Fig. 7.
If an existing warehouse zone/system is imported and loaded, the AS-IS
inventory per each SKU (i.e., the number of cartons and unit loads in both the
forward and reserve areas) is known, and related data are stored into the
database. Thus, the user can skip the allocation module, which is not
considered as leverage of the analysis, leaping from the layout design module
directly to the storage assignment problem.
Once the appropriate location in the forward area is assigned to a specific
SKU, the reserve area is accordingly arranged by the adoption of greedy
heuristics to reduce the distance between an item and its reserve.
The results of the assignment module are store into the database and are
roughly illustrated as the bird’s eye view of the designed warehouse zone. The
bird’s eye view is a frame shot of the SKU locations, where each SKU is
differently coloured, and the storage details (e.g., the location code, item
code, and number of cartons per item) are summarised. The DSS also fills the
rack with the SKUs in the designed layout in a three-dimensional view (see a
sample in Fig. 6b). By considering real commercial racks, the decision-maker
obtains a ready-to-print version of the designed warehouse that is useful for
equipment and systems manufac-turers and providers as well as warehouse
operators who are responsible for put away and picking activities.

3.2.3. Assignment GUI

This GUI leads the decision-maker towards the assignment issue by the
definition of the appropriate location to assign to a generic SKU in the
forward area. Considering the horizon of analysis (i.e., the same chosen for
allocation analysis or different), the user classifies SKUs according to a set of
proposed criteria or metrics (i.e., the index-based functionality), to assess the
correla-tion among the SKUs (i.e., correlation-based functionality) through a
clustering approach.
Both of the opportunities compute a ranked list of the SKUs (eventually
computing clusters of SKUs), respond to specific criteria (see the previously
cited popularity, turn, and order closing), to be properly matched with a list of
locations, according to the procedure presented in Section 2.3. More than
twenty combinations for the sites of the shipping and receiving docks (e.g.,
corner, middle, bottom-up) that affect the single-command time to access a
generic location are considered.
3.2.4. Simulation GUI
In warehousing operations, different categories of SKUs in terms of the
shape, volume, weight or size of packaging are assigned to different zones,
adopting different types of rack or storage equipment according to a zoning
approach. Several configurations for the storage zones, separately and
independently designed through previous GUIs, are hereby saved and are
further selected by the decision-maker to be merged into a unique system (see
Fig. 8a).
This GUI enables us to configure articulated and complex warehouses that
are made by different storage zones, as commonly occurs in real-instance
warehousing problems (exem-plified in the literature by [25]). Furthermore,
this GUI matches the decisional steps with what-if simulation analysis. By
setting the layout (i.e., merging the warehouse made by one or multiple

Fig. 6. (a and b) Three-dimensional views of warehouses designed with the DSS.

Please cite this article in press as: R. Accorsi, et al., A decision-support system for the design and management of warehousing systems, Comput. Industry
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Fig. 7. Allocation module of the DSS.

storage zones), the decision-maker imports the location coordi-nates for each
zone and arranges them according to the overall warehouse layout
configuration.
The DSS calculates, for every location, the forward area and reserves the
travel path (in terms of distances) from the shipping and receiving docks and
those from/to each other (see Fig. 8b).
The what-if simulation analysis involves inbound (e.g., put-away,
restocking) and outbound (e.g., order picking) operations and provides a
useful tool to assess system performances, including costs (i.e., in terms of the
travelled distance and time) within a specific horizon of analysis. The DSS
reports a complete panel of statistics and KPIs to evaluate the efficacy and
efficiency of the layout, allocation and assignment configuration. A list of
statistics includes the travelled distance (horizontal and vertical) and time due
to pick-path, travelled distance (horizontal and vertical) due to put away and
replenishment, time waste due to stock-out, number of replenishments per
each SKU, number of visited aisles, as a metric of the vehicles congestions,
spatial pick-density, and other aspects.
4. Case study
In this section, the proposed DSS has been applied for the design and
performance assessment of a real-world warehousing system. In particular,
this case study addresses a spare parts management system for an
international brand of the automotive industry. A logistic firm operating
worldwide provides the logistics services of transportation (inbound and
outbound) and warehousing for an important automotive company to supply
the demand of spare parts to hundreds of Italian dealers. This system is a
regional distribution centre (RDC) that accounts approximately 8000 SKUs as
spare parts, ranging from bonnets to screws. The high variability of SKUs in
size, weight, and shape is typical for automotive industry, and requires proper
storage management practices. The analysed system accounts twenty-four
aisles arranged in a multi-zones warehouse, which holds four storage zones
grouping homogeneous SKUs in size and shape of unit load and similar in
weight. Each storage area presents a different type of racks, which is suitable
to allocate a specific set of SKUs (e.g., cantilever for door, bin shelving for
air-filter, etc.).

Fig. 8. (a and b) Simulation GUI: pre-setting.

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The observed low-level single-order picker-to-part and forward-reserve
OPS represents a relevant sample to assess the effectiveness of the proposed
tool. The receiving and shipping activities are decoupled and limited
respectively to the left and right of the dockside. Although the receiving and
shipping docks are distributed along the warehouse side, the picking process
starts on the bottom left corner of the system and the ends on right bottom
corner. These two control points represent respectively the parking of walkie-
stackers and roll-containers and the sorting/packing station for the orders to
be shipped. The low-level storage area (i.e., the forward area) is 25,000
square metre wide. Customer orders, made by many order lines, accounts on
average 37 lines, results in long time-effective picking missions, since the
pickers has to achieve in sequence products which are far located one from
the others. The presence of narrow aisles does not allow reverse back, and the
‘‘traversal’’ visiting strategy is adopted either in real world than in the
simulation.
The complexity of the system bases on the disomogeneity of both the
SKUs and the processes. The increasing complexity of modern supply chain
shifts the role of warehousing systems in addressing demand variability,
pushing logistic providers to handle both homogeneous and heterogeneous
flows. Such a trend results for the observed warehouse in articulated inbound/
outbound operations, which include the truck unloading, the check of loads,
put-away and replenishment, and the order picking. A dashboard of KPIs
involving put away, replenishment and order picking missions allows the
decision-maker to address operative criticalities and propose strategies for
both layout re-design and operations improvements.
Table 2
The results of a multi-scenario analysis.
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The DSS implements a what-if multi-scenario simulation to compare how
different allocation and assignment strategies affect the performance of the
inbound/outbound operations in the observed warehousing system. The
simulation analysis does not involve layout leverage, which is common to any
proposed scenarios, since the client had no budget for layout re-design or
infrastructure refurbishing. For sake of brevity, the comparative analysis
regards just with the reduction of travel distances, as an approximation of the
operative time.
Table 2 illustrates the results of a simulation campaign conducted on the
historical set of inbound/outbound annual operations, which account about
970,100 picking lines, and 25,500 replenishment missions. The colours
yellow, red, and blue refers respectively to the layout, allocation and
assignment steps of analysis implemented into the DSS (see Fig. 2).
The overall warehousing system is composed by the four storage areas,
which are independently designed in accordance with the allocation and
assignment policies. In particular, the warehouse scenarios are organised
through the adoption of the following rules and parameters:
3 allocation strategies (i.e., EQS, EQT, OPT).
4 assignment strategies (i.e., popularity, COI, turn, OC). 1 visiting
strategy (i.e., traversal).
1 routing heuristic strategy (i.e., nearest neighbour).
Different allocation strategies result, first, in different values of total
replenishments within the observed horizon of time, and second, if combined
with different assignment strategies, in influencing the location of the SKUs
in the forward area, thereby
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Table 3
Some tips from DSS implementations on real case studies.

Profile Case 1 Case 2 Case 3

Client business Grocery/catering Automotive Heavy machinery
Product category Food/drinks Spare parts Spare parts
Client role Warehouse owner 3PL Warehouse owner

Complexity
Picking approach Carton-picking-by-pallet Carton-picking-by-pallet Carton-picking-by-pallet
Warehouse system Forward-reserve Forward-reserve High-level forward
# SKUs 1667 7386 3235
# Storage area 3 4 1
2
Storage area (m ) 9000 25,000 5500
Observed period (months) 12 12 6
Picking (lines/period) 19,953 970,147 37,000
Replenishment (lines/period) – 25,426 –
Put-away (lines/period) – 44,729 –

Purpose
Allocation Allocation Allocation
Assignment Assignment Assignment

Results
Simulated period (months) 6 12 4
Simulated process Picking Picking; Replenishment; Picking
Best Scenario EQS; Correlated & P EQS; P EQS; COI
Travelling savings (D%) 18.11% 16.73% 22.57%

affecting the total travelled distance for all inbound/outbound operations. The
illustration of the alternative warehouse scenario allows the decision-maker to
recognise the influence of decisions on SKU allocations and assignments in
both the forward and reserve storage areas. The saving of replenishment
missions occurred by EQT and OPT strategies, are not enough to justify their
implementation considering the overall costs. Indeed, the combi-nation of an
EQS strategy and popularity rule accomplishes reducing the total travelled
distance primarily because of the picking activities.
This section gives a picture of the potential multi-leverage analyses
conducted through the proposed DSS. Significant time-savings can be
generated by a re-allocation and re-assignment of SKUs within the forward
area of a multiple zones warehousing system. In the following section, the
potential applications of the proposed DSS will be described with the focus
on the enhancement opportunities in tackling real world instance and both
strategic and operative warehousing decisions.
5. Discussion
Despite of the increasing trend of lean paradigm in production and
distribution operations, warehousing systems are still neces-sary to address
the demand variability and seasonality, to match vendors and consumers in
global trade, to hold products and sustain the customer service level. The
reduction in demanded quantity joined by the customization of items, results
in raising the complexity of the warehousing operations, which are called to
achieve high performances and to make goods travelling fast throughout the
distribution pipeline.
The proposed DSS supports the decision-maker in addressing warehouse
operations, which are highly dependent by a broad set of factors including the
layout, the storage equipment and infrastructure, the set of SKUs,the order
profile, the SKUs turnover, the routing policies for put away and picking
missions, the goal performances in terms of time efficiency, space efficiency
or both.
The implementation of this tool for real-world instance has different
purposes. First, it supports the decision-maker in handling long-term strategic
decisions, based on the estimation of requirements of space and investments
(i.e., costs for racks and storage equipments) necessary to arrange a new
storage area from
green-field. Second, it addresses mid-term tactical decisions, involving the
definition of the storage areas devoted to picking rather than bulk storage (i.e.,
forward-reverse low-level system vs. high-level system), the size and shape of
each storage area, and the opportunity to set multiple storage areas dedicated
to different classes of SKUs. Tactical decisions include also the analysis of the
appropriate storage quantity to allocate to each SKU, thereby affecting the
reorder quantity from the distribution nodes at previous stage of the supply
chain. Third, the DSS handles operative short-term decisions, based on the
assignment strategies of SKUs to locations, the definition of the best
performing routing policy, the selection of the retrieving strategy to adopt
(i.e., single-order vs. order-batching). The what-if multi-scenario simulation
analysis assesses the operative performances of each scenario, providing
improvements solutions and enhancement guidelines with operative, tactical
and strategic horizons of analysis.
Based on the described functionalities, it provides various levels of
assistance to different users. Specifically, the DSS supports the third part
logistic (3PL) managers in facing daily concerns on the management of
multiple-client storage systems, characterised by high-variability in items,
storage racks, and turnovers. The tool depicts a detailed dashboard of the
operative performances of a generic storage area (i.e., a generic client), with
suggestion for tactical and operational improvements and tips for scheduling
labour among different areas. Furthermore, the DSS offers to warehouse
owners the opportunity to simulate the operative savings (i.e., time, costs, and
space) achieved by the combination of allocation and assignment strategies,
which results in changing approaches for the management of SKUs slotting.
Finally, the DSS allows researchers approaching different real case studies,
testing the effectiveness of models and heuristics on providing performing
solutions and creating knowledge over the most critical and recurrent storage
issues.
Table 3 reports the obtained results by the implementation of the DDS
with three real case studies. These profiles were selected as the basis for
system validation since they were most representative for computational
complexity and robustness of enterprise datasets. Systemic analysis of the
three profiles identifies major opportunities for improvement over the AS-IS
scenario. The three profiles differ for the industrial sector of application, the
set of SKUs, the purpose of the client and the related implemented analyses.

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Despite of the observed business, the DSS tends to support the grouping
of the fast-moving SKUs, grouped per affinity (i.e., Case 1), per popularity or
cube-per-order index (i.e., Case 2 and Case 3), within the most convenient
storage areas, thereby eliciting the need of dedicated golden areas, potentially
supported by different types of technologies (i.e., conveyor, semi-automated
storage/ retrieving systems). The tool properly arranges the available storage
space for both forward-reserve and high-level storage systems, involving the
design of different storage areas, which increases the pick density and space
efficiency of the system.
6. Conclusions
An original decision-support system for picker-to-part storage system
design and operations management is illustrated. The proposed DSS
comprises a user-friendly tool for supporting practitioners, managers,
decision-makers, and logistics providers by addressing real case studies and
experimental analyses over the design and operations control of the storage
systems. This tool enables us to gather and store information from enterprise
WMSs and to elaborate, through an efficient DBMS architecture, a set of
data-oriented design solutions and configurations. The tool aims to design
multi-zone storage systems and implements a wide panel of algorithms and
methods that address different stages of analysis (e.g., storage allocation,
assignment, batching, zoning, routing). Results and statistics on performances
and costs due to a generic warehouse scenario are computed through a what-if
simulation analysis. An implemented graphic interface draws two-dimen-
sional and three-dimensional views of the designed storage scenario, adopting
real commercial rack components with the purpose of providing a ready-to-
print release of the warehouse for logistic providers and engineers.
Further developments are expected on the implementation of innovative
methods, models and algorithms, to address warehouse layout, storage
allocation and storage assignment issues in the presence of automated storage
solutions and equipment for part-to-picker systems (e.g., automated storage
and retrieval systems (AS/RS), mini-load, carousels).
A useful module, integrating a cam interface for barcode reading, could be
implemented to support the introduction and registration of new SKUs and
the updating of the enterprise SKU master file. This functionality might
respond to the problem of periodical and partial storage rearrangement rather
than overall warehouse redesigning.
The educational purpose of this work is to provide a set of flexible
interactive instruments to create and disseminate knowledge among logistic
providers, practitioners, and managers, and to improve industrial engineers’
backgrounds and expertise over the most critical storage issues. Lastly, the
designed tool, similar to any other computer-aided system, attempts to
support, but not replace, the decision-maker, who responds daily to strategic
design and operations management within a storage system.
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Riccardo Manzini is Associate Professor of ‘‘Logistics and Operations’’, ‘‘Reliability
& Maintenance’’ in the Department of Industrial Engineering at the University of Bologna
(ALMA MATER STUDIORUM), Italy. His academic research principally deals with planning,
design and control of production systems with particular reference to logistics and operations,
optimisation and decision support systems, reliability modelling and maintenance. He is the
author of about 130 published papers on production systems, logistics and reliability. Director
of the ‘‘Warehousing Center’’ and the ‘‘Food Supply Chain Center’’ at Bologna University.
Author and Editor for Springer of the book ‘‘Warehousing in the Global Supply Chain.
Advanced models, tools and applications for storage systems’’ (2012). Editor of the Special
Issue ‘‘Decision models for the design, optimisation and management of warehousing and
material handling systems’’ (IN PRESS 2013) for the International Journal of Production
Economics, Elsevier. He has carried out several research projects in cooperation with – and
funded by – private and public companies on logistics, industrial plants and maintenance
problems.
Riccardo Accorsi is post-doctoral researcher at Department of Industrial Engineering of the
University of Bologna, Italy. In 2013, he defended his Ph.D. in Mechatronics and Industrial
Systems at the University of Padua, Italy. He received a Master degree in Management
Engineering at the University of Bologna, Italy, in 2009. His main fields or research are
modelling and simulation applied to industry and supply chain context, with particular focus on
warehousing systems and distribution networks enabling product lifecycle management.
Fausto Maranesi is a researcher at Department of Industrial Engineering of the University of
Bologna, Italy. In 2011 and 2009, he received respectively a Master degree in Management
Engineering and a Bachelor degree in Informatics Engineering both at the University of
Bologna, Italy. His current research interests include warehousing modelling and simulation and
computer applications for manufacturing and logistics issues.