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British Airways Avionic Engineering Ltd.’s Warehouses Case Study


Abstract

Automated Storage and Retrieval System has become one of the very popular systems used in managing materials in warehouses. Soon after designing its new warehouse, the management of the British Airways Avionics Engineering realised that they needed this tool to enhance efficiency and cut costs of their operations. This study has revealed that the system was indeed appropriate for this firm at the time of its implementation. The study has also identified several deficiencies in the layout of the firm’s new facility. The main issue identified was the use of vertical space.

Introduction

The British Airways Avionic Engineering Limited (BAAE) was founded in 1993 as a subsidiary of the British Airways Group (Pathak 2005). The firm has its headquarters in Llantrisant, Wales, and it specialises in the repair of avionic equipment for British Airways. According to Tan (2002), this company was established as a way of reducing overreliance on other companies to handle repairs at this firm.

The new subsidiary grew rapidly as it had a major client which was also the parent company. One of the main issues that this firm faced soon after starting its operations was effective warehousing strategies. Most of the equipment and spare parts require proper storage to ensure that they are protected from damage and rust. As the firm grew in size, its inventory also increased considerably and the management realised that much time was wasted in the warehouses.

Sometimes the firm would be forced to purchase parts and equipment that were available but misplaced within the warehouse. This was a serious impediment to the success of this company given that the client was becoming a dominant player in the aviation sector. According to Reeves (2008), for a long time, many companies have always ignored the need to develop technology-based systems to manage inventories in their warehouses.

For British Airways Avionic Engineering Limited, a time had come when it had to re-evaluate its warehousing strategies and find the best ways of using modern technologies as a way of achieving success. One of the most appropriate technology-based systems that were available for this firm was the Automated Storage and Retrieval System (AS/RS). In this paper, the researcher will critically analyse the relevance of this system for this firm.

Automated Storage and Retrieval System (AS/RS) as the most cost-effective and efficient warehouse handling system

The British Airways Avionic Engineering Limited handles a wide variety of equipment and spare parts meant for the maintenance of the British Airways’ planes (Meghanathan, Nagamalai, & Chaki 2013). As shown in the case study, these items are very sensitive and require handling with care. It is, therefore, very important to come up with a warehousing system that can meet the specific needs of this company. Automated Storage and Retrieval System is the most cost-effective and efficient warehousing system for this firm because of the following reasons.

This computerised system keeps data of every item that is within the warehouse specifying the quantity, quality, and any other relevant information. In the past, this company relied on manual records to store such information, and sometimes it was not easy to retrieve the required information as per the required efficiency. Automated Storage and Retrieval System has solved this problem. It made it possible for the data needed to be retrieved without any difficulty.

The management also knew what was available in the warehouse and what needed to be replaced (Wang 2009). This system has also helped in addressing one of the major problems of buying items that were still available within the firm. Sometimes the firm would be forced to purchase new spare parts and equipment simply because those that are available were misplaced. The company was also finding it problematic knowing when important equipment and spare parts needed to be purchased. The poor recording system made it difficult to know when it was necessary to look for additional resources.

Within the warehouses of the British Airways Avionic Engineering, there was a problem of constant damages due to physical handling by the attendants. This was costing this firm a lot because every time an item was broken, it had to be replaced. The case study gives a clear example of how the handling of the items within the warehouse was not only physically demanding for the employees but it was also costing the firm a lot due to the damages.

The use of AS/RS has offered a perfect solution to this problem. The attendants no longer have to handle these tools and equipment. Everything is controlled remotely using a computer. When there is an item within the warehouse that needs to be retrieved, the instruction is fed into the system. Using the conveyor belt, the specific item would be moved from the position where it was stored to the point where it should be picked without any manual labour. This has significantly reduced cases of damage to materials within the warehouse.

This system is very cost effective for this firm. Since the initial cost of installation is high, once installed the system eliminates the need for attendants to handle goods in the warehouse. Most of the physical activities previously done by employees can now be done by the machine. It means that the cost of labour will be reduced significantly within this firm. These are reasons that justify the relevance of this system for the British Airways Avionic Engineering. It is also important to note that this system plays a critical role in strategic management (Jessop, Morrison & Morrison 2005). It provides management with information such as the flow of inventories which can be used to make important decisions.

Deficiencies in the layout of new BAAE’s facility in Llantrisant

The layout of the new British Airways Avionic Engineering was designed precisely to function under the new Automated Storage and Retrieval System that the firm had just employed. According to Moore, Grammich, and Bickel (2007), AS/RS is a unique warehousing system that cannot work in poorly designed warehouses managed through manual labour. It needs a layout that will make it easy for the conveyor belts and other components of the system to coordinate very closely and ensure that instruction issued is followed efficiently.

That is why the management of this firm considered having a new facility that would meet the basic expectations. It is important to appreciate the good work that has been done in coming up with the layout. The designer was also interested in coming up with a beautiful structure besides the issue of functionality. However, this new layout designed in 1995 had several fundamental deficiencies that reduced its functionality.

As shown in the design, one of the biggest deficiencies in the layout of the new facility was space utilisation. According to Taniar and Rusu (2010), in the past emphasis was laid on the size of the warehouse in determining its capacity. However, this has changed in modern society that is highly based on technology. Emphasis is now laid on the inventory turnover rates and efficiency. The design given in the case study has not maximised the use of available space as would be expected given that this firm was planning to fully implement Automated Storage and Retrieval System.

Given the scale provided in the figure, it is clear that the distance between the east wing and the central command center is over 15 meters. The same space has been left between the central command center and the west wing. It means that the layout has been spread within the compound. This is a design that goes against the modern-day designs where architects and engineers are keen on taking advantage of the vertical space instead of the horizontal space.

As the population continues to increase, pressure on the horizontal space continues to increase. As such, designers are keen on taking advantage of the vertical space, something that was not taken into consideration when developing this design. As Morrison and Jessop (2006) say, warehouses that embrace Automated Storage and Retrieval System are expected to maximise on the horizontal space more than the vertical space. This is so because most of the goods in the warehouse are handled by machines. These machines work more efficiently in the vertical space than they do in the horizontal space.

The layout shows that the automated warehouse is in the middle of the two main workshops. This might have been designed purposefully to ensure that materials can move to either of the workshops with ease. However, this may be considered a deficiency despite the rationale. Since most of the physical activities will be done by the machine, an engineer should be concerned about the amount of energy that will be used when the system goes operational.

If the layout involves more work per unit for the machine, then it also means that there will be more energy use per unit. As stated above, the distance between the central command center and the two wings which are the workshops is over 15 meters. What this means is that the machines will use more energy even when delivering a small item from the store to another. The layout should have been designed in a way that each of the two workshops has its warehouses.

Both of them can be controlled from the command center to make coordination of activities easier. These two workshops are responsible for distinct functions in the repair and maintenance of the planes. As such, it is known the type of equipment and spare parts needed in each of the two warehouses. It will be reasonable to reduce the distance covered in delivering products to the targeted area. These fundamental flaws in the layout of the new warehouse can be attributed to the emphasis that was laid on the beauty of the shape. The identified weaknesses should be avoided when coming up with future designs for this firm.

The most effective internal distribution system for BAAE in the new facility

British Airways Avionic Engineering’s new facility needs an effective internal distribution system which will ensure that goods move from where they are stored to places where they are needed. According to Crocker, Jessop, and Morrison (2011), several systems are currently used in ensuring that there is an effective distribution of the materials within the stores and from the stores to the workshop.

Given that the management has decided to automate its warehousing activities, Automated Storage and Retrieval System would be the most appropriate for this firm. As suggested above, the physical gap between the warehouse and the workshop should be minimized as much as possible. When this is done, it becomes possible to move items through the system from the warehouse right to the workshop. This system is recommended because of the number of benefits it offers.

When this system is used effectively, the need for human labour will be significantly reduced. Most of the tasks previously done by the employees will now be done using the system. It means that occupational safety will be enhanced within this firm because the risk of people getting physical injuries in the stores will be significantly reduced. The costs of compensations and treatment of such employees will also be eliminated. The warehouse and the workshops will, therefore, be run cost-effectively.

Compact picking of materials is a task that can be very challenging when it is done using manual labour. This is so because the capacity of humans is always limited in terms of the amount of weight they can carry. However, this is not the case when the Automated Storage and Retrieval System is used. The system makes it easy for a compact of materials to be delivered to the desired location within the warehouse or workshop irrespective of the weight. This capability of the system enhances efficiency in internal distribution.

As shown in the above discussion, the Automated Storage and Retrieval System is multipurpose. It goes beyond ensuring that materials are safely stored within the warehouses. It also takes care of the internal movements and automatic stock-taking within the warehouse. According to Wasserman and McLean (2003), organisations are currently keen on embracing systems that can perform more than one task. This is one way of reducing the costs of production.

The British Airways Avionics Engineering will benefit a lot from this system in terms of efficiency and cost-effectiveness. As Treebhoohun (2011) notes efficiency and cost-effectiveness are issues that are critical in the aviation industry. This firm is often under pressure to ensure that the planes of its parent company are serviced in time and as per the expected standards. The maintenance process should also be conducted using the least cost possible to ensure that operations of the firm are conscious of the need to be profitable.

Conclusion

The British Airways Avionics Engineering was established with the primary purpose of offering repair and maintenance services to British Airways, its parent company. Soon after starting its operations, the management of this firm realized that it needed an inventory management system that does not heavily rely on human labour. Automated Storage and Retrieval System came out as the most efficient system that could address the challenges faced in managing the materials in the warehouse. The system not only increases efficiency in operations but also reduces the overall cost of operation.

References

Crocker, B, Jessop, D & Morrison, A 2011, Inbound logistics management: Storage and supply of materials for the modern supply chain, Pearson, Harlow.

Jessop, D, Morrison, A & Morrison, H 2005, Storage and supply of materials, ELBS with Pitman, London.

Meghanathan, N, Nagamalai, D & Chaki, N 2013, Advances in computing and information technology: Proceedings of the second International Conference on Advances in Computing and Information Technology (ACITY), Springer, Berlin.

Moore, N, Grammich, C & Bickel, R 2007, Developing tailored supply strategies, Rand Corp, Santa Monica.

Morrison, A & Jessop, D 2006, Storage and control of stock: For commerce, industry and public undertakings, Pitman, London.

Pathak, J 2005, Information technology auditing: An evolving agenda, Springer, Berlin.

Reeves, L 2008, A manager’s guide to data warehousing, Wiley, Hoboken.

Tan, F 2002, Global perspective of information technology management, IRM Press, Hershey.

Taniar, D & Rusu, L 2010, Strategic advancements in utilising data mining and warehousing technologies: New concepts and developments, Information Science Reference, Hershey.

Treebhoohun, N 2011, Promoting IT enabled services, Commonwealth Secretariat, London.

Wang, J 2009, Encyclopedia of data warehousing and mining, Information Science Reference, Hershey.

Wasserman, P & McLean, J 2003, Consultants and consulting organisations directory, Gale Research Co, Detroit.

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IvyPanda. 2020. "British Airways Avionic Engineering Ltd.'s Warehouses." September 2, 2020. https://ivypanda.com/essays/british-airways-avionic-engineering-ltds-warehouses/.

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IvyPanda. (2020) 'British Airways Avionic Engineering Ltd.'s Warehouses'. 2 September.

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