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HOW CIRRUS LOGIC MAKES
THE MOST OF A MOVE
A work-in-process system based on carousels
drives the operation. Packaging on the mezzanine
adds a space-saving benefit.
How does one of the fastest growing
integrated circuit (IC) manufacturers meet inventory and
distribution needs when sales increase at a rate of 50 percent a
year and when you're running out of space at your main distribution
center?
Cirrus Logic manufactures chips that control computer hard disk
drives, display graphics, digital and analog audio, video
processing, wireless communications and other peripheral functions
of personal computers and workstations. It supplies chips to leading
computer companies like Apple Computer Inc., IBM Corporation, Zenith
Electronics Corporation, Dell computer Corporation, Compaq Inc. and
others. The company receives product from several suppliers located
throughout the world.
The challenge at Cirrus Logic was not only to keep up with its
phenomenal growth, but also to deliver fully tested 100% defect-free
integrated circuits on time. Shipping defect-free ICs is a necessity
at Cirrus Logic, which knows that in its booming markets, nothing
less than 100 percent is acceptable; "zero defects" is its goal.
Cirrus Logic realized that in order to continue growing, it needs to
remain on the cutting edge of technology and continue meeting
customer delivery demands. In many cases, this means processing
same-day orders.
To meet the demands of growing distribution, Cirrus Logic pulled
together an automated material management system to replace the
manual order-picking system the company had been using from the
start.
Development of the Cirrus material management system began in
January 1992. At that time, J.D. Streeter, senior manager of
materials a Cirrus, was told that company would be moving its
distribution center from Milpitas, California, to a new facility in
a predesigned building in Freemont.
Incoming material and work-in-process in totes are
moved in
and out of carousel storage by conveyor during processing.
"I couldn't see moving a manual operation to the new
facility," said Streeter. "I knew I had roughly the same amount of
space to work with at the new facility as I did at the old facility,
in terms of square footage. We had to move the entire operation and
plan for a system that would accommodate an aggressive growth
forecast."
After interviewing several contractors, Cirrus chose Warehouse
Engineering of San Jose, California, for the project.
Warehouse Engineering began with a study of Cirrus Logic's
distribution requirements and inventory volumetrics.
They analyzed:
- The number of SKUs in inventory;
- Inbound and outbound shipping activities
- Delivery frequencies;
- Physical characteristics of each SKU;
- Shelf-life limitations;
- Planned stock levels;
- Existing warehousing software and related hierarchy;
- Staffing and space requirements;
Planning and designing the system took a year; installation took
less than six months.
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