Chapter 7: How to Read and Interpret PCB Analysis

I. IQ-PCB Analysis (Considerations for Pallet and Case Units)

  • Shipment Composition by Packaging and Operations: If pallet shipments account for 40% and case shipments account for 60% of total volume, a combined operation of both units is required. Monthly analysis is effective for understanding fluctuations in these ratios.
  • Classification by ABC Rank: High-volume items with over 100 cases shipped are categorized as Rank A, while low-volume items with 10 cases or less (roughly half of SKUs) are Rank C.
  • Storage Systems: Rank A items typically use "Floor Stacking," while low-volume Rank C items are managed using pallet racks as a basic guideline.
  • Workload Calculation: Total work hours are calculated based on case picking capacity, serving as the basis for personnel planning.

II. IQ-PCB Analysis (Reinterpreting for Case and Bulk Units)

When Units Change, the Design Changes: If the pallet-case analysis is reinterpreted as "Case-Bulk," the required equipment changes significantly.

  • Shipment Breakdown: A configuration where 40% of the total volume is case shipments and 60% is bulk (piece) shipments.
  • Equipment Selection:
    • Case Flow Racks: Ideal for major items (Rank A and B) where bulk picking occurs frequently.
    • Mezzanine or Static Shelving: Suitable for low-volume, high-variety items (Rank C) with very few shipments.
  • Operational Format: Storage is divided into pallets and cases; case shipments are fulfilled directly from pallets, while bulk shipments utilize dedicated picking shelves.

III. Interpreting EQ-PCB Analysis

  • For Pallet Units: If most orders consist of several pallets or more, Single Picking becomes the core operation, and vehicle dispatching focuses on customer-specific truck deployment.
  • For Case/Bulk Units: If most orders consist of several cases or more, the standard operation involves consolidating bulk-picked items into returnable containers.

IV. System Evolution (Flexible Design)

The most important perspective in logistics system design is the change in the "Magnitude of Numerical Values (Unit of Packaging)".

  • The Unit Barrier: Whether it is Pallet, Case, or Bulk—a difference of just one magnitude (one digit) fundamentally alters the optimal equipment and operational rules.
  • Adapting to Changing Times: As high-variety, small-lot trends continue and order sizes decrease by one digit, productivity in existing systems will drop significantly.
  • Conclusion: It is crucial to analyze EIQ data and build flexible distribution center systems capable of responding to these changes.