Problem description
The company BSH Sprzet Gospodarstwa Domowego Sp. z o.o. is a subsidiary of the German corporate BSH Bosch und Siemens Hausgeräte GmbH and was established in 1993. Generally, Poland plays an important role on the investment map of the global player. There are three factories with logistics centers located in Lodz, a nationwide distribution center in Bukowiec and the head office in Warsaw. The latest investments of the German corporation are: research and development center and information services center in Lodz. BSH has reached a strong position on the Polish market since its establishment.
BSH Sprzet Gospodarstwa Domowego Sp. z o.o. realises the corporate business strategy. BSH uses logistics processes to build its global competitive advantage. The following corporate priorities in logistics management are well defined: high service level, cost optimisation, environmental protection, innovation, cooperation, support for SMEs. Excellent process management is the key success factor of the company.

The operational excellence has been also developed in the Polish factories. One of the best practices was implemented in the clothes dryers’ production plant and its logistics center. It is the BSH’s sole factory of these appliances in Europe. It was located in Poland because of the guarantee of high flexibility regarding production and deliveries systems.

Both systems are suited to the demand seasonality, which is characteristic for the market of these products. The BSH employees have developed best practice to improve transport
and warehousing efficiency in this production plant. At the starting point, the design of the product and its packaging were changed significantly. Next, these initiatives have huge impact on the efficiency of logistics processes.
 
BSH has implemented a unique business practice in the factory for clothes dryers and its logistics center located in Lodz, Poland. The company has designed the product in such a way that it promotes greater warehousing and transport efficiency. Changes were made to the size, weight and packaging of the manufactured appliances.
This practice reflects the impact that decisions taken on the first stage of the value chain have on the effectiveness of final product flows in the downstream stages. Moreover, the implementation of proper initiatives in many areas at the same time benefits the operational excellence of the company.

The solution
Warehousing efficiency
All finished products are transported from the production hall to the warehousing area on the automatic conveyor belts. The goods are automatically sorted according to their shipping direction. The dryers are placed in the same area in 3 rows and each of them consists of 4 appliances. As a result, a  forklift truck operator can transport 12 dryers at the same time.
This optimises utilisation of the working time of the operator  and the material handling equipment. It also accelerates the internal transport of products in the warehousing area. The possibility of moving 12 appliances at the same time required a suitable adaptation of product design, its packaging and the use of appropriate warehousing equipment.

BSH has also developed a solution that permits maximum utilisation of warehousing space. Capacity is used in the optimum way as the appliances are placed in blocks. Each block consists of 8 appliances standing one on the other. In this way, 25% of the warehousing area are saved compared to the typical blocks consisting of 6 appliances. There are two basic factors in the implementation of this solution.
Firstly, the relevant technical strength of appliances was achieved and their weight was well suited (55 kg/item). Secondly, cardboard partitions are used to separate each level of the dryers in the block and ensure the stability of the construction.

As a result, the capacity of the building is completely used with the exception of the small strip between  the last appliance and the lighting lamps. This facilitates the effective work of the fork-lift truck operators. They take up each batch of appliances, lifting it slightly. The planned time for stockkeeping is a maximum 4 days. Business practice indicates that it usually takes between 3 and 3.5 days. With regard to warehousing, BSH relies completely on its own expertise.

Transport efficiency
Changes in the product and its packaging have resulted in their increased technical resistance to transport conditions. The filling rate of transport vehicles has risen significantly. First of all, advantages are noticed with the organisation of road and rail shipments. Transport of finished goods is fully outsourced.
With regard to road shipments, the logistics center cooperates with many carriers. The uniqueness of BSH’s practices is based on the use of a special kind of trailer, so-called “side curtain trailers”. The appliances can be loaded in batches of 24 thanks to the products’ characteristics. There are places in some kinds of trailers where the batch consists of 18 appliances. This loading format means that the capacity of each trailer is fully used (almost 100%).
Moreover, the railway shipments of finished products are organised from the logistics center in Lodz. The scale of “green deliveries” is illustrated by the fact that 24 wagons are shipped to the single German customer every week. There are 264 appliances in each of them. The maximum filling rate of these vehicles ensures the effectiveness of these shipments.
The railway platform inside the warehouse permits the loading of 9 wagons at the same time. The railway shipments are sent to Germany and Scandinavia. In the case of Poland’s western neighbour, the distribution center in Nauen near Berlin is the destination. In the case of Scandinavia, almost all shipments are performed by railway transport. The main reason for this is the preference of Scandinavian buyers for the “green mode of transport”.

Challenges
Challenge 1: Changes in production and logistics systems at the same
time. The appliances and their packaging have technical parameters that promote achievement of high transport and warehousing efficiencies.
Challenge 2: Involvement of personnel. Firstly, the employees had to understand the project aims. Secondly, they put in huge effort to achieve the goals every day.
Challenge 3: Cooperation with road and rail operators. Their reliability determines the quality and punctuality of BSH’s deliveries. The drivers know e.g. how to prepare the side curtain trailers next to the loading platforms.
Challenge 4: Technological requirements. Material handling equipment in the logistics center is suited to the internal transport of appliances.
Challenge 5: Access to the infrastructure. The availability of the required number of transport vehicles is guaranteed. Further critical issues are: quality of the available vehicles, road and rail transport networks and safety of the shipments.

Lessons learned
Best practice implementation is usually driven by the strategy of the company including the elements of sustainable development.
• Success of supply chain projects requires strong awareness of the necessary changes and engagement of human resources. Continuous improvement of the effects is not possible without continuous development of people’s skills and qualifications.
• Logistics best practices are sometimes determined by the initiatives originating from other areas, e.g. product development and production.
• This case proves that the complementary good practices in different, operational areas are the foundation for the long term competitive edge of the company, especially in times of economic crisis.

Success factors
• The business strategy of the company is geared towards the search for solutions based on three integral dimensions: economic, social and environmental.
• Skills and experience of personnel promote continuous
improvement of the effects.
• Successful cooperation with external providers to
ensure required transport vehicles.
• Excellence in process management from the beginning
of value creation in the supply chain.
• Strong determination to increase the effectiveness
and efficiency of logistics processes based on the
realisation that logistics is the source of the competitive
edge.