As the warehouse design progresses Goals become more detailed and apply to the smaller "building blocks" of the overall design. Constraints get better understood, give rise to Goals. These Goals then become the specs for equipment and processes, all of which go to make the warehouse design successful.

Here is a real life example where the lack of attention to constraints almost derailed a multi million dollar warehouse design project.

An entertainment products distribution company distributed to major retailers, book stores, and some schools. Orders ranged from a single volume to multiple volumes of the same SKU and multiple SKU's. There were over 18,000 titles, (SKU's) in stock and the operation was paper based. 82% of orders had to have the invoice enclosed.

The staff were long term and the warehouse based in a small town which essentially depended on the company for its financial survival. The problems were, that as volume and velocity increased the customer service levels decreased and Delivery In Full On Time, (DIFOT), became the exception rather than the rule.

The Goals were:

Increase the life of the warehouse to ensure the Corporate responsibility to the community

Increase Customer Service to Order received by 2:30 p.m. dispatched by 5:30 p.m.

Increase DIFOT to 99%

The Constraints were:

Available capital was $1 million

The warehouse operation must continue during the implementation

The Go-Live date must be before the end of the 3rd quarter in order to be in place before the end of year peak period giving the company 22 weeks to complete the design, contracting and implementation