FULLTEXT01

Improving Warehouse
Efficiency: An Exploratory
Analysis of Pallet Handling in
a Production Warehouse
A Case Study at a Small and Medium-sized Enterprise
within the Surface Treatment Industry
MAIN AREA: Industrial Engineering and Management

AUTHORS: Kajsa Eriksson and Vendela Nord Nilsson
JÖNKÖPING: 2023
This exam work has been carried out at the School of Engineering in Jönköping in the subject
area of industrial engineering and management. The authors are responsible for the opinions,
conclusions, and results herein presented.
Examiner: Marco Santos
Supervisor: Alice Mohlin
Scope: 15 credits
Date: 2023-05-24
Abstract
Abstract
Purpose – The purpose of this thesis is to explore ways to increase the efficiency of
pallet handling within a production warehouse.
Method – To achieve the purpose of the study, a single case study was conducted at a
small and medium-sized enterprise. To gather qualitative data required for the analysis,
interviews and observations were conducted with employees, giving a holistic view of the
problem. The empirical findings were first categorized into 11 codes that were later
broken down into 8 themes that were combined with the theoretical background for the
analysis. The eight wastes and the 5S program were used from the theoretical background
to structure the analysis chapter and answer the thesis's research questions.
Findings – The findings show that organizations trying to increase efficiency in their
pallet handling could apply the lean method. More specifically, the organization should
eliminate non-value-added activities as these are wasteful and implement the 5S program
to organize its pallet racks. These changes should be implemented slowly, continuously
and include employee engagement.
Implications: – This thesis benefits managers by presenting options for companies

trying to create and maintain a competitive organization regarding production speed,
satisfied stakeholders, and product quality. Further, this thesis contributes knowledge to
fill the identified research gap on applying lean in production warehouses.
Limitations – Prior to conducting the analysis, it was believed that multiple documents
would be received for the planned document analysis. However, this was not the case,
and the document analysis was omitted. Further, a larger interview sample would increase
the validity, and fewer prepared interview questions should be used during interviews.
Lastly, different pallet moving methods could have been included in the analysis, which
would have generated specific recommendations beneficial for managers and researchers.
Keywords – 5S program, eight wastes, lean, non-value-added activities, pallet handling,

pallet movement, pallet racking, production warehouse.
Ⅰ
Acknowledgments
Acknowledgments
We would like to take the opportunity to thank everyone who has supported us
throughout this thesis work. Special gratitude to Proton Finishing AB in Forsheda and
Christoffer Petersson for allowing us to work on this project. We send our gratitude to all
employees at the company who participated in the interviews and took the time to show
us their work at the production warehouse. We also want to thank our supervisor Alice
Mohlin for supporting us during the thesis work. Your feedback has helped us improve
our thesis and encouraged us to strive for a better result.
Ⅱ
Table of content
Table of Content
1 Introduction 1
1.1 Background 1
1.2 Problem Statement 2
1.3 Purpose and Research Questions 3
1.4 Scope and Delimitations 3
1.5 Thesis Outline 4
2 Theoretical Background 5
2.1 Pallet Handling within a Production Warehouse 5
2.1.1 Pallet Movement 5
2.1.2 Pallet Racking 6
2.4 Lean as a Way of Increasing Efficiency 7
2.5 The Eight Wastes of Lean 8
2.5.1 Overproduction 9
2.5.2 Waiting 10
2.5.3 Unnecessary Transport 10
2.5.4 Overprocessing 11
2.5.5 Excess Inventory 11
2.5.6 Unnecessary Movement 12
2.5.7 Defects and Errors 12
2.5.8 Unused Talent 12
2.6 The 5S Program within Lean 13
2.6.1 Sort 13
2.6.2 Straighten 13
2.6.3 Shine 14
2.6.4 Standardize 14
2.6.5 Sustain 14
3 Methods 15
3.1 Design of the Study 15
3.1.1 Case Company: Proton Finishing AB in Forsheda 15
3.2 Approach 16
3.3 Data Collection 17
3.3.1 Interviews 17
3.3.2 Observations 19
3.4 Data Analysis 19
3.5 Data Quality 21
3.5.1 Internal Validity 21
3.5.2 External Validity 21
3.5.3 Reliability 21
3.5.4 Ethical Considerations 22
4 Empirical Findings 23
4.1 Case Company 23
4.1.1 Problem Statement at the Case Company 23
4.2 Interview Findings 23
4.2.1 Ideal Pallet Flow at the Case Company 23
4.2.2 Challenges and Current State of the Production Warehouse 25
4.2.3 Current Pallet Handling within the Production Warehouse 26
4.2.4 The Importance of Having an Organized Production Warehouse 27
Ⅲ
Table of content
4.2.5 Ways of Handling Packaging Material within the Production Warehouse 27

4.2.6 Challenges and Current State of Non-value-added Activities in the Production Warehouse 28
4.2.7 Efficiency within the Production Warehouse 29
4.2.8 Checklists and Guidelines within the Production Warehouse 29
4.2.9 Previous Implementation Efforts of the 5S Program 30
4.3 Observation Findings 31
4.3.1 Recurring Observations 31
4.3.2 First Observation 31
4.3.3 Second Observation 32
4.3.4 Third Observation 32
4.3.5 Fourth Observation 33
5 Analysis 35
5.1 How can Pallet Handling within a Production Warehouse be Improved by Eliminating
Non-Value-Added Activities? 35
5.1.1 Overproduction 35
5.1.2 Waiting 36
5.1.3 Unnecessary Transport 36
5.1.4 Overprocessing 37
5.1.5 Excess Inventory 38
5.1.6 Unnecessary Movement 39
5.1.7 Defects and Errors 40
5.1.8 Unused Talent 40
5.2 How can Pallet Racks be Organized to Improve Efficiency within a Production Warehouse? 40
5.2.1 Sort 41
5.2.2 Straighten 41
5.2.3 Shine 42
5.2.4 Standardize 42
5.2.5 Sustain 43
5.3 Recommendations 44
5.4 Summary 46
6 Discussion 47
6.1 Discussion of Findings 47
6.1.1 How can Pallet Handling within a Production Warehouse be Improved by Eliminating
Non-Value-added Activities? 47
6.1.2 How can Pallet Racks be Organized to Improve Efficiency within a Production Warehouse? 47
6.2 Implications 48
6.2.1 Practical Implications for Managers 48
6.2.2 Theoretical Implications for Researchers 48
6.2.3 Sustainability Perspective 48
6.3 Discussion of Methods 49
7 Conclusion 50
7.1 Conclusion and Recommendations 50
7.2 Future Research 50
8 References 51
9 Appendices 54
Appendix 1: Layout map of the production warehouse at Proton Finishing AB in Forsheda.

Appendix 2: Interview Questions
Ⅳ
List of figures and tables
List of Figures
Figure 1. An outline of the content of the different chapters in the thesis. 4
Figure 2. Steps to implement lean through the five principles of lean. 8
Figure 3.1. A step-by-step overview of the thesis work process. 16
Figure 3.2. The Connection between purpose, research questions, and applied methods. 17
Figure 3.3. An overview of how empirical data and literature were analyzed. 20
Figure 4.1. An overview of what the ideal Pallet flow at the case company would look like. 24
Figure 4.2. Main takeaways from the first observation. 31
Figure 4.3. Main takeaways from the second observation. 32
Figure 4.4. Main takeaways from the third observation. 33
Figure 4.5. Main takeaways from the fourth observation. 34
List of Tables
Table 3.1. An overview of the interviews conducted for data collection. 18
Table 3.2. An overview of the observations performed for data collection. 19
Table 5. Identified shortcomings, causes, and suggested recommendations. 45
Ⅴ
Abbreviations and Acronyms
List of Abbreviations and Acronyms

AGV - Automatic Guided Vehicles
WIP- Work in Progress
WMS - Warehouse Management System
Ⅵ
Introduction
1 Introduction
This chapter introduces production warehouses, lean thinking, and pallet handling in terms of their
importance for an efficient supply chain. Also, this chapter presents the purpose of the thesis, along with
the research questions, scope, and delimitations that all relate to pallet handling and a lean mindset.
1.1 Background
With the forever increasing customer demand for product quality, lower costs, and
shorter lead time, the importance of a well-functioning and efficient supply chain has
grown (Beamon, 1998; Bowersox et al., 2013; Myerson, 2012). The role of supply chains
and, more specifically, supply chain management has been crucial in developing
corporate efficiency (Janvier-James, 2011).
Supply chains were defined by Beamon (1998) as “An integrated process wherein a number of
various business entities [...] work together in an effort to: (1) acquire raw materials, (2) convert these
raw materials into specified final products, and (3) deliver these final products to retailers” (Beamon,
1998, p. 281). In the process of converting raw materials into finished goods, a need to
temporarily store unfinished, partially finished, and finished products will exist, which is
why production warehouses are used (Martin, 2018). The purpose of a production
warehouse is to “Buffer[s] the interim products in line with the manufacturing and assembly stages”
(Martin, 2018, p. 403), thus providing the possibility of momentarily storing products. A
production warehouse can be considered one joint entity, despite fulfilling both the
function of a warehouse and a production facility (Martin, 2018).
Bowersox et al. (2013) state that pallet handling is crucial in a modern warehouse to
ensure an efficient product flow. Improving the pallet flow will minimize pallet
movements, which is highly beneficial as movements are considered a non-value-added
activity that should be eliminated (Bowersox et al., 2013). In markets with multiple
competitors and constant pressure from customers to continuously improve, an overall
reduced lead time by developing pallet handling can provide a crucial competitive
advantage, ultimately pivotal for the company's survival (Bartholdi & Hackman, 2019).
Further introducing a sustainability perspective to the overall business by including the
three pillars of economic, social, and environmental sustainability ensures that the
company remains attractive from the customer perspective Bajec et al., (2020).
According to Gupta (n.d.), the importance of pallets and palletization of items have
played an essential role throughout the history of the world, thus highlighting their
importance. A way of solving logistical difficulties and challenges within the organization,
and thereby improving pallet handling, is by applying a lean mindset and transparent
communication with supply chain stakeholders (Myerson, 2012). The lean philosophy
aims to minimize all resources required for operations within a company by eliminating
1
Introduction
activities that do not bring value to the end customer and thereby make the processes
more efficient (Bowersox et al., 2013).
When implementing a lean mindset, all non-value-added activities should be eliminated,

including unnecessary transportation (Liker, 2004). However, according to Martin (2018),
the movements occurring between the production line and the warehouse section are
required for the overall process to function. Along with this contradiction concerning
movements and pallet handling, a gap has, during this thesis conduction, been found in
the research within the field of production warehouse management, as few studies have
been performed on making pallet handling in a production warehouse more efficient.
1.2 Problem Statement

As mentioned in the background, pallet handling is crucial in a modern warehouse to
ensure an efficient product flow (Bowersox et al., 2013). Further, implementing lean
within a warehouse will help to increase the efficiency of the business processes and to
ensure that value is brought to the customers (Bowersox et al., 2013). This can be done
by mapping the value stream to identify the non-value-added activities within the process
and eventually eliminate them (Lean Enterprise Institute, n.d.a). Zagzoog et al. (2019)
suggest that non-value-added activities result from an unorganized workplace and that
these negatively impact the organization’s overall financial performance.
If eliminating non-value-added activities is not considered, there is a risk for longer lead
times, increased product damage due to movements, unnecessary processes, and a push
mindset. All these factors increase costs and the risk of unsatisfied customers (Soliman,
2017). If an organization lacks an operational material flow, unnecessary transportation
will occur as the pallets are temporarily parked between processes (Liker, 2004). This will
result in delays to customers and additional costs added to the products, including
increased costs of: operators moving the pallets, resources, and equipment (Soliman,
2017).
Lean is a method applicable in both production and warehousing and is used to increase
production speed while keeping the current price and quality of the products by
eliminating non-value-added activities (Myerson, 2012). According to the theoretical
background that is presented in this thesis, many researchers are studying the
implementation of lean within production and warehouseing separately however, there is
a lack of research combining these topics in a production warehouse setting. This could
be a problem as production warehouses are a part of the supply chain, and the entire
organization should be considered when implementing lean (Myerson, 2012). This thesis
aims to contribute to the field by providing knowledge on how a production warehouse
can increase its efficiency within pallet handling by implementing previously known
theories.
2
Introduction
1.3 Purpose and Research Questions

The problem statement highlights the challenges of pallet handling within a production
warehouse. Based on the knowledge gap within the production warehouse management
field, this thesis has the purpose to:
Explore ways to increase the efficiency of pallet handling within a production warehouse.
Two research questions have been formulated to help fulfill the purpose of the thesis.
The first question is essential, as according to Bowersox et al. (2013) when an
organization's pallet handling is not functioning correctly, it may result in activities that
do not create value for customers. These non-value-added activities should be eliminated
to create and maintain a competitive organization with satisfied stakeholders (Bowersox
et al., 2013).
1. How can pallet handling within a production warehouse be improved by eliminating
non-value-added activities?
Zagzoog et al. (2019) state that maintaining an organized production warehouse is
essential as it minimizes inefficiency in most activities. This means that having structured
and standardized pallet racks allows for a more organized work environment and
increases efficiency within all aspects of the work (Zagzoog et al., 2019). The need for a
structured workplace has led to formulation of the second research question.
2. How can pallet racks be organized to improve efficiency within a production warehouse?
1.4 Scope and Delimitations

This thesis focuses on identifying ways to increase the efficiency of pallet handling within
a warehouse in conjunction with a production known as a production warehouse and will
not consider the effects on other departments, such as sales and marketing. The thesis
will only focus on how pallets are handled internally and exclude the external material
flow. The topic will be investigated from the perspective of floor workers, office
personnel, and management to ensure a holistic view of the problem. A case study will be
conducted at a small and medium-sized enterprise and not at a large enterprise, as this
could provide a unique opportunity to access specific practice insights.
3
Introduction
1.5 Thesis Outline

The thesis comprises seven chapters, and its content is outlined in Figure 1 below. In
addition, the chapters are divided into subchapters to clarify the structure of the content
further.
Figure 1: An outline of the content of the different chapters in the thesis.
4
Theoretical background
2 Theoretical Background
This chapter aims to familiarize the reader with pallet handling, pallet movement, and pallet racking to
provide a background on the problem statement and the information will later be used in the analysis.
Further, the overall method of lean, and more specifically, the eight wastes and the 5S program, are
presented as the theoretical framework.
2.1 Pallet Handling within a Production Warehouse

Today’s manufacturing companies are becoming more reliant on acquiring material from
global suppliers, and globalization has facilitated this (World Trade Organization, 2017).
With the continuously increasing international trade, the usage of pallets has also
increased (Gupta, n.d.). Partly this is due to the usage benefits, which include: faster
loading and unloading of products, decreased labor requirements, minimized product
damage, minimized employee risk, and since it provides standardized measurements of
the object desired to be transported (Gupta, n.d.).
Along with the globalization of the world and, thereby, the advancement of technology,
the solutions to monitor, record, and track pallet handling has been improved
(Gnimpieba et al., 2015). These processes, which used to be completed manually when
the pallet was idle, can now be performed automatically while the pallet moves as
technology is used significantly (Gnimpieba et al., 2015). Due to the increased movement
of products and pallets, well-functioning pallet handling is essential to ensure these tasks
are correctly executed. One way to facilitate the handling of pallets is by ensuring
transparent communication and transparent operations throughout the supply chain, as
this minimizes errors and facilitates the flow of information (Myerson, 2012). According
to Martin (2018), ‘handling’ within a warehouse are movements that change the spatial
arrangements of cargo over short distances and may include factors such as quantity,
time, and direction. Actions involve lifting, lowering, moving, palletizing, and racking
cargo, all required for efficient handling (Martin, 2018). Based on this, this thesis work
will use the combining term ‘pallet handling’ as an umbrella term covering pallet
movements and pallet racking. This term thus describes the overall flow of pallets within
a production warehouse and, therefore, describes all operating actions concerning pallets
throughout the internal flow.
2.1.1 Pallet Movement

Within a production warehouse, many different types of movements occur. Movement of
people, equipment, and pallets are all factors that should be reduced and preferably
eliminated to ensure a work environment without accidents, as movements bring an
added risk for collisions, employee injury, and equipment harm (Abideen & Mohamad,
2020). While Abideen & Mohammad (2020) and Liker (2004) believe that all movements
should be reduced and preferably eliminated, Martin (2018) and Myerson (2012) state
that pallet movements are necessary despite being non-value-added as the general
5
production needs to be supplied with material and products. This thesis will refer to
pallet movement as any time when a pallet is not standing idle.
Throughout a production line, it is common to dismiss the times a pallet is waiting to be

moved, the actual moving time, and the resources taken to perform the move as parts of
the normal business process (Myerson, 2012). This mindset can, however, create
problems as it is common for these areas to be overlooked, despite having great potential
for reducing the overall operating expenses (Bartholdi & Hackman, 2019). Depending on
factors such as the size and layout of a production warehouse, along with personnel
capabilities, there are multiple ways in which a pallet can be transported. It should be
considered if there is a desire for manual, semi-automated, or automated transportation
methods, along with additional factors such as financial capabilities and time frame
perspective (Martin, 2018).
Pallet trucks are one example of a manual pallet-moving method, and they require
minimal experience to be maneuvered and are practical to use in small spaces and narrow
aisles. They are driven by manpower and are an inexpensive way of moving pallets along
the floor level (Martin, 2018). However, moving heavy pallets becomes difficult as this
method relies on human forces, thus limiting the times it can be used (Martin, 2018).
Instead, a semi-automated pallet moving method such as forklifts can be used. A
particular driver's license is mandatory to drive a forklift according to laws in Europe,
and it takes time to train the workers to operate it (Toyota-forklifts, n.d.). Further,
another disadvantage is that forklifts have a high initial cost and a relatively high running
cost due to requiring fuel, for example, electricity. However, they can carry much heavier
loads than a pallet truck at a faster pace and can lift the pallets above ground level to be
placed in, for example, a pallet rack (Martin, 2018).
Automatic pallet moving methods are relatively new compared to the other options.
However, with the continued development of technology, Automated Guided Vehicles
(AGVs) are gaining traction due to the minimized risks associated with them (Martin,
2018). AGVs use sensors and 3D cameras to travel within the predetermined routes. By
canceling out the human factor, pallets can be moved freely along the aisle with minimal
risk of accidents due to anti-collision sensors (Moshayedi et al., 2019). However,
implementing this method requires a significant upfront payment, and it can take years
until the method is functioning smoothly, resulting in high costs regarding both money
and time (Martinez-Barbera & Herrero-Perez, 2010). Further, for AGVs to work within a
warehouse, the layout and structure must first be adapted to accommodate the paths of
AGVs (Martinez-Barbera & Herrero-Perez, 2010).
2.1.2 Pallet Racking

Within most warehouses, there is a need to store pallets containing material for
production and finished products for the customers. To avoid disorganization on the
production floor, pallet racks are an appropriate way of storing the pallets until they are
6
needed by the production or until they are shipped to customers (iGPS, 2020). In this
thesis, pallet racking will be used to describe the process of putting pallets in racks for
storage and the idle state of the pallet when it is already racked. Pallet racks facilitate the
storage of pallets in a warehouse and make it possible to store inventory vertically, which
utilizes the full extent of the building (Bartholdi & Hackman, 2019). Depending on the
size and shape of the rack, the carrying capacity varies, and it is crucial to know the
weight limit to avoid overfilling them (Daudelin, 2022). According to Bartholdi &
Hackman (2019), if pallet racks are not used, pallets containing the same product can be
stacked on each other without creating accessibility difficulties. However, this should be
avoided if the pallets contain different products, as it increases the risk of losing a
product and creating unnecessary work (Bartholdi & Hackman, 2019).
Pallet racks can eliminate unorganized work environments, as these can lead to multiple
issues, such as a lack of efficiency, damaged or lost inventory, and customer
dissatisfaction (Myerson, 2012). One way to ensure that the pallet racks within a
warehouse remain organized is by introducing a Warehouse Management System (WMS)
(Ramaa et al., 2012). Implementing a WMS can reduce unnecessary activities when
handling pallets; it will increase overall productivity and simultaneously reduce operating
costs, which are highly beneficial for the organization (Poon et al., 2009).
2.4 Lean as a Way of Increasing Efficiency

The lean method is applicable not only in manufacturing but also in warehouses and,
more specifically, pallet handling (Myerson, 2012). Implementing lean within a warehouse
will help to increase the efficiency of the business processes and to ensure that value is
brought to the customers (Bowersox et al., 2013). Toyota developed the lean method to
increase production speed while retaining the overall quality and price of the product,
and it is today known as the Toyota Production System (Liker, 2004; Mohan Sharma &
Lata, 2018). Lean is a method that involves value creation and simultaneously reduces the
resources and the non-value-added actions. The aim is to continuously improve and
eliminate all organizational waste (Lean Enterprise Institute, n.d.c). Myerson (2012, p.62)
defines value-added activities as any “Activity that transforms material or information that the
customer is willing to pay for”. On the other hand, non-value-added activities are “Activities
that create no value in the eye of the customer” (Myerson, 2012, p.62).
According to Lean Enterprise Institute (n.d.b), there are five principles: identify value, map
the value stream, create flow, establish pull, and seek perfection. Figure 2.1 depicts the principles,
summarised below the figure (Lean Enterprise Institute, n.d.b).
7
Figure 2: Steps to implement lean through the five principles of lean.
Note. The five principles of lean. Adapted from “Lean Enterprise Institute, Inc,” by Lean
Enterprise Institute, Inc, n.d.b., Retrieved February 27, 2023, from
https://www.lean.org/lexicon-terms/lean-thinking-and-practice/. Copyright 2000-2023 by Lean
Enterprise Institute, Inc. Adapted with permission.
1. Identify Value: Identify what end customers deem valuable in the final product
and strive to deliver this.
2. Map the Value Stream: In the value stream, distinguish between value-adding
and non-value-added steps and eliminate those that do not bring value to the
customers.
3. Create Flow: Ensure that all value steps frequently occur to let products flow
smoothly through the process to the customers.
4. Establish Pull1: Ensure that customer demand is the driving force that pulls the
value from the upstream activities.
5. Seek perfection: Continuously improve all steps until the perfect result is
achieved without waste.
When implementing lean, it is essential to use tools and methods such as value stream
maps, the mindset of continuous improvement, reduction of defects and errors through
problem-solving, implementation of a kanban system to establish pull, and the
elimination of non-value-added activities can be performed (Myerson, 2012). Applying
lean tools within a warehouse ensures a cost and time-effective environment (Tahboub &
Salhieh, 2019). Moreover, Myerson (2012) states that warehouses are a suitable place to
begin the implementation process as they often are wrongfully thought of as
well-structured and organized when this is not always true.
2.5 The Eight Wastes of Lean

When implementing lean, the first thing to do is to implement the first lean principle,
identify value, by considering what internal and external customers want from the process.
This is done by observing the process from the customer’s point of view (Liker, 2004).
The next step is to apply the second lean principle, map the value stream, which is done by
identifying the value-added activities and removing the non-value-added ones (Liker,
2004). Within the subject of lean, non-value-added activities are also referred to as
1
Pull is the perfect state of Just-in-Time which means producing what the customer
wants in the right amount at the right time (Liker, 2004).
8
wastes, or muda, as it is called in Japanese (Liker, 2004). Eliminating waste is one of many
lean tools. Toyota has identified seven essential non-value-added activities to reduce in a
business or manufacturing process as they are classified as wastes. The seven wastes are
overproduction, waiting, unnecessary transport, overprocessing, excess inventory,
unnecessary movement, and defects and errors (Liker, 2004). Commonly, an eighth waste
is also added, the unused talent of employee creativity, which can be fatal if not
considered. These wastes exist not only in a production line but in all processes,
including administration offices, sales departments, and marketing (Myerson, 2012).
For the management to fully understand the customer's values and eliminate the eight
wastes, they must ‘go and see’ the process themselves, known as Genchi Genbutsu within
lean (Liker, 2004). According to Liker (2004), the purpose of Genchi Genbutsu is to truly
understand the work procedure to detect any problems that prevent the organization
from succeeding and is the first step in any problem-solving process. Further, multiple
observations are performed, and these are used for improving and evaluating a work
situation. The observations are performed on different levels of the organization, from
floor workers to team leaders, to gain a holistic point of view. These aspects may include
the flow of material and information, just-in-time, quality control, and eliminating the
eight wastes (Liker, 2004).
2.5.1 Overproduction
Overproduction is the act of processing, producing, or ordering before it is needed,
which can result in excess inventory, overstaffing, and extra costs due to needing extra
storage and additional transportation (Liker, 2004; Myerson, 2012). Myerson (2012)
claims that overproduction can generate longer lead times than necessary and an
increased amount of defects which may be more challenging to discover due to the
increased amount of processed products. Further, Myerson (2012) claims that
overproduction often causes a Just-in-Case mindset rather than the lean mindset of
Just-in-Time. According to Jiang et al. (2022), the biggest weakness of Just-In-Time is its
vulnerability to unpredictable factors. This results in companies exploring Just-In-Case,
which allows them to hold more extensive inventories, thus preparing for unforeseen
events. Excess inventory is another waste described below that should be eliminated.
As the waste of overproduction can occur in many different ways, warehouses can be
affected as some orders are pulled earlier than necessary (Myerson, 2012). Bozer &
Britten (2012) claims that warehouse overproduction occurs when an order is picked too
early compared to its due date. This results in an increased work in progress (WIP) in the
picking and packing areas where the order will take up space before being shipped.
One way to prevent overproduction in a warehouse while decreasing the overall

inventory level is to implement the fourth lean principle, establish pull (Bozer & Britten,
2012). According to Liker (2004), one-piece flow is one way of achieving a pull system, as
one batch is made out of one customer order, producing what is demanded rather than
9
pushing out products whether the customer requests them or not. Further, Kanban is
another suitable tool for implementing a pull system since it sends a signal to the
previous step when a new batch is needed, thus minimizing excess inventory.
2.5.2 Waiting
This waste regards the time spent waiting for supplies, materials, information, or
employees to finish a task (Myerson, 2012). It also includes the waiting time for tools,
machines, and the next step in the process. In other words, the time when employees
have no work to do due to delays, stockouts, capacity bottlenecks, and equipment or
machine downtime (Liker, 2004; Tahboub & Salhieh, 2019). In addition, waiting is often
generated by the following operation due to long setup times and large batch sizes
(Myerson, 2012). The waste of waiting is reduced by applying the third principle of lean,
create flow, as mentioned previously in Figure 2.1, since delays are eliminated when flow is
created (Tahboub & Salhieh, 2019). Myerson (2012) claims that it is common for
products to wait in the warehouse between the process steps, for example, during
inbound and outbound logistics, racking, and packing.
2.5.3 Unnecessary Transport

This waste includes unnecessary transport of materials, moving WIP inventory for long
distances, and redundant movements between processes (Liker, 2004). The movements
involve racking and temporary parking orders and may concern the movement of
information, equipment, people, and supplies (Myerson, 2012). According to Tahboub &
Salhieh (2019), unnecessary transport within warehousing also includes empty forklifts
moving through the warehouse and truck terminals far from where the inventory is
stored.
Myerson (2012) claims that only moving the inbound material once when putting it away
and a second time for processing is ideal; however, this rarely occurs. Products are often
moved multiple times before ending in their rightful position, resulting in unnecessary
transport that brings additional costs from having extra personnel and the added risk of
product injury during transportation. Further, with increased product movement comes
the risk of misplacing the products, which creates unnecessary labor and costs (Myerson,
2012).
Unnecessary transportation is often a result of a poor facility layout, including extended

distances between the different process steps and between the warehouse and production
(Soliman, 2017). One way of reducing this waste is by creating a stable flow between the
production and the warehouse. By improving the overall layout of the facility, a one-piece
flow is automatically created as the process of moving products becomes more natural,
thus reducing the steps taken to move one product (Myerson, 2012). Further, when
reorganizing the layout, the main idea is to locate fast-moving products close to the
production, on ground level, compared to slow-moving products that should be placed
10
further away, above ground. A good layout should reduce unnecessary transportation,
contribute to flexibility, and increase the utilization of the facilities, employees, and
equipment (Myerson, 2012).
2.5.4 Overprocessing
The waste of overprocessing is the act of including unnecessary steps in the process or
processing the parts incorrectly. Inadequate tools and the design of products may result
in inefficient processing, which generates nonessential motion and defective products
(Liker, 2004). In addition, overprocessing results from too much time and effort spent
processing material or information that the customer does not consider value-added. It
also occurs when advanced equipment is used for basic processes (Myerson, 2012).
Overprocessing provides waste when producing products of higher quality than the
customer demands (Liker, 2004), which can occur when the customers’ requirements are
unspecified (Myerson, 2012).
Overprocessing within a warehouse includes unnecessary or additional quality checks,

using a manual pallet moving method, using unnecessary packaging, scanning barcodes
multiple times, and reentering data (Tahboub & Salhieh, 2019). To reduce the waste of
overprocessing, Soliman (2017) recommends studying the steps of a process to identify
those that are redundant and eliminate these.
2.5.5 Excess Inventory

The waste of excess inventory includes storage of raw materials, WIP inventory, and
finished products (Liker, 2004). Extra inventory results in delays, longer lead time,
damaged and obsolete goods, and increased storage and transportation costs. There is a
high risk that the excess inventory overshadows other problems such as defects, long
setup times, equipment breakdowns, imbalanced production, and delayed deliveries from
suppliers (Liker, 2004). The inventory not only takes up space that can be used for other
products that customers request, but it also causes additional work when moving,
counting, and monitoring the inventory (Tahboub & Salhieh, 2019). Soliman (2017)
claims that all productions aim to buy materials and rapidly earn money by selling
finished goods, so having capital tied up in excess inventory should be avoided.
In warehousing, additional inventory is created when products are finished before the
customer wants them (Tahboub & Salhieh, 2019). This includes activities like picking and
packaging orders before needed. This waste elimination minimizes the storage needed in
a warehouse and increases productivity since employees do not have to move other
pallets to get to the pallet needed. The waste can be eliminated using a pull system where
processing depends on customer demand (Tahboub & Salhieh, 2019). According to Liker
(2004), Kanban and one-piece flow are two tools that could be used in a warehouse to
achieve a pull system.
11
2.5.6 Unnecessary Movement

This waste includes all movement that customers consider non-value-added to the
finished product (Myerson, 2012), for example, stacking, walking, searching, or reaching
for essential equipment and tools (Liker, 2004). In a production warehouse, this
equipment includes forklifts and barcode scanners. Non-essential motion within a
warehouse also appears when inventory is placed too high or low, forcing employees to
reach or bend when picking the orders. Inefficient routing is one reason this waste may
occur when storing items and can result in handling the same product twice (Tahboub &
Salhieh, 2019).
When reducing the waste of unnecessary movement, the goal is to create a work area
where the operators never have to leave their workstations (Soliman, 2017). The main
idea is to keep the most commonly used items close to where it is applied and at waist
level. Items that are not frequently used should be placed higher up or further away
(Myerson, 2012). Liker (2004) states that the 5S program, which will be further explained
later in this chapter, is an appropriate tool when reducing unnecessary movement when
employees search for equipment. Further, the particular reason for this is that the
program provides clear guidelines for where all the equipment, tools, and material should
be stored to ensure easy access.
2.5.7 Defects and Errors

Defects involve processing defective goods by reworking, repairing, or scraping products
(Liker, 2004), and it gets more costly for the organization the further along in the process
a defect gets (Myerson, 2012). The worst scenario is if customers discover a defect, which
may result in safety issues and a lack of trust. Damage to a product can happen during
activities such as inbound and outbound logistics and picking. Factors such as high
inventory levels, broad variation, poor layout, destructive processes, and insufficient
employee training can cause defects (Myerson, 2012).
Standardizing and visualizing the workplace by providing clear guidelines, checklists, and
sufficient training will help to reduce defective products (Myerson, 2012). In addition,
defects can be reduced by applying the fifth lean principle, seek for perfection, as the
organization must supply the customer with demanded goods, in the correct quantity, at
the right time, and at an acceptable price (Tahboub & Salhieh, 2019).
2.5.8 Unused Talent

According to Liker (2004), ignoring information from employees regarding experiences
at their workstations is considered a waste as they gather first-hand information from
working there and have insightful knowledge that can contribute to improving the
company. Further, engaging and listening to employees will provide new ideas and
improvements to the process (Liker, 2004). Soliman (2017) states that hiring external
staff and not utilizing the current employees' skills and knowledge when improving the
12
organization is considered a waste, along with highly qualified employees performing

basic work tasks.
2.6 The 5S Program within Lean

Myerson (2012) claims that the 5S program is a natural first step when implementing lean
as it is essential for the foundation. The 5S program generates efficiency and
responsiveness for organizations and is a suitable tool to implement when eliminating the
eight wastes within a warehouse (Mohan Sharma & Lata, 2018; Zagzoog et al., 2019).
It is essential to be able to supply customers with products and services of high quality to
compete in the market. Intending to do that, the organization must create products and
services that continuously improve, which can be done by applying the 5S program (Wani
& Shinde, 2021). This program originates from Japan and consists of activities that
reduce defects and injuries within the orgnization and eliminate waste. The five S stands
for seiri, seiton, sesio, seiketsu, and shitsuke, which translates to sort, straighten, shine,
standardize, and sustain (Chiarini, 2013; Liker, 2004; Mohan Sharma & Lata, 2018). In
addition, the 5S program itself originates from the Japanese word ‘Kaizen,’ which means
‘change for better’ (Chiarini, 2013; Wani & Shinde, 2021).
Myerson (2012) claims that the purpose of the 5S program is to organize a firm by
providing structure, a good layout, and visual controls. A company implementing 5S will
increase productivity and become safer, increase efficiency, reduce time spent searching
for items, reduce accidents, and create a foundation for improving the organization
(Myerson, 2012).
2.6.1 Sort
The first thing in the 5S program is to sort out activities performed in the organization
by eliminating all non-value-added activities and only keeping the required ones at the
workstation (Chiarini, 2013; Wani & Shinde, 2021). Infrequently used tools, equipment,
and redundant inventory should be removed (Myerson, 2012). One way of removing
redundant equipment is by using the red tag strategy, which is done by tagging
unnecessary items with a red tag. These items should then be moved to a nearby area,
where they stay until repositioned within or outside the organization (Myerson, 2012).
2.6.2 Straighten
Straighten or set in order is the act of creating a specific place for everything and
ensuring that everything is in its correct place (Liker, 2004; Mohan Sharma & Lata, 2018).
The first thing to do is determine a place for all items used at a workstation. The specific
place should be labeled so it is easy to search for and relocate them (Filip &
Marascu-Klein, 2015; Wani & Shinde, 2021). Considering the material and information
flow at this stage is beneficial to create a good workplace layout, and it can quickly be
13
done by coloring and labeling areas where all tools and equipment belong (Myerson,
2012).
2.6.3 Shine
Shine is where cleaning and inspections occur to prevent machine failures and defects
(Liker, 2004). The goal is to constantly have a clean workstation and always clean the
equipment after each use (Chiarini, 2013; Wani & Shinde, 2021). The purpose of cleaning
the equipment is to ensure that it is ready for subsequent use and to keep it in excellent
condition. If this step is not completed, there is a high risk of increased defective
products, poor work morale among employees, and safety issues (Myerson, 2012).
A form of inspection of the workstation is done during the third S since all equipment is
examined when being cleaned (Filip & Marascu-Klein, 2015). Hopefully, defects and
failures will be detected, and machines, tools, and equipment maintenance can be
performed (Myerson, 2012).
2.6.4 Standardize
Standardizing involves establishing guidelines to improve procedures and maintain the
first three S’s (Chiarini, 2013; Liker, 2004). This phase includes three steps: create a
standard method of executing the work tasks, perform the work only in that specific
method, and continue executing the work disciplined (Wani & Shinde, 2021).
Standardization aims to achieve consistency by providing documented guidelines to
ensure all employees perform the task similarly (Myerson, 2012).
2.6.5 Sustain
Sustaining a standardized workstation is a constant continuous improvement process
(Filip & Marascu-Klein, 2015; Liker, 2004). This stage aims to create a habit of sustaining
the standardized method for a long time. The 5S program should be completed daily, and
all employees are responsible for completing all activities within the program (Myerson,
2012). Wani and Shinde (2021) claim that all activities related to the 5S program should
be performed continuously, and it is vital to motivate all participants to achieve
consistency in all activities.
14
Methods and implementation
3 Methods
This section aims to describe the thesis’ design, the work process and approach, what methods were used
for data collection, how the data analysis was performed, and to provide an overview of the data quality.
3.1 Design of the Study

A qualitative study was performed to fulfill the purpose of this thesis. An example of a
qualitative research methodology is a case study, which aims to develop a comprehensive
understanding of a simple social phenomenon while at the same time providing general
theoretical statements about the holistic area observed (Yin, 2018). A case study uses a
collection of multiple different methods to provide a holistic view of a scenario, and this
methodology is applicable in most scenarios where one area is observed to get more
knowledge about it (Thomas, 2017). Within case studies, qualitative data can be gathered
through interviews and observations conducted in naturalistic settings (Thomas, 2017).
This study aims to explore ways to increase the efficiency of pallet handling within a
production warehouse at a company in its regular work environment; therefore, a
qualitative research approach was found appropriate.
For this thesis, a single case study was chosen as a research gap was found within pallet
handling in a production warehouse. While a case study was performed at only one
company, the findings apply to organizations with production warehouses similar to the
case company’s, thus deeming a single case study sufficient for the purpose of the thesis.
3.1.1 Case Company: Proton Finishing AB in Forsheda

The case study was conducted at Proton Finishing AB in Forsheda, specifically at the
production site in Forsheda, Sweden. The company branch, founded in 1990, offers
surface treatment solutions and is one of Europe’s most prominent suppliers (Proton
Finishing, n.d.a). Through quick reactions and early development, the company’s six
production sites have remained influential and market-leading while continuously
developing the supplied services to meet ever-changing environmental regulations
(Proton Finishing, n.d.a). All sites that offer surface treatment solutions except for one
are located in Småland, a southern region in Sweden, and the last site is in Eskilstuna,
Sweden (Proton Finishing, n.d.b).
Proton Finishing AB has a yearly turnover of approximately 306 million SEK and almost
200 employees (C. Peterson, personal communication, April 24, 2023), which categorizes
them as a small and medium-sized enterprise, a category that 99% of all businesses in the
European Union fall into (European Commission, n.d.). Proton Finishing AB in
Forsheda has 35 employees, and the production is kept open for 24 hours, six days a
week. Customers range from small companies with only a few products to global
15
production companies that require thousands of products to be treated weekly (C.

Peterson, personal communication, March 29, 2023).
3.2 Approach
The thesis work was conducted from January 2023 until June 2023, but the decision to
conduct the thesis at Proton Finishing AB in Forsheda was taken in November 2022. In
collaboration with the case company, a problem description was identified, which
contributed to formulating the purpose and the research questions. Due to the limited
previous knowledge of the pallet handling processes within the company, a lot of data
had to be collected through interviews and observations to ensure a holistic view of the
problem. The large amount of data gathered to conduct the analysis of the pallet
handling in the production warehouse makes it exploratory, according to Davidson &
Patel (2019).
Figure 3.1 depicts the overall approach to the thesis, including the overall work process
of identifying theories, gathering data, and analyzing these by combining the information.
Further, conducting interviews with employees on the management level, office level,
and floor workers provides information from all perspectives. This is essential to receive
an accurate first hand-perspective from all involved employees, which ensures that the
root problem can be identified and appropriate solutions presented (Rowley, 2012).
Figure 3.1: A step-by-step overview of the thesis work process.
As a single case study was conducted, both research questions of the thesis: ‘How can
pallet handling within a production warehouse be improved by eliminating non-value-added activities?’
and ‘How can pallet racks be organized to improve efficiency within a production warehouse?’ were
answered by collecting primary data, as seen in Figure 3.2. To collect the primary data,
interviews and observations were conducted as part of the case study. Applying two
methods triangulates the findings and increases the study's validity (Yin, 2018).
16
Figure 3.2: The connection between purpose, research questions, and applied methods.
3.3 Data Collection

When conducting a case study, one opportunity is using multiple methods for data
collection to triangulate the findings, thus increasing the overall quality of the study (Yin,
2018). For this thesis, interviews and observations were conducted to gather firsthand
data about non-value-added activities, the eight wastes, and the 5S program in the
operations. Further, during both the interviews and the observations, solutions to
eliminate these wastes were discussed and considered by applying the 5S program.
3.3.1 Interviews
Yin (2018) states that interviews are one of the most important methods for gathering
qualitative data for a case study. Conducting interviews is an efficient way to get relevant
information from a respondent, and there are three basic types: unstructured interviews,
semi-structured interviews, and structured interviews (Thomas, 2017). Unstructured
interviews are beneficial when the desire is to learn more about a topic the respondents
have information about through a conversation. Structured interviews consist of a
predetermined set of questions to ask the respondent, and no deviation from this list is
made. Semi-structured interviews combine the other two; there are some guiding
predetermined topics and maybe some preformulated questions on these, but there is a
high possibility of probing the interviewee to extend their answers if necessary (Thomas,
2017). Due to the purpose of this study, semi-structured interviews have been conducted,
as this allowed for a relatively free conversation with the possibility of asking follow-up
questions to further develop the information received. Also, since semi-structured
interviews provide the opportunity to extract information on topics that come up during
the interview while ensuring that the previously formulated questions are answered, this
method was deemed suitable for this thesis.
At the first on-site meeting with the Purchase & Logistics Developer, a semi-structured
interview was held to better understand the problem description, the case company, and
17
the desired outcome. This interview was conducted by two interviewers that
simultaneously took notes. The other interviews were also semi-structured with
open-ended questions with four employees, all with different roles within the case
company. The interviews lasted between 28 and 70 minutes, and most occurred in
person. This allowed the analysis of the interviewees' body language, intonation, and
facial expressions, essential factors when conducting interviews (Opdenakker, 2006). The
aim was to conduct all interviews in person, but due to scheduling conflicts, this was not
possible, and one interview was conducted online but with video. For all interviews,
questions were prepared beforehand within seven topics. The amount of follow-up
questions varied depending on how detailed the answers provided by the interviewee
were. At each interview, two interviewers were present; one focused on asking questions,
while the other focused on taking notes of essential information within the answers. All
interviews were recorded; the questions can be found in Appendix 2. A member check
was conducted throughout each interview, where the interviewee and the interviewers
reviewed the answers to ensure they had been interpreted correctly.
The sample of employees interviewed was an informative decision based on their

different employment levels, as this ensures a holistic view of all company levels affected
by the problem (Rowley, 2012). All interviewees have the essential knowledge about their
area that was key to determining the root problem and then identifying possible
solutions. The interviewees received access to the main topics of the interview before the
conduction but did not receive the questions. The reasoning behind this is to ensure
honest answers without pressure from external factors such as management and
colleagues or by looking up an answer before the interview that might not be entirely
truthful (Thomas, 2017). The interviewees were accessible through email after the
interviews if follow-up questions arose. Table 3.1 below provides an overview of the
interviews, with information such as date, duration, role within the case company, and
form of communication.
Table 3.1: An overview of the interviews conducted for data collection.

Respondent Date Role within the case Method Form of communication Duration
Number company (min)
1 20/1-2023 Purchase & Logistics Semi-structured Physical meeting in the 70

Developer interview company conference room
2 29/3-2023 Site Manager Semi-structured Physical meeting in the 62

interview company conference room
3 29/3-2023 Warehouse Worker Semi-structured Physical meeting in the 61

4 29/3-2023 Logistics Manager Semi-structured Physical meeting in the 60

5 31/3-2023 Production Manager Semi-structured Online meeting 28

interview
18
3.3.2 Observations
Observing how a company works makes it possible to detect deviations from what
employees believe they do to what is being done (Thomas, 2017). Every workplace has
opportunities to conduct observations where appropriate environmental and social
conditions are investigated (Yin, 2018). Therefore, conducting observations is a valuable
tool for gathering firsthand data about a situation, and this was used to investigate the
current pallet handling at Proton Finishing AB in Forsheda. An appropriate approach for
this research is to conduct direct observations, which can be held throughout a working
day and include everything seen, heard, and experienced (Yin, 2018). The two main types
of observations, structured and unstructured, should, according to Thomas (2017), be
viewed as a spectrum where it is possible to move freely. This mindset was used for this
thesis, as it provided the possibility to observe the work process as in an unstructured
observation solely, but at the same time, allowed for minimal involvement in the process,
as in a structured observation, to avoid a reactivity bias from the employees. Two
non-participatory observers conducted all observations individually but simultaneously,
and the notes were later compared and combined, increasing the observations' reliability
(Yin, 2018). The observations recorded were done on two different weekdays to rule out
the probability of this affecting the state of the production warehouse. In Table 3.2
below, an overview of the observations has been compiled. During the completion of
this project, a total of four observations were conducted.
Table 3.2: An overview of the observations performed for data collection.

Date Time of day Duration (min) Observation location
20/1-2023 9.30-10.30 60 min Production floor & warehouse
29/3-2023 10.05-10.15 10 min Production floor, forklift aisles & warehouse
29/3-2023 12.55-13.10 15 min Production floor & warehouse
29/3-2023 15.05-15.15 10 min Production floor, truck terminal & warehouse
3.4 Data Analysis

The data analyzed in this thesis was collected by completing a single case study by
conducting interviews and observations and comparing these data with current literature
on the topic. During the data analysis phase, the collected data was continuously
reviewed to ensure that the empirical findings presented were appropriate to answer the
research questions, which is crucial, according to David (2006) and Davidson and Patel
(2019). Figure 3.3 below shows an overview of the analysis process and depicts how the
literature was combined with findings to produce an analysis.
19
Figure 3.3: An overview of how empirical data and literature were analyzed.
The authors read the collected data separately during the data analysis to familiarize
themselves with the content. After that, 11 initial codes were produced: lack of
information transparency, conflicting information, checklists & guidelines,
non-value-added activities, pallet movement, efficiency, organizing, pallet racks,
warehousing, forklifts, and packaging materials. At this point, the interview notes were
analyzed separately again while manually highlighting according to the different codes
using separate colors. The highlights were combined with knowledge about literature
studied on the topic, resulting in 8 themes: challenges and current state of the production
warehouse, current pallet handling within the production warehouse, the importance of
having an organized production warehouse, ways of handling packaging material within
the production warehouse, challenges and current state of non-value-added activities in
the production warehouse, efficiency within the production warehouse, checklists and
guidelines within the production warehouse, and previous implementation efforts of the
5S program.
The observations were completed at different times throughout the day, and directly after
completing an observation, all information that had been observed was written down
separately before being discussed, as this helps to ensure unbiased answers (Davidson &
Patel, 2019). If any observations were unclear, a decision was made to go and observe the
same thing again to create clarity.
20
3.5 Data Quality

Data quality is fundamental in a report as it aims to present several logical findings of
high quality (Yin, 2018). The data quality is determined based on factors such as internal
and external validity, reliability, and ethical considerations (Yin, 2018).
3.5.1 Internal Validity

Internal validity refers to how trustworthy the findings are and the degree of confidence
that they have not been impacted by external factors (Streefkerk, 2022). To ensure the
internal validity of the findings of this thesis, interviews were conducted with employees
with 5 different roles within the case company. This provides information from the levels
affected by the problem, thus not being biased toward one single perspective. The
internal validity is also increased due to the triangulation of the data collection methods,
as conducting interviews and observations provides a comprehensive understanding of
the situation. Further, all interviews were recorded, and notes of important information
were taken during all interviews and observations to verify that no essential information
was missed. A member check was performed with all interviewees throughout the
interviews to ensure a truthful interpretation of the answers. No interviewees were given
access to the questions before the interview to minimize the risk of external factors
influencing the answers, thus increasing the internal validity. Lastly, internal validity was
established by not disclosing the interviewees to the public to reduce any external
influence that could have affected the judgment of the interviewee.
3.5.2 External Validity

External validity is achieved if the findings of a research are generalizable to other
scenarios apart from the original study area (Yin, 2018). The research findings are
deemed externally valid as the study was conducted at a production warehouse, a
standard setting for organizations that produce any product. While certain problem areas
might be specific to the case company, the suggested solutions apply to most firms,
increasing the study's external validity.
3.5.3 Reliability
The goal of ensuring that research is reliable is to ensure that the findings can be
replicated if another researcher recreates the research later (Yin, 2018). Because of the
general setting of the production warehouse, the findings would be nearly identical if the
research was replicated. Another way of ensuring reliability is by completing thorough
documentation of the process before, during, and after the study, which was done, and
presented in this thesis, thereby increasing the reliability. Another aspect that increases
the reliability of the findings from this thesis is that the interviewees all work within the
field and in close connection with the identified problem area. This ensures that the
knowledge received accurately reflects the situation and is appropriate for the thesis.
21
Moreover, 14% of the employees working at Forsheda within five departments were
interviewed, increasing the findings' reliability. An even bigger sample size would have
further increased the findings' reliability, but the percentage was deemed sufficient for
this research. Further, the interviewees were informed of their anonymity before the
interview conduction, which eliminated external pressure and protected the employees,
thus increasing the honesty of the answers (Yin, 2018). Lastly, two observers performed
all observations, which increases the reliability as all recorded observations were
discussed and combined.
3.5.4 Ethical Considerations

For this research, all interviewees were kept anonymous to ensure the correct data
handling; further, before recording any interviews, the respondents provided consent.
The interviewees were informed before the interview that they had a right to cancel at
any time and withdraw consent after the interview, which would have meant that non of
the answers would have been used in the thesis. The interviews were conducted in
Swedish as this is the company's operational language, allowing the interviewees to
answer the process-related questions in the language they operate in. As the interviews
were conducted in Swedish, the findings were translated into English for this thesis. Both
authors translated the interview answers separately, and when finished, the answers were
compared, combined, or adapted to minimize the risk of translation bias.
22
Empirical findings
4 Empirical Findings
This chapter aims to familiarize the reader with the case company and its current state of pallet handling
within its production warehouse and address the problems during pallet movement and pallet racking.
4.1 Case Company

Proton Finishing AB provides surface treatment to products that customers send
(Purchase & Logistics Developer). The case company does not produce any products;
thus, the following chapter depicts the visualization of products through only the surface
treatment process at the production warehouse.
4.1.1 Problem Statement at the Case Company

The Purchase & Logistics Developer believes minimizing pallet movement within the
production warehouse is necessary to optimize the pallet flow. Further, there are
challenges when performing daily work tasks in the production warehouse due to lack of
space and long distances (Purchase & Logistics Developer).
According to the Purchase & Logistics Developer, the case company currently has no
clear overview of the pallet movement between the different processes in the warehouse
and production. It is believed necessary to map and analyze the internal logistics flow to
find areas of improvement and develop the case company's material- and production
flow (Purchase & Logistics Developer).
4.2 Interview Findings

Findings from all five interviews have been combined into eight themes to provide a
holistic view of the situation at the case company from many different perspectives.
4.2.1 Ideal Pallet Flow at the Case Company

Figure 4.1 below depicts the ideal internal pallet flow according to the Site Manager. The
ideal flow is based on the notion that no non-value-added activities occur, which is not
the current case, and thus the figure represents a goal. The map visualizes the entire
production warehouse and represents the nine steps in the pallet handling process.
23
Empirical findings
Figure 4.1: An overview of what the ideal Pallet flow at the case company would look like.
Step 1: Inbound logistics

Proton Finishing AB provides surface treatment for customer-supplied products, which
enter the production warehouse during this first step of the internal pallet flow.
Customers themselves decide which third-party logistics firm to use when transporting
their products from their facility to Proton Finishing AB in Forsheda, but Proton is
responsible for booking the transportation to their inbound logistics gate.
Step 2: Registration of incoming material

The warehouse workers place the incoming pallets in the registration area, where all
pallets are registered, into the Warehouse Management System (WMS), which was
implemented two years ago. All pallets are assigned a ‘work card’ that provides
information regarding which customer the products belong to and which surface
treatment method will be used. After being registered, the internal logistics planner
creates a production plan specifying which products to run, including a schedule over the
five production lines and information regarding when the products will be treated.
Step 3: Pallet racking

The registered pallets are placed wherever the warehouse workers find room in the pallet
racks. All pallet racks within the warehouse are numbered to support the WMS, which
the warehouse workers use to locate pallets due to be treated.
Step 4: Pallets placed and waiting for production

Based on the production plan, the warehouse workers collect the pallets due to be treated
and place them in the area designated for the specific production line for that product.
24
Empirical findings
Step 5: Production
Five different production lines are used to treat the products, and the one used depends
on the shape and size of the products. The production plan determines which production
line to use.
Step 6: Quality control

The finished products are checked by the production operators and one quality operator.
Defected products are reworked immediately by the production, which gives the
products an extra layer of surface treatment.
Step 7: Packaging
The pallets are either bundled at the quality control area or moved to the packaging area
for additional packaging.
Step 8: Placed waiting to be shipped

The warehouse workers place the pallets at ‘the square’ before being returned to the
customer. ‘The square’ has defined areas where to place the pallets according to which
customer the products belong.
Step 9: Outbound logistics

Finally, the pallets leave the production warehouse and are shipped to their customer.
These nine steps describe the Site Managers’ view on how the ideal pallet handling would
look at the case company. However, based on information from other respondents, this
is not currently the case, and therefore the following subchapters will describe the
situation from all perspectives.
4.2.2 Challenges and Current State of the Production Warehouse

According to the Logistics Manager, the pallets within the warehouse are placed based on
which production system to use. The Site Manager states that the aim is to finish the
pallets within 5, 10, or 15 days from arrival, as they are treated as soon as possible and
then placed in the warehouse while waiting for the next step of the treatment process.
The Warehouse Worker and Logistics Manager claim that it takes around 7 days for
customers’ products to be treated and ready to get picked up.
According to the Site Manager and Logistics Manager, the Warehouse Management
System (WMS) is used to locate pallets within the production warehouse. It is used by
warehouse workers when moving pallets from the warehouse to the different production
lines. Further, operators from the production use WMS to find the correct location of
the pallets since the system manages all pallet racks (Site Manager).
25
Empirical findings
The Logistics Manager claims that the pallets within the production warehouse can not
be placed according to which customer the products belong; instead, the WMS is used to
keep track of the pallets. In addition, the Logistics Manager expresses that the WMS is
challenging to use and experiences that additional work is dedicated to resolving issues
when the system fails or operators misuse it. Further, operators rely on the system during
pallet racking, but the WMS loads for 10 seconds every time, which causes the user to
wait. The waiting time leads to frustration and an unbalanced production flow (Logistics
Manager).
4.2.3 Current Pallet Handling within the Production Warehouse

The Logistics Manager experiences difficulty knowing where to place pallets within the
production warehouse due to lack of space. The Warehouse Worker agrees and claims
that excess inventory is placed at a separate location due to lack of space which results in
challenges for the warehouse workers that “Often need to move wrongfully placed pallets as they
prevent other pallets from being stored correctly” (Warehouse Worker).
Due to the weight of the pallets, forklifts are used to move them around the production
warehouse. The forklifts used in the production warehouse are semi-automatic, “There are
four forklifts located in the warehouse, and six to seven forklifts are used in the production” (Logistics
Manager). The Warehouse Worker claims that the forklifts are used frequently and
experiences a need for more. “Due to the lack of forklifts, operators often borrow each other’s
without returning them, resulting in spending time to find the forklift again” (Warehouse Worker). In
contrast, the Site Manager states that the organization can remove one forklift due to low
utilization. However, the Warehouse Worker and Logistics Manager claim this is
impossible; according to the Logistics Manager, the only option is replacing too advanced
forklifts with smaller ones within the production.
The Site Manager states, “There is much free space within the production warehouse, and the
occupancy is stable.” However, the Warehouse Worker, Logistics Manager, and Production
Manager claim that there is a lack of free space in the production warehouse and would
like to improve this. The Warehouse Worker does not know why the case company
receives more products from one customer when the first batch is incomplete and urges
the management to “Not take in more pallets than there is room for.” Further, the Logistics
Manager and Warehouse Worker claim that the lack of free space results from high
occupancy. Warehouse workers are trying to solve this problem by stacking the pallets on
each other. The Warehouse Worker states that this “Limits the accessibility since all pallets
above must be removed to access one at the bottom.” According to the Logistics Manager, who
believes all pallets are easy to access, this is not a problem.
The case company has one customer that stores untreated products in the production
warehouse due to decreased customer demand. The Site Manager knows why the
customer’s products are stored and waiting in the production warehouse and claims, “It is
important to help each other; the customer can not control the events happening in the world.” However,
26
Empirical findings
the Site Manager does not know that this makes the daily tasks of the warehouse workers
more challenging to execute, which the Warehouse Worker states while expressing
frustration over the situation.
According to the Warehouse Worker, “Pallets are positioned all over the production warehouse and
are placed wherever there is space in the racks.” Further, not everyone considers where and how
they place pallets in the production warehouse, often leading to small pallets being placed
in racks meant to hold more oversized pallets. Moreover, if the pallets are not straightly
positioned, they take up more space in the rack than needed. According to the
Warehouse Worker, there are no guidelines on where to place a pallet within the
production warehouse, and “This results in additional time spent on replacing the wrongfully placed
pallets.” During pallet racking, the Warehouse Worker claims that they do not know when
the pallet is supposed to go into production and therefore find it challenging to optimize
the pallet racks according to the production plan. According to the Site Manager,
“Warehouse workers are supposed to place the pallets that are soon to be treated closer to production.”
However, the Logistics Manager states that the pallets can not be scheduled in the
production plan before arriving at the production warehouse.
4.2.4 The Importance of Having an Organized Production Warehouse

According to the Site Manager, “The production warehouse is provided with signs and lines on the
floor that shows where all pallets are supposed to be stored.” However, the Warehouse Worker and
the Logistics Manager stated the opposite. They also experienced that when lines exist,
operators often place pallets outside the lines, which causes warehouse workers to move
them additional times. According to the Logistics Manager, “They started to label places with
pictures of where equipment in the production is supposed to be located [...] this can be further improved
and implemented throughout the facility”. In addition, the Site Manager states that the
organization has a specific place where all damaged tools are being placed, and according
to the Production Manager, it is the operator's responsibility to detect and sort out the
damaged tools.
4.2.5 Ways of Handling Packaging Material within the Production Warehouse

The case company recently changed its way of placing orders for packaging material.
Today they place a new order every week instead of whenever they need new packaging
material. According to the Warehouse Worker, this more structured way reduces pallet
handling. The Logistics Manager agrees, stating, “The company has better control over the
packaging material flow than before since that routine was unstructured and led to excess inventory.”
Both agree that the packaging material is somewhat gathered in one place; however, there
is a need to assign fixed locations for the packaging material, including signs which
indicate where the different materials belong.
27
Empirical findings
The Site Manager claims the packaging material is kept at different locations in the
production warehouse because of the extensive volume. According to the Warehouse
Worker, “The packaging material used to be gathered in one location but was recently relocated due to
excess inventory.” The Logistics Manager claims this is an ongoing issue and that “All
packaging material is manually moved from one location to another when restocking the packaging
material at the first location.”
4.2.6 Challenges and Current State of Non-value-added Activities in the Production

Warehouse
Regarding non-value-added activities, the Site Manager states that no current regulations
are implemented to promote lean working; instead, the organization has some
“Recommendations within the daily work,” and the Logistics Manager believes lean work to be
“Common sense.” Despite this, within the production warehouse, activities without value
for the final customer are completed (Site Manager, Warehouse Worker, Logistics
Manager, and Production Manager). For example, the Warehouse Worker believes that
when the operators manually approach the warehouse personnel to ask for a pallet to be
picked up, it does not bring value to the end customer. The Logistics Manager also states,
"Verbal communication is used throughout the operation to signal that a pallet is ready to move on.”
Moreover, it is not unusual for a pallet to be moved more than eight times throughout
the process, which is partially due to the relatively long distances within the production
warehouse as they have to “Pick up a pallet and transport it to another section to bundle it”
before shipping it to customers (Warehouse Worker). Unnecessary transportation also
occurs when pallets in ‘the square’ must be moved to prepare space for pallets delivered
later that week (Warehouse Worker). This is not an unusual task and happens due to the
limited amount of space in the incoming area. Further, registering the incoming pallets is
error-prone, and the Warehouse Worker states that it happens regularly that a worker
registers incoming pallets wrong, thus creating extra work as this process has to be
redone.
The Warehouse Worker believes that too much inventory is currently being held in the
production warehouse in the form of pallets waiting on additional information from the
customer. Further, the Logistics Manager states, "An abundance of specific packaging material
that certain customers require that takes up valuable space that could be better utilized as it currently
clutters the production warehouse.” Another non-value-added activity that the Logistics
Manager believes happened during the implementation of the WMS is that complaints
put forward by employees about the system's complexity were not considered when
implementing, thus not using the employees’ talents. Moreover, none of the Site
Manager, Warehouse Worker, Logistics Manager, or Production Manager were unaware
of this thesis work, and their input had not been considered when formulating the
problem statement, thus not using their talents.
28
Empirical findings
Regarding waiting time, The Site Manager believes pallets should be rapidly processed as
they are the customers’ property. Therefore the case company’s mindset is to keep
pushing the pallets out to have them ready for delivery when the customer requests them.
On the contrary, the Logistics Manager believes there are many instances when the
pallets are standing still due to a lack of time pressure from the customer, thus
contradicting the prior statement.
Defective products are found daily after their surface treatment in production and are
directly reworked by the production (Site Manager, Logistics Manager, and Production
Manager). According to the Logistics Manager, defects are sometimes found by
customers, and to minimize this, operators double-check the pallets before shipping them
to customers. Products that multiple times have been found defective by customers
receive extra support in the form of an employee visiting the customer to perform
additional checks (Logistics Manager). Operators have raised the awareness of defective
products after an increase of defective products in the previous operational year, and
therefore additional quality controls are performed on all products (Logistics Manager
and Production Manager).
4.2.7 Efficiency within the Production Warehouse

According to the Site Manager, “Maintaining an efficient work process that is constantly striving
forward and trying to implement ways of working faster and more efficiently without wasting resources” is
deeply rooted in the case company culture, which the Production Manager confirms.
According to the Site Manager, this mindset has been ongoing for many years within the
organization, which is further supported by the Production Manager, who believes that
“Adequate support is given to employees seeking to develop efficiency in their work.” While the Site
Manager and the Production Manager believe that an efficient mindset is implemented
into all aspects of the operation, the Warehouse Worker and the Logistics Manager state
that efficiency within pallet handling has not been discussed with them, contradicting the
previous statements.
Implementing the current WMS system “Has massively developed warehouse efficiency as it
provides easy access to the location of different pallets without manually searching” (Logistics
Manager). Further, the necessity to produce big orders at a time is emphasized as this
utilizes the production machines to their full extent, thus increasing production
efficiency.
4.2.8 Checklists and Guidelines within the Production Warehouse

Implementing the method First In, First Out (FIFO) has allowed the organization to
keep a desirable lead time, and it is used to prioritize customer orders (Logistics
Manager). Recently there has been a change in the guidelines for the warehouse
personnel as there now is a rotating schedule that makes the different responsibility areas
more clear (Warehouse Worker). Daily safety checks are also performed on the forklifts
29
Empirical findings
used to move pallets. However, the Warehouse Worker states, “These are easy to intentionally
omit due to a lack of employee motivation and general disinterest.” An electronic checklist will be
implemented to prevent this, increasing the chance that they are completed daily
(Logistics Manager).
All interviewees agree that there is a lack of a checklist when cleaning the facility, and
there is a need to implement a solution; according to the Warehouse Worker as “It is dirty
everywhere, and very dusty [...]. If you clean one day, then it is dusty again the day after”. This is
further supported by the Logistics Manager, who believes the newly implemented
cleaning routine on Fridays is a good first step but states insufficient time to complete it.
The Warehouse Worker expresses frustration over the lack of pallet placing guidelines.
This results in incorrect placement by employees, resulting in time-consuming work
when these pallets have to be repositioned. Moreover, when placing the pallets in the
pallet racks, there are no official guidelines for the weight limit. Employees are instead
“Expected to ‘feel’ the heaviness of a pallet when lifting it and then know where the pallet should be
placed.” Despite the frustration over the lack of guidelines, the Warehouse Worker believes
it to be challenging to standardize all work tasks to the degree needed for guidelines and
checklists to be successful, but believes it to be possible when for example, registering
incoming pallets.
4.2.9 Previous Implementation Efforts of the 5S Program

The Site Manager, Logistics Manager, and Production Manager mentioned that the
organization has tried implementing a 5S program several times. According to The Site
Manager, they have made 5-6 attempts to implement the program in the whole
organization, starting with sorting and straightening, but never succeeded. The plan was
to have one person in charge of the 5S program, but they failed after a couple of months
due to a lack of engagement (Site Manager). The Production Manager claims they tried to
implement the 5S program last year but were unsuccessful due to lack of time.
The 5S program is something the company wants to apply, and everyone is supposed to
clean after each work shift, but in reality, this does not occur (Site Manager). All
interviewees stated that the company cleans every Friday, which was implemented a
month ago, according to the Warehouse Worker. The case company also arranges two
cleaning days yearly, but this amount is insufficient (Site Manager). The Warehouse
Worker claims that everyone has improved their ability to sort, clean, and keep the
production warehouse organized, but there is a continued need for cleaning and
removing redundant equipment.
30
Empirical findings
4.3 Observation Findings

All observations conducted had different focal areas based on information received from
the different interviewees, and therefore the information is divided observation-wise and
not mixed. Further, aspects noticed during all observations were combined to show that
they were recurring and not one-time incidents.
4.3.1 Recurring Observations

During all observations, it was noticed that the pallet racks were, what visually can be
described as filled to their maximum capacity, and that pallets were stacked on top of
each other both on the floor, but also within the racks, thus limiting the accessibility.
Further, it was observed that there was a constant movement within the facility by both
forklifts and workers. Lastly, during all observations, it was noticed that pallets containing
untreated products were standing on racks labeled ‘finished products.’
4.3.2 First Observation

A general overview of the production warehouse was provided during the initial
observation, which lasted 60 minutes. A warehouse map without annotations can be
found in Appendix 1. As seen in Figure 4.2, the inbound and outbound locations were
observed along with the pallet racks that ideally would store pallets for specific
production lines; however, it was observed that this was not entirely followed due to a
lack of space in certain areas. Moreover, the outbound logistics area was observed where
pallets were lined up to prepare for shipment, and ‘the square’ is used for various
purposes, such as storing pallets that have just arrived and storing finished products in
preparation to be delivered to customers.
Figure 4.2: Main takeaways from the first observation.
31
Empirical findings
4.3.3 Second Observation

During the second observation, it was observed that the production warehouse was
storing a massive amount of pallets in an area that was previously used to store packaging
material, as seen in Figure 4.3 below. These pallets contain untreated products that the
customer does not want to be treated for an extended period due to a decrease in sales in
the market. The packaging material previously stored there has now been spread out
throughout the production warehouse, as observed in a later observation (see Figure 4.5).
Figure 4.3: Main takeaway from the second observation.
4.3.4 Third Observation

During the third observation, it was observed that multiple pallets that were missing
information from customers were taking up space in the inbound warehouse, depicted by
the purple oval in Figure 4.4. The orange oval shows where pallets are registered after
entering the warehouse; however, there is a lack of space in this area, resulting in pallets
being placed in the aisle, depicted by the red oval, thus blocking access to these pallet
racks. Further, it was observed that within the green oval area, there were no clear forklift
aisles which resulted in pallets, workers, and idle forklifts blocking the accessibility of
forklifts. During this observation, it was noticed that there was an overall lack of lines on
the floors within the production warehouse to indicate where to place pallets and which
pallets to place where. Lines that did exist were highly faded, which resulted in pallets
being placed wrongfully. However, even in the areas where lines were clear, it was
observed that some pallets were standing across the lines and not within them.
32
Empirical findings
Figure 4.4: Main takeaways from the third observation.
4.3.5 Fourth Observation

During the fourth observation, the different pallet storage areas not located in the
inbound section were observed more closely, as depicted in Figure 4.5. Pallets with
products to be treated in production line 4 (orange oval) were kept within the purple
oval. Just below these racks (red rectangles), the finished products from this production
line were kept until moved to the outbound area. The pink oval depicts pallet racks
where products that will be treated in production line 3 (green oval) are stored. It was
observed that these racks are far away from where they will eventually be treated. When
the products get treated, they are moved through the ‘forklift aisle’ that is newly built. On
one side of the forklift aisle, products that will soon be treated are placed (yellow arch);
on the other side, products that have been treated are placed (green arch) before being
moved to either be packed or shipped straight to the customer. The pink crosses in
Figure 4.5 show all the locations where packaging material is kept. Three of these four
locations are inside the production warehouse, and the fourth is outside the production
warehouse underneath a roof where the trucks drop off and pick up products (blue
rectangle). It was observed that there are too few signs that specify where different
packaging material was placed, and it was also not specified where they should be placed
when arriving at the production warehouse.
33
Empirical findings
Figure 4.5: Main takeaways from the fourth observation.
34
Analysis
5 Analysis
This chapter aims to combine literature with empirical findings to answer the research questions, thereby
guiding production warehouses by providing implementation recommendations. The findings within the
previously identified themes have been combined and supported with information on the eight wastes and
the 5S program to answer the two research questions.
5.1 How can Pallet Handling within a Production Warehouse be Improved by

Eliminating Non-Value-Added Activities?
Eliminating non-value-added activities within a company ensures that none of the eight
wastes interfere with an organization’s mission to become lean (Myerson, 2012). Pallet
handling within a production warehouse is, to a certain degree, required for business
operations as pallets must move within a production warehouse, but the non-essential
motions should be eliminated (Abideen & Mohamad, 2020). The Purchase & Logistics
Developer at the case company believes that minimizing pallet movement is vital to
optimizing the pallet flow within the organization, as stated in section 4.1.1. To achieve
this, it is vital to map and analyze the internal logistics flow, separating necessary activities
from non-value-added ones and thus showing which ones to eliminate (Liker, 2004).
5.1.1 Overproduction
Overproduction pushes products through processes and involves processing, producing,
or ordering products before they are needed (Liker, 2004; Myerson, 2012). As stated in
the empirical findings 4.2.6, products are continuously moving forward in the production
warehouse since the case company has the mindset of pushing pallets out of production
to store them in the warehouse and ready for delivery when the customer requests them
(Site Manager). This points to the proposition that the case company engages a mindset
of Just-in-Case, which is, according to Myerson (2012), a consequence of overproduction
that does not support the lean mindset of Just-in-Time. Overprocessing can generate
excess inventory, longer lead times, overstaffing additional transports, and increased
defects (Liker, 2004; Myerson, 2012). The case company is experiencing many defective
products and has implemented additional quality controls. Despite these, defective
products go undetected by the case company and result in customer complaints
(Logistics Manager and Production Manager, stated in section 4.2.6). Myerson (2012)
claims that this is a consequence of a push mindset and that the excess inventory that
overproduction results in makes it more challenging to discover defective products due to
the high amount of processed products.
According to Bozer & Britten (2012), implementing a pull system can prevent
overproduction and decrease the overall inventory level. Further, this can be achieved by
applying a one-piece flow, as one batch is made out of one customer order. As a result,
the company will produce according to what the customer demands rather than pushing
35
Analysis
out the products (Bozer & Britten, 2012). As depicted in Table 5, this could be
accomplished using a Kanban system, as this signals when there is a need for another
pallet (Liker, 2004).
5.1.2 Waiting
Time spent waiting for suppliers, products, materials, or information are all activities that
do not bring customers value and are considered a waste (Myerson, 2012). This also
includes the time workers spend waiting for the tools, machines, and equipment resulting
in delays (Liker, 2004). As presented in section 4.2.2, it was found that the workers at the
case company experience delays in the warehouse management system as it loads for
about 10 seconds whenever used, which the Logistic Manager believes causes frustration
for the warehouse workers and results in an unbalanced production flow. This implies
that waiting time not only causes delays in the material- and information flow, it affects
the work ethics since it also interrupts the production flow.
According to Myerson (2012), it is common to disregard the time a pallet is idle as a

standard business process. Further, the next step of the process often generates idle time
due to long setup times and large batch sizes, which results in additional time spent
waiting. According to the observations and interview findings, the waiting time for pallets
is a natural part of the business process as pallets are temporarily placed outside the
production while waiting for the next step in the surface treatment process (Site
Manager, as stated in sections 4.2.4 and 4.3.5). In addition, the company has many pallets
in the warehouse waiting for additional information from customers, which prevents the
company from processing them, resulting in excess inventory (Warehouse Worker, as
reported in section 4.2.6). To reduce the waste of waiting in a company, it is
recommended to apply the third principle of lean, create flow, as seen in Table 5 (Tahboub
& Salhieh, 2019). This will prevent delays and ensures that the business process flows
smoothly at a high frequency (Lean Enterprise Institute, n.d.b).
5.1.3 Unnecessary Transport

Liker (2004) states that unnecessary transportation includes any non-essential movements
of material or when moving work in progress (WIP) inventory for too long distances
within a warehouse. These movements include equipment, employees, supplies, and
information (Myerson, 2012). As reported in section 4.1.1 by the Purchase & Logistics
Developer, the case company struggles with pallet handling due to the long
transportation distances. The Warehouse Worker further supports this in section 4.2.6,
stating that a pallet is moved about eight times due to long distances between the
processes. This matter was also observed, as declared in section 4.3.5, and the pallets are
not consistently stored near where they will be treated.
36
Analysis
According to Myerson (2012), the ideal way to handle pallets is to move inbound material
once when putting them away and a second time when it is time to process the materials.
In reality, products are often moved multiple times before being placed correctly,
resulting in increased product movement and the risk of misplacing the products,
generating additional labor (Myerson, 2012). According to the Warehouse Worker
(reported in section 4.2.3), there is unnecessary transport due to misplaced pallets which
generates additional transport of pallets before they arrive at their correct location.
Moreover, as stated in section 4.2.6, the Warehouse Worker also experiences unnecessary
movement at ‘the square’ since warehouse workers need to additionally move pallets to
prepare space for pallets delivered in a couple of days. This additional transport of pallets
is standard at the case company and is a result of the limited space in the inbound
logistics area.
Abideen and Mohamad (2020) state that the transport of equipment, employees, and
pallets should be eliminated to reduce accidents at the workplace, as unnecessary
transport bring an added risk for injuries, equipment harm, and collision. Currently, at
the case company, the Logistics Manager claims that verbal communication is used
throughout the entire operation to signal when a pallet is ready to move. The Warehouse
Worker believes this is unnecessary as it requires production workers to physically
approach a warehouse worker for transport assistance (declared in section 4.2.6). As
shown in Table 5, implementing a Kanban system could eliminate this work process, as
this automatically signals that assistance is required (Liker, 2004).
According to Soliman (2017), unnecessary transport is often a result of poor facility

layout, which Myerson (2012) believes can be reduced by developing the overall layout
and including shorter distances between the processes and prioritizing pallet racks based
on fast and slow-moving products, achieving one-piece flow. Moreover, by improving the
facility layout, it would increase the possibility of implementing automatic guided vehicles
(AGV) (Martinez-Barbera & Herrero-Perez, 2010), which would further cancel out
human factors and thus minimize the risk of accidents (Moshayedi et al., 2019).
In conclusion, multiple unnecessary types of transport currently occur at the case

company. By improving the facility layout and shortening the transportation distances,
eliminating verbal communication, and ensuring correct pallet placement from the
beginning, this waste can be reduced, which could result in more efficient operations
(Bowersox et al., 2013).
5.1.4 Overprocessing
Overprocessing includes unnecessary steps in production or using inadequate tools for
the process (Liker, 2004). Within the production warehouse at the case company, pallets
are moved by using semi-automatic vehicles (Logistics Manager as reported in section
4.2.3), which could cause additional transport and overprocessing, as pallet moving
methods involving manual force should be avoided (Tahboub & Salhieh, 2019).
37
Analysis
Overprocessing includes unnecessary steps in production or using inadequate tools for

the process (Liker, 2004). In accordance with Table 5, one solution is implementing
AGVs in parts of the facility, which will likely reduce pallet handling (Tahboub & Salhieh,
2019). As reported in section 4.2.3, there are other sections of the facility where less
advanced semi-automatic forklifts can be implemented, as the Logistics Manager at the
case company believes the current ones to be too advanced, which Myerson (2012)
claims are a waste.
According to the findings in section 4.2.7, the Logistics Manager believed that the
warehouse management system (WMS) currently used at the case company is an efficient
method to accurately store and locate pallets within the pallet racks while keeping them
organized, which is supported by Ramaa et al. (2012). However, the Logistics Manager
believes that the system is difficult to use and additional work is required as employees
misuse the system, which results in overprocessing tasks (as presented in section 4.2.2).
By investigating the functionality of the WMS and potentially removing unnecessary
features, it could create a more user-friendly system that is less advanced and would thus
eliminate the waste (see Table 5).
5.1.5 Excess Inventory

The Site Manager claims in section 4.2.3 that the production occupancy is stable and that
there is much free space to locate pallets within the production warehouse. However, this
contradicts what the Warehouse Worker, Logistics Manager, and Production Manager
claim; they experience a lack of free space in the production warehouse due to high
occupancy (as stated in section 4.2.3). This discrepancy suggests a lack of operational
transparency throughout the organization, which should be ensured to minimize errors
(Myerson, 2012).
Further, it is currently difficult to know where to place pallets due to excess inventory
causing warehouse workers to move the additional inventory to a separate location,
resulting in challenges in performing their daily tasks (Warehouse Worker, established in
section 4.2.3). According to Liker (2004), excess inventory includes storage of WIP
inventory and storage of finished products resulting in increased storage and
transportation costs, longer lead time, and delays. Excess inventory increases the risk of
not detecting hidden problems such as supplier delays, imbalanced production, and
defective products (Liker, 2004). Reasoning from this fact, the Site Manager has a false
performance perception since the given information contradicts what the Warehouse
Worker states when addressing the challenges caused by excess inventory. This is also
supported by the Purchase & Logistics Developer in section 4.1.1, who claims that there
are challenges when performing daily work tasks in the production warehouse due to the
lack of space resulting from pallets being stored there too long. These disagreements
suggest a lack of transparent communication, which Myerson (2012) claims would
facilitate pallet handling.
38
Analysis
Moreover, as recorded in section 4.2.3, the Site Manager states that one customer is
affected by decreased customer demand and therefore stores untreated products at the
case company’s production warehouse, which was observed (presented in section 4.3.3).
The inventory takes up space and causes additional work when monitoring and moving
the inventory (Tahboub & Salhieh, 2019). However, the interview data in section 4.2.3
suggest that the Site Manager is unaware that this makes the warehouse workers' daily
task performance more challenging while generating additional waste, such as
unnecessary movements, defects, overprocessing, and unnecessary transportation
(Warehouse Worker). According to Tahboub & Salhieh (2019), this waste can be
eliminated by establishing a pull system where the production plan is based on customer
demands. As depicted in Table 5, Kanban is a suitable tool to implement when
establishing a pull system since the tool sends signals to the previous step in the business
process when pallets are ready to be moved (Liker, 2004).
5.1.6 Unnecessary Movement

The waste of unnecessary movements in a warehouse includes stacking, walking,
searching, and reaching (Liker, 2004). As stated in section 4.2.2 of the empirical findings,
WMS is used to help workers locate pallets and has helped the case company reduce their
unnecessary movements and improve efficiency (Logistics Manager). However, additional
searching occurs due to a lack of forklifts as operators often borrow each other forklifts
without returning them, resulting in time spent on locating them again (Warehouse
Worker, as reported in section 4.2.3).
Unnecessary movements within a warehouse appear when inventory is placed too high or
low, forcing employees to reach or bend when picking the orders (Tahboub & Salhieh,
2019). The lack of free space at the case company’s production warehouse results in
stacking the pallets on top of each other (Logistics Manager, as reported in section 4.2.3).
As stated in section 4.2.3, the Warehouse Worker and Logistics Manager claim that the
lack of free space in the production warehouse causes warehouse workers to stack pallets
which the Warehouse Worker believes limits the accessibility of the pallets. According to
the Logistics Manager, stacking does not affect the accessibility of the pallets, and all
pallets are easy to access despite being stacked. On the contrary, stacking and making the
pallets inaccessible is unnecessary since it requires employees to reach for pallets placed
at the bottom or top of the stack (Tahboub & Salhieh, 2019), which was also noticed
during all observations at the case company. To provide easy access within the
production warehouse, it is recommended to apply the 5S program (Liker, 2004). As
depicted in Table 5, the 5S program is applicable when eliminating the waste of
unnecessary movements since one of the 5S aims is to minimize the time a worker has to
leave the workstation (Soliman, 2017).
39
Analysis
5.1.7 Defects and Errors

Liker (2004) defines the waste of defects as processing defective products by reworking,
repairing, or scraping. According to the case company's Site Manager, Logistics Manager,
and Production Manager, defective products are reworked daily. As presented in section
4.2.6, the Logistics Manager claims that customers often detect defective products.
According to Myerson (2012), this is the worst-case scenario since this can result in safety
issues and a lack of trust in the company.
Moreover, Myerson (2012) claims that damaged products might appear due to inefficient
processes or insufficient employee training. Hence, the Production Manager claims in
section 4.2.6 that the case company raised the awareness by operators to detect defective
products. In addition, Tahboub & Salhieh (2019) state that company defects can be
reduced by applying the fifth lean principle, seek perfection, as the company must meet its
customers' requirements (Tahboub & Salhieh, 2019) (see Table 5).
5.1.8 Unused Talent

As stated in section 4.2.6 of the empirical findings, the Logistics Manager claims that the
employees' experiences and knowledge were not considered as the warehouse
management system was implemented, despite being too complicated. Liker (2004) states
the importance of listening to employees and considering ignoring information from
employees as a waste of resources. In addition, it is also considered a waste when
organizations hire external staff instead of utilizing the knowledge of current employees
when improving the organization (Soliman, 2017). This waste occurs in the case
company as none of the Site Manager, Warehouse Worker, Logistics Manager, or
Production Manager have been involved in formulating the scope of this thesis, despite
working with the problem daily (established in section 4.2.6). Given these circumstances,
it could be recommended to start improving and developing projects by listening to
employees to utilize internal knowledge before outsourcing (see Table 5).
5.2 How can Pallet Racks be Organized to Improve Efficiency within a

Production Warehouse?
The 5S program is a suitable tool to implement in a warehouse to eliminate the eight
wastes and improve the overall efficiency, organization level, and responsiveness
(Myerson, 2012; Zagzoog et al., 2019). The program has a higher chance of success by
ensuring that employees are engaged in the implementation and improvement (Wani &
Shinde, 2021). According to the Site Manager in section 4.2.9, the organization and its
personnel are keen to implement the program successfully. Successful implementation
could lead to an improved warehouse layout, well functioning structure, a cleaner work
environment, increased employee morale, and a foundation for future organizational
improvement (Myerson, 2012).
40
Analysis
5.2.1 Sort
When sorting any workstation, it is necessary to prioritize items based on how frequently
they are used (Myerson, 2012), to minimize the time employees have to leave their
workstations (Soliman, 2017). This can be done by implementing the red tag strategy, which
removes infrequently used items from the work area (Myerson, 2012). However, sorting
is complex in a production warehouse as the workstation is large and the workers
constantly move, but sorting the entire warehouse based on how frequently a pallet is
moved is still possible to fulfill this step in the 5S program (Myerson, 2012).
Using the current WMS allows employees at the case company to identify where a pallet
is located relatively quickly, which has increased efficiency (Logistics Manager, stated in
section 4.2.7). Nevertheless, there is currently no organization within the pallet racks,
meaning that pallets with a high moving frequency might be located far away from the
production lines, thus increasing the distance for the operator (Warehouse Worker, as
reported in section 4.2.3). As declared in section 4.2.3, the Logistics Manager states that,
to a certain degree, the production warehouse is meant to be organized to collect all
pallets going to the different production lines in different pallet racks. Still, it was
observed multiple times that this was not followed, probably due to a lack of space
(section 4.3.2). The lack of space further impacts the production warehouse as pallets are
often stacked on each other, as stated in section 4.2.3 (Warehouse Worker, Logistics
Manager, and Production Manager). This requires warehouse workers to sometimes
move multiple pallets to collect the correct ones, a non-value-added activity that should
be eliminated (Bartholdi & Hackman, 2019; Liker, 2004; Myerson, 2012; Wani & Shinde,
2021). In accordance with Table 5, it is recommended that companies trying to
implement the 5S program remove all redundant equipment and items from the work
area and further sort the pallet racks according to pallet movement frequency. This will
result in a more organized environment and increased efficiency (Myerson, 2012).
5.2.2 Straighten
Ensuring that all objects have their specific place is the act of straightening (Liker, 2004;
Mohan Sharma & Lata, 2018). When straightening a workplace, an excellent first step is
to determine and label all items' locations to ensure they are easy to locate (Filip &
Marascu-Klein, 2015; Wani & Shinde, 2021). A concrete example of this has been
completed in the production, where photos of all different attachments needed for the
production are stored (Logistics Manager, reported in section 4.2.4). Further, the
Production Manager believes this can be completed on a larger scale throughout the
production warehouse, as stated in section 4.2.4. Moreover, the Logistics Manager
believes that the case company would benefit from implementing such a system as it, for
example, would distinguish between different packaging materials (established in section
4.2.5). Implementing this throughout the warehouse would massively facilitate and
minimize the search and relocating of tools and equipment (Myerson, 2012; Wani &
Shinde, 2021). If this was implemented, the signs and system must be followed to ensure
41
Analysis
that, for example, no pallets containing untreated products are located under a sign
saying ‘finished products,’ as all of the observations showed (presented in sections 4.3.2,
4.3.3, 4.3.4, 4.3.5). Furthermore, by creating locations for all tools and equipment, the
current work environment within the production where forklifts and pallets block the
aisles would probably be improved and potentially eliminated. For companies to ensure
that all items are located in their designated places, colors and labels can be used along
with lines on the floor, signs, and dedicated areas for specific items (Myerson, 2012).
As further stated in Table 5, creating lines on the floor that clearly show where different
pallets should be placed will straighten the work environment and create a structure that
all employees can follow. These lines would facilitate the different work tasks as
employees would not be required to search for items but simply know where they are
always located (Wani & Shinde, 2021). Further, according to the Warehouse Worker and
the Logistics Manager, this would create a simplified warehouse structure that minimizes
the times a pallet is moved, as it is placed correctly from the beginning (as stated in
section 4.2.4). However, with this change, employees must start to respect and follow the
lines to avoid placing pallets across them, as noticed in the third observation.
5.2.3 Shine
Cleaning a workplace helps to achieve the two main goals of (1) creating a sanitary
workplace and (2) identifying and preventing potential machine failures before they occur
(Liker, 2004; Wani & Shinde, 2021). These two goals also facilitate the process of
identifying defective products at an early stage which prevents additional costs from
occurring (Myerson, 2012). While the current cleaning schedule implemented at the case
company a month ago is an appropriate first step, the effect has yet to occur as it is
constantly dusty, as the Warehouse Worker claims in section 4.2.8. This could be due to
the lack of time for cleaning (Logistics Manager, as stated in section 4.2.8) and that the
cleaning routine after every shift is not followed (Site Manager, as established in section
4.2.9).
Improving the overall mindset of cleaning, sorting, and keeping the production
warehouse organized, as the Warehouse Worker in section 4.2.9 claims to be possible,
and needed, would result in increased work morale among employees and overall work
environment safety (Myerson, 2012). As shown in Table 5, one concrete solution is to
implement cleaning guidelines and increase employee awareness of the benefits of
following these and having a clean workstation (Chiarini, 2013; Wani & Shinde, 2021).
5.2.4 Standardize
Standardizing ensures that guidelines are implemented that help to improve work tasks
continuously (Liker, 2004). Having an organized production warehouse without
standardizing tasks is impossible, as employees will fail to perform tasks in the same way
42
Analysis
if there are no guidelines on how to perform them (Myerson, 2012). This is evident at the
case company, where there are no guidelines on how and where pallets should be placed
in the pallet racks (Warehouse Worker, presented in section 4.2.8). Further, this prohibits
employees from executing the racking process in the same way, thus resulting in small
pallets taking up too much space, which means moving these later to make space for
larger pallets (Warehouse Worker and Logistics Manager, established in section 4.2.3).
Additionally, according to the Warehouse Worker in section 4.2.8, the case company
currently has no official guidelines for the weight limits for the racks, which could prove
dangerous. It makes the employees’ work difficult as they are forced to estimate the
pallet's weight and where it is appropriate to place it, as established in section 4.2.8. There
is also an increased chance of defective products without standardizing the workplace, as
there are no clear guidelines and checklists on how different tasks should be performed
(Myerson, 2012). The lack of guidelines on where to place pallets results in excess
movements when misplaced and increases the risk of damage (Myerson, 2012).
To standardize the work tasks, a standard method must be implemented and followed
(Chiarini, 2013; Wani & Shinde, 2021). As shown in Table 5, implementing standardized
guidelines for how pallet handling is performed would allow the workers to perform the
tasks identically, facilitating the overall work process, reducing defective products, and
ensuring an organized work environment (Myerson, 2012). However, the current mindset
of the Logistics Manager and the Production Manager that was presented in section
4.2.6, who believe that working to remove waste is “Common sense” and “Obvious,” can be a
hindrance as it could cause resistance to standardization.
5.2.5 Sustain
To implement a long-lasting and successful 5S program in any organization, it is
necessary to ensure that it is feasible to continuously follow the steps in the future
(Myerson, 2012). This can be ensured by constantly improving all steps until an excellent
value is reached without any waste (Lean Enterprise Institute, n.d.b). The previous
implementation attempts of the 5S program at the case company have been unsuccessful
despite multiple tries through the years (Site Manager and Production Manager, stated in
section 4.2.9). One potential reason for the unsuccessful tries is that the case company
too abruptly decided to implement 5S by starting with a cleaning day involving all
employees. Not only have they started by implementing the wrong 5S step, but they also
fail at implementing consistency and participant motivation, which are crucial to success,
according to Wani & Shinde (2021). There is little chance of successful implementation
by not implementing the correct first step and not ensuring that the changes can be
sustained in the future (Myerson, 2012). Another critical aspect of success is that all
employees must be given specific tasks to remain engaged (Myerson, 2012). As stated in
section 4.2.9, this was not done correctly, as one reason for failure was the general
disinterest and lack of employee engagement in the project (Site Manager). As depicted in
Table 5, to overcome these problems, the company could start small with the first step
43
Analysis
and gradually implement the other steps along with feasible and maintainable tasks that
can be sustained forever.
5.3 Recommendations
Table 5 below presents shortcomings, causes, recommendations, and expected effects for
organizations trying to improve pallet handling based on the analysis performed. Despite
the shortcomings presented in Table 5 being case company specific, the
recommendations apply to organizations with a production warehouse similar to the one
in the case company that is trying to make pallet handling more efficient. The table is
priority-level based, meaning that the top rows are more time-sensitive than the bottom
ones and that by rectifying some shortcomings, others with a lower priority level might
also improve. The priority is based on what shortcomings the authors of the thesis
consider most severe, but also on the 5S program, where the steps must be completed in
the correct order to ensure success. As depicted in Table 5, some recommendations
apply to multiple identified shortcomings as these have the same root problem and are
appropriate to eliminate multiple wastes and when implementing the 5S program. The
recommendations are relevant for the case company and all organizations with
production warehouses and can be used as guidance when improving pallet handling by
eliminating non-value-added activities and increasing efficiency by organizing pallet racks.
With all of the recommendations, the fifth lean principle: seek perfection, could be
considered as this will help improve all processes and sustain long-term changes by
eliminating waste (Lean Enterprise Institute, n.d.b).
While the table is priority based, the first step when trying to improve a process is,
according to Liker (2004), for decision-makers to observe the process by Genchi
Genbutsu (go-and-see). By doing this, the root cause of the problem can be identified,
and thereby accurate and applicable solutions can be implemented. Therefore, it is
suggested that the recommendations in the table are handled after the root problem has
been identified through Genchi Genbutsu and after what customers deem valuable has
been identified, which is the first lean principle: identify value (Lean Enterprise Institute,
n.d.b).
44
Analysis
Table 5: Identified shortcomings, causes, and suggested recommendations.

Priority level Identified Causes Recommendations Expected effect Applicable
(high-low) Shortcomings for sections
1 Lack of employee Management Start small, implement Successful 5.1.8

involvement and implements drastic changes in the correct implementation of the 5S 5.2.1
engagement when changes without order, and ensure that all program and elimination 5.2.2
implementing involving employees. employees are involved of waste. Increased 5.2.3
organizational and engaged by having a transparent 5.2.4
changes. functioning information communication within 5.2.5
flow. the organization.
2 Verbal Lack of efficient Implement a Kanban Reach the fourth lean 5.1.1
communication and information- and system that signals when principle: establishing pull. 5.1.2
push mindset. material flow. it is time for the next Less overproduction, 5.1.3
step in the process. reduced waiting time, and 5.1.5
fewer unnecessary
transports.
3 Redundant No clear knowledge Sort the equipment Reduced unnecessary 5.1.6

equipment at of what is required based on priority, and employee movement and 5.2.1
workstations. for the work tasks. remove redundant items. clean work environment,
which increases
efficiency.
4 Poor facility Lack of guidelines Create lines on the floor, Cleaner work 5.1.3
structure and lack of and structure. introduce signs, and environment, more 5.2.2
employee awareness establish guidelines for structured work area, 5.2.3
of the existing one. all tasks. possibility to implement 5.2.4
AGVs.
5 Defect products are Lack of thorough Apply the fifth lean Customer demands will 5.1.7
detected by quality checks. principle: seek perfection. be fulfilled, and
customers. long-term customer
loyalty will be reinforced.
6 Excess pallet Semi-automatic pallet Introduce guidelines for Increased efficiency 5.1.4
handling, stacked moving methods are moving, racking, and within the production 5.2.4
pallets, and used in wrongful placing pallets. Minimize warehouse. Standardized
unorganized pallet places, with no clear human involvement in work tasks that all
placement. pallet handling pallet handling and employees can perform.
guidelines. implement AGVs when
possible.
7 Too advanced Lack of knowledge Investigate the current A standardized work 5.1.4
equipment. within the Warehouse Management environment where all
organization about System and remove employees can perform
the requirements redundant functions. the work tasks.
needed to complete Also, remove
different work tasks. too-advanced forklifts.
45
Analysis
5.4 Summary
The following recommendations are given to organizations with production warehouses
that are interested in increasing the efficiency of their pallet handling by eliminating
non-value-added activities and organizing their pallet racks.
● Start small, implement changes in the correct order, and ensure that all employees
are involved and engaged by having a functioning information flow.
● Implement a Kanban system that signals when it is time for the next step in the
process.
● Sort the equipment based on priority, and remove redundant items.
● Create lines on the floor, introduce signs, and establish guidelines for all tasks.
● Apply the fifth lean principle: seek perfection.
● Introduce guidelines for moving, racking, and placing pallets. Minimize human
involvement in pallet handling and implement AGVs when possible.
● Investigate the current Warehouse Management System and remove redundant
functions. Also, remove too-advanced forklifts.
46
Discussion
6 Discussion
This section summarizes the answers to the two research questions presented in the thesis by discussing the
findings and the research implications. Further, a sustainability perspective is provided, and the methods
applied in the thesis are discussed.
6.1 Discussion of Findings

The purpose of this thesis has been to explore ways to increase the efficiency of pallet
handling within a production warehouse. This has been completed by answering two
research questions throughout the thesis. Presented below are the main findings that
previously have been used to answer the research questions.
6.1.1 How can Pallet Handling within a Production Warehouse be Improved by

Eliminating Non-Value-added Activities?
The importance of a well-functioning and efficient supply chain has emerged due to
increasing customer demand for product quality, lower costs, and shorter lead times
(Beamon, 1998; Bowersox et al., 2013; Myerson, 2012). If these activities are not
considered, there is a risk of long lead times, products damaged due to unnecessary
movements, and a push mindset resulting in unsatisfied customers (Soliman, 2017). For
companies to be competitive for a larger market share, it is essential to distinguish the
customers' expectations and identify the actions that bring value to the end product. The
findings in this thesis show that non-value-added activities within a production
warehouse cause inefficiency in pallet handling and material flow. Following the five lean
principles will eliminate the eight wastes and consequently improve pallet handling within
a production warehouse (Myerson, 2012).
6.1.2 How can Pallet Racks be Organized to Improve Efficiency within a Production
Warehouse?
An unorganized workplace will contribute to non-value-added activities as it results in
different movements, excess transportation, and waiting (Zagzoog et al., 2019). This is
problematic in the overall supply chain as it hinders efficiency and, thereby, the
organization's continued development (Janvier-James, 2011). The findings in this thesis
show a need for eliminating non-value-added activities to organize pallet racks and
improve efficiency in the production warehouse, and implementing the 5S program is an
appropriate solution (Myerson, 2012). The production warehouse will become more
organized by implementing the 5S program correctly and ensuring all employees'
involvement, consequently improving efficiency (Myerson, 2012).
47
Discussion
6.2 Implications
This study has different implications - practical implications applicable for managers,
theoretical implications useful for researchers, and an overall sustainability perspective.
6.2.1 Practical Implications for Managers

This thesis explores ways to increase the efficiency of pallet handling within a production
warehouse, which is an essential topic for many companies. This is due to the
globalization of market economies and the forever increasing customer demand for
product quality, lower costs, and shorter lead time, and these aspects are essential to
achieving a well-functioning and efficient supply chain (Beamon, 1998; Bowersox et al.,
2013; Myerson, 2012). The results from this thesis of how to make pallet handling more
efficient could benefit managers as it presents a way for companies to create and
maintain a competitive organization with satisfied stakeholders and an increased
production speed while retaining the overall quality and price of the products. These
characteristics within supply chain management are essential in developing corporate
efficiency (Janiver-James, 2011).
6.2.2 Theoretical Implications for Researchers

The subject of pallet handling is complex, and much research has investigated how lean
in production or warehousing can make processes more efficient by eliminating activities
that do not bring value to the end customer (Bowersox et al., 2013). However, few
studies have been performed on making production warehouses more efficient regarding
pallet handling. This thesis has contributed knowledge to fill this gap by exploring how
lean can be applied in a production warehouse.
6.2.3 Sustainability Perspective

According to Bajec et al. (2020), by introducing a sustainability perspective to the entire
business process, a company can ensure that the organization remains attractive from the
customer's point of view. This can be done by including sustainability within the three
pillars of economic, social, and environmental (Bajec et al., 2020).
The results from this thesis show that implementing lean results in fewer defective
products (Myerson, 2012), which reduces resources as these products often need to be
scrapped, reworked, or repaired (Liker, 2004; Myerson, 2012). Reducing unnecessary
transport will result in shorter transportation distances (Liker, 2004; Myerson, 2012), and
reduced fuel usage (Martin, 2018). The lean method and 5S program also provide a more
efficient workplace that prevents workers from doing heavy lifts, reaching, and bending
for equipment, resulting in a healthier workplace (Liker, 2004). Lastly, successfully
implementing the 5S program would result in a clean workplace, increasing employee
48
Discussion
morale as the work environment directly impacts employees' feelings towards their work
(Myerson, 2012).
6.3 Discussion of Methods

The methods chosen for this thesis work have helped to achieve the purpose and have
provided firsthand insights into the case company and information required to answer
the research questions. Internal validity has been ensured by interviewing five employees
with five different roles, ensuring a comprehensive view of the problem. Further, two
interviewers conducted the interviews, one taking notes to complement the recordings,
and member checks were conducted throughout for correct understanding. The study's
findings and recommendations are generalizable to most production warehouses with
similar size, layout, and problems as the case company face, as the lean method applies to
most manufacturing industries. Reliability was ensured by documenting the work process
and promising all interviewees anonymity, as this increases the honesty of the answers.
Strengths of the thesis include being two objective researchers without previous personal
or professional connections to the case company and conducting all data collections as
two researchers to ensure truthful findings without misunderstandings. A weakness of
the thesis is the limited sample size, and increasing the number of interviewees would
have further improved the internal validity. Before conducting the data collection, it was
believed that multiple reports would be received to be used as a basis for document
analysis. However, only one layout map was received and used during the interviews and
observations; therefore, no further document analysis was conducted. Moreover, by
including the different pallet moving methods in the analysis, more specific
recommendations could have been presented, which would have benefited managers and
researchers. Also, it was realized after conducting the interviews that the number of
questions prepared beforehand was excessive for semi-structured interviews, and these
could have been reduced to allow for more free conversation. Despite this, the
recommendations presented in the thesis are built upon lean, a well-established method
recognized globally for its effectiveness within most companies. Therefore, the
above-mentioned limitations are believed not to impact the thesis results.
49
Conclusion
7 Conclusion
This section aims to conclude the thesis by providing a concluding paragraph, recommendations, and
future research suggestions.
7.1 Conclusion and Recommendations

In conclusion, improving pallet handling efficiency within a production warehouse can
be done by eliminating non-value-added activities and organizing pallet racks. Wastes can
be identified and abolished by identifying what activities bring value to the end customer.
The results show that following the five lean principles; identify value, map the value stream,
create flow, establish pull, and seek perfection, and thus removing non-value-added activities in
combination with organized and well-structured pallet racks will lead to an increased
production speed, improved warehouse layout, a cleaner work environment, and
heightened employee morale. Moreover, these changes can build a foundation within the
organization for implementing changes in the future and a mindset for continuous
improvement, which is essential when implementing lean.
It is recommended for managers to involve all employees when implementing changes as

this ensures that valuable knowledge from employees is taken into account when new
guidelines are created for the work tasks. Further, it is essential that current systems used
in a production warehouse are investigated for suitability, that unsuitable ones are
removed, and that newer, more applicable systems are introduced. Lastly, it is vital to
establish a mindset for continuous improvement, and the organization should seek
perfection constantly to improve the operations continuously.
7.2 Future Research

This thesis has explored a part of efficiency within pallet handling in production
warehouses. However, this topic is complex, and it is suggested that further research is
conducted within the following areas:
● While this thesis contributes to the knowledge of pallet handling within
production warehouses, it is suggested that future research be conducted at
multiple case studies within production warehouses to gain a broader perspective
of the topic.
● Investigating large organizations and including departments not directly linked to
the production warehouse, for example, marketing, sales, and human resources,
to better understand the impact of efficient pallet handling.
● Future research could be expanded to include external pallet handling, as this
aspect impacts the efficiency of the overall supply chain. The existing research
applies to both productions and warehouses but needs to be extended to include
production warehouses as these differ from separate entities.
● As lean involves continuous improvement, companies must consistently apply it,
and research on the topic should frequently be developed and renewed.
50
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order-picking operations in warehouses. Expert Systems with Applications, 36(4),
8277-8301. https://doi.org/10.1016/j.eswa.2008.10.011
Proton Finishing. (n.d.a). Om Proton Finishing | Proton Finishing. Proton Group. Retrieved
March 1, 2023, from
https://www.proton.se/sv-se/finishing/om-proton-finishing/
Proton Finishing. (n.d.b). Våra produktionsbolag | Proton Finishing. Proton Group. Retrieved
March 1, 2023, from https://www.proton.se/sv-se/finishing/produktionsbolag/
52
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Tahboub, K., & Salhieh, L. (2019). Warehouse Waste Reduction Level and Its Impact on
Warehouse and Business Performance. Industrial and Systems Engineering Review,
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April 26, 2023, from https://toyota-forklifts.eu/solutions/operator-training/
Wani, S., & Shinde, D. K. (2021). Study and Implementation of ‘5S’Methodology in the
Furniture Industry Warehouse for Productivity Improvement. International Journal
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World Trade Organization (Ed.). (2017). Measuring and Analyzing the Impact of GVCs on
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http://www.ieomsociety.org/gcc2019/papers/154.pdf
53
Appendices
9 Appendices
Appendix 1 Layout map of the production warehouse at Proton Finishing AB in
Forsheda.
54
Appendices
Appendix 2 Interview Questions
General Questions
● Hur länge har du jobbat på företaget?
● Vad är din arbetstitel?
● Kan du berätta kort om dina arbetsuppgifter?
● Har du jobbat inom olika funktioner inom företaget? Vilka?
● Har du hört talas om Lean som en metod?
● Vet du vad Lean innebär?
● Använder ni idag något system som signalerar när det är dags för en pall att
förflytta sig till nästa steg i processen? (Pull-system, Kanban)
● Jobbar ni idag aktivt för att effektivisera produktion och lager? Hur?
● Har du hört talas om begreppet “non-value added activities”/ icke värdeskapande
aktiviteter?
● Har du hört talas om metoden “to eliminate non-value added activities” eller att
eliminera slöserier?
● Har du hört talas om de 5S:en?
● Gör ni några åtgärder för att uppfylla det första S:et, sortera?
● Gör ni några åtgärder för att uppfylla det andra S:et, systematisera?
● Gör ni några åtgärder för att uppfylla det tredje S:et, städa?
● Gör ni några åtgärder för att uppfylla det fjärde S:et, standardisera?
● Gör ni några åtgärder för att uppfylla det femte S:et, se till/sköta om?
Questions for the Site Manager

● Var du med och skapade detta projekt?
● Vad omsätter Proton Finishing AB årligen?
● Hur många anställda är det på de samtiga enheterna?
● Hur många är anställda på Proton Forsheda?
● På ett ungefär hur många produkter ytbehandlas i Forsheda per
dag/vecka/månad/år?
● Hur många dagar om året är produktionen igång?
● Tar ni in alla produkter som ska ytbehandlas direkt när upphandlingen är klar
eller ber ni kunderna vänta med att skicka dessa tills ni har plats i produktionen?
● Levererar kunderna produkterna som ska behandlas själva till er eller erbjuder ni
hämtning och lämning av produkter?
● Har ni på företaget pratat någonting om lean?
● Har ni försökt att implementera lean i verksamheten
● Är 8 waste något som företaget har diskuterat?
● Gör ni några åtgärder för att minska överproduktion under hanteringen av pallar?
55
Appendices
● Upplever du att produkter placerade på pallar ofta står och väntar mellan olika
processer?
● Upplever du att operatörerna ofta står och väntar för att få nya arbetsuppgifter
eller väntar på att nästa steg i processen ska bli klar?
● Upplever du att det kan bli väntetid för truckförare på lagret?
● Upplever du att onödiga förflyttningar av en pall sker (t.ex. att en pall
mellanlandar någonstans vid avlastning, förflyttning mellan produktion och lager,
mellan olika delar av produktionen, under lagerhanteringen, eller när pallarna
lämnar enheten)?
● Upplever du att vissa steg i processen är överarbetade?
● Händer det att samma arbete utförs två gånger?
● Upplever du att ni använder mer avancerade verktyg än vad ni behöver (t.ex.
truck istället för palldragare eller ett för avancerat datasystem)?
● Upplever du att extra lagerhållning sker på företaget?
● Alla företag har någon form av onödiga förflyttningar, vad upplever du att ni har
här i Forsheda?
● Har ni designat lagret utefter någon specifik modell?
● Hur ser det optimala pallflödet ut hos er?
● Vad gör ni för att upptäcka om produkter är defekta?
● Hur ofta sker det att produkter blir defekta?
● Vart ska defekta produkter förvaras?
● Upplever du att Proton att använder anställdas kompetens till fullo?
● Har ni implementerat 5S i verksamheten?
Questions for the Warehouse Worker

● Känner du till projektet?
● Samarbetar ni med personalen inom produktionen?
● Är 8 waste något som ni inom lagret har diskuterat?
processer?
● Hur många gånger skulle du uppskatta att en pall förflyttas inom lagret?
● Upplever du att onödiga förflyttningar av en pall sker?
● Upplever du några andra typer av onödiga transporter? (operatörer, hjälpmedel)
● Händer det att samma arbete utförs två gånger?
56
Appendices
● Hur länge står en pall med produkter från kunder och väntar på att bli
behandlad? Från att det kommer in tills det kommer ut.
● Vart ställer ni dessa pallar? (Alternativt göra en egen rubrik med placering av
pallar)
● Hur länge uppfattar du att en pall med färdigbehandlade produkter står och
väntar på att kunder kan komma och hämta dem?
● Kan ni boka hämtning av pallar när som under dagen om en pall blir klar?
här i Forsheda?
● Ingår det i ditt arbete att hitta defekta produkter?
● Har någon pratat med dig angående att effektivisera pallhanteringen?
● Har det varit tidigare projekt där man har frågat er hur situationen ser ut etc.
● Jobbar ni efter 5S-programmet?
● Utförs inspektioner av maskiner och verktyg?
● Vad för utrustning används för att förflytta pallar?
● Känner du att det finns något som kan ändras för att göra arbetet lättare/ mer
effektivt?
Questions for the Logistics Manager

● Tar ni in alla produkter som ska ytbehandlas direkt när upphandlingen är klar
eller ber ni kunderna vänta med att skicka dessa tills ni har plats i produktionen?
● Är det du som lägger upp produktionsplanen?
● Finns det sammarbete mellan lager och produktion?
● Är 8 waste något som företaget har diskuterat?
processer?
● Hur många gånger skulle du uppskatta att en pall förflyttas?
● Upplever du att onödiga förflyttningar av en pall sker (t.ex. att en pall
mellanlandar någonstans vid avlastning, förflyttning mellan produktion och lager,
mellan olika delar av produktionen, under lagerhanteringen, eller när pallarna
lämnar enheten)?
● Upplever du några andra typer av onödiga transporter? (operatörer, hjälpmedel)
57
Appendices

● Upplever du att extra llagerhållning sker på företaget?
här i Forsheda?
● Har ni designat lagret utefter någon specifik modell?
● Vart förvaras produkter som ska ytbehandlas en gång till pga. inte godkända?
● Upplever du att dessa tar upp för stor yta/är i vägen för det dagliga arbetet?
● Har någon pratat med dig angående att effektivisera pallhanteringen?
● Har det varit tidigare projekt där man har frågat er hur situationen ser ut etc.
● Utförs inspektioner av maskiner och verktyg?
● Vad för utrustning används för att förflytta pallar?
● Känner du att det finns något som kan ändras för att göra arbetet mer
lättare/effektivt?
● Skulle det underlätta att ha en spcifik gång väg på lager/produktion
Questions for the Production Manager

● Har ni någonsin diskuterat om att implementera lean?
● Sammarbetar ni med lagerpersonal?
● Är 8 waste något som ni inom produktionen har diskuterat?
● Vad gör ni i produktionen för att upptäcka om produkter är defekta?
● Hur ofta händer det att produkter är defekta?
● Utförs inspektioner av makiner och verktyg?
● Känner du att det finns något som kan ändras för att göra arbetet mer
lättare/effektivt?
● Vi har sett när vi har gått runt i produktionen att det står pallar i gången och
förhindrar truckar från att komma fram. Ställs de här av någon speciell
anledning?
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Improving Warehouse

MAIN AREA: Industrial Engineering and Management

Examiner: Marco Santos

Supervisor: Alice Mohlin

Implications: – This thesis benefits managers by presenting options for companies

Keywords – 5S program, eight wastes, lean, non-value-added activities, pallet handling,

4.2.5 Ways of Handling Packaging Material within the Production Warehouse 27

Appendix 1: Layout map of the production warehouse at Proton Finishing AB in Forsheda.

List of Abbreviations and Acronyms

When implementing a lean mindset, all non-value-added activities should be eliminated,

1.2 Problem Statement

1.3 Purpose and Research Questions

1.4 Scope and Delimitations

1.5 Thesis Outline

Figure 1: An outline of the content of the different chapters in the thesis.

2.1 Pallet Handling within a Production Warehouse

2.1.1 Pallet Movement

Throughout a production line, it is common to dismiss the times a pallet is waiting to be

2.1.2 Pallet Racking

2.4 Lean as a Way of Increasing Efficiency

Figure 2: Steps to implement lean through the five principles of lean.

2.5 The Eight Wastes of Lean

One way to prevent overproduction in a warehouse while decreasing the overall

2.5.3 Unnecessary Transport

Unnecessary transportation is often a result of a poor facility layout, including extended

Overprocessing within a warehouse includes unnecessary or additional quality checks,

2.5.5 Excess Inventory

2.5.6 Unnecessary Movement

2.5.7 Defects and Errors

2.5.8 Unused Talent

organization is considered a waste, along with highly qualified employees performing

2.6 The 5S Program within Lean

3.1 Design of the Study

3.1.1 Case Company: Proton Finishing AB in Forsheda

production companies that require thousands of products to be treated weekly (C.

Figure 3.1: A step-by-step overview of the thesis work process.

3.3 Data Collection

The sample of employees interviewed was an informative decision based on their

Table 3.1: An overview of the interviews conducted for data collection.

1 20/1-2023 Purchase & Logistics Semi-structured Physical meeting in the 70

2 29/3-2023 Site Manager Semi-structured Physical meeting in the 62

3 29/3-2023 Warehouse Worker Semi-structured Physical meeting in the 61

4 29/3-2023 Logistics Manager Semi-structured Physical meeting in the 60

5 31/3-2023 Production Manager Semi-structured Online meeting 28

Table 3.2: An overview of the observations performed for data collection.

20/1-2023 9.30-10.30 60 min Production floor & warehouse

29/3-2023 10.05-10.15 10 min Production floor, forklift aisles & warehouse

29/3-2023 12.55-13.10 15 min Production floor & warehouse

29/3-2023 15.05-15.15 10 min Production floor, truck terminal & warehouse

3.4 Data Analysis

3.5 Data Quality

3.5.1 Internal Validity

3.5.2 External Validity

3.5.4 Ethical Considerations

4.1 Case Company

4.1.1 Problem Statement at the Case Company

4.2 Interview Findings

4.2.1 Ideal Pallet Flow at the Case Company

Step 1: Inbound logistics

Step 2: Registration of incoming material

Step 3: Pallet racking

Step 4: Pallets placed and waiting for production