The Digitized Logistics of S.E.G.A. Hungary Kft. Has Halved Production-Delivery Lead Time

Starters E-Components Generators Automotive Hungary Kft.’s innovative intralogistics solution based on real-time positioning and voice-based picking has halved production-delivery lead time while making goods movement accounting almost 100 percent accurate.

SEG Automotive, a manufacturer of starter motors and generators, was founded in 2018 following the divestment of Bosch’s SG division. At the site of the company, which employs 7,000 people from 14 countries, in northern Hungary, the biggest challenge was the bridging of the 2.5 km distance between the factory and the raw material and finished goods warehouse. 5 trucks were operating between the two sites for an uninterrupted supply of material to the production lines, but this process was extremely time-consuming and costly, and the administrative work involved a lot of resources while carrying many risks of failure.

As a result, S.E.G.A. Hungary was looking for an innovative solution based on advanced technology, which supported automated material flow processes from the background by rethinking or replacing traditional data entry tasks, methods, and tools.

Technologies such as the RTLS indoor real-time locating system and the Pick by Voice voice-based warehouse picking system, which were still rare in Hungary in 2018, could be considered for implementation. Building on them, S.E.G.A. Hungary has raised its intralogistics system to an outstanding level, with which it now successfully responds to the challenge of efficient and reliable material movement.

Digitized Intralogistics

Ordering of the raw materials starts both physically and logically from the production line. The internal order, the so-called Shopping List is sent to the Pick by Voice automated voice-based warehouse picking system, which guides the picking colleagues to the storage of the listed raw materials in an optimal route. During picking the system also uses automated voice prompts to help employees, who prepare the raw materials on movable shelves.

Movable shelves are given a tag with a unique identifier, also known as an RTLS tag, that allows the indoor real-time positioning system to determine, with an accuracy of 30 centimeters, where a shelf is located in the warehouse or the factory at a given moment. The implemented solution links the prepared raw materials to the shelves with RTLS tags. The picking staff then take the already prepared shelves to the finishing area, from which the materials are loaded into the trucks.

At the same time, a virtual delivery note is created – the raw materials prepared on the shelves are automatically recorded on the virtual delivery note when they pass through the virtual zones designated in the RTLS system. After a two-and-a-half-kilometer truck journey, the raw materials arrive at the factory, where they are received by the RTLS system in the same automatic manner. The shelves unloaded from the trucks are then taken to the FIFO routes, from where they are transported to the production lines. Going through the virtual zones, the RTLS system again automatically tracks and records the raw materials in the enterprise ERP, which employees can check on the factory displays.

A Quick Return on Investment

The innovative solution built from S.E.G.A. Hungary’s systems and the systems supplied by IBCS Hungary resulted in a much more efficient and accurate logistics process. By reducing the number of traditional logistics steps with digitalization, for example, the manufacturing company achieved 15% saving in the LOG HC that it could reallocate to other tasks. And the turnaround time for the delivery was reduced from the previous 6 hours to 3 hours, while the accounting automatically became more accurate. The implementation of the intralogistics solution, which was performed in just 4 months, thus also paid off quickly, in 2 years, and according to Imola Osváth, a project coordinator at S.E.G.A. Hungary Kft., it showed how the efficiency of enterprise logistics can be improved in the future.

‘My team and I are most proud that we have taken the first steps towards digitalization using these new technologies,’ said István Kovács, a logistics manager at S.E.G.A. Hungary Kft