New England Biolabs: Transition to Production Logistics of the Future

With the move to the new production building, storage locations, material flows, and employee travel times have changed. This has prompted NEB not only to adapt existing SAP workflows in SAP S/4HANA, but to strategically optimize processes to increase efficiency and minimize errors.

A key focus of the project was internal logistics. Previously, employees had to search for materials needed for production or research directly on the warehouse shelves, because SAP did not know the exact storage bin. In a multi-story warehouse of this size, the long walking distances cost valuable time every day. In addition, materials removed from storage were not recorded in SAP at the point of use, which made end-to-end tracking difficult.

There was also significant potential to enhance shipping processes, as digital structuring offered opportunities for greater efficiency and accuracy.

Going forward, domestic deliveries were to be reliably shipped on the same day, and the rate of complaints due to incorrect product shipments reduced to near zero.

After extensive consultations with consolut, NEB decided to fundamentally redesign internal logistics and shipping processes. Media discontinuities were eliminated, and manual workflows were replaced by digital end-to-end processes based on SAP EWM (Extended Warehouse Management) in SAP S/4HANA. 

Internal Logistics 

At the heart of the new internal logistics setup, NEB installed four Kardex Vertical Lift Machines in the centre of the production hall. They connect all floors of the warehouse and eliminate the need for walking long distances. Storage and retrieval are now handled by trained staff members who operate the Kardex machines. This reduces the risk of errors and speeds up processes through specialization. 

Employees receive requests from operating departments via SAP EWM directly on their mobile scanning devices. Using SAP standard tools (Service EWM_MOBGUI), custom scanner transactions were developed that also communicate with the Kardex lift machines. With just a few clicks, material can be requested, and hand-over and reception be recorded — without excessive walking, without long searches. 

Materials are stored at minus 20 degrees Celsius, and the hallway is also cooled down to four degrees Celsius. To prevent long wait times in the cold, SAP EWM allocates storage and retrieval tasks across all four lifts so that multiple items can be requested or returned simultaneously.  

Shipping 

In shipping, NEB has fully digitized its workflows: no product moves without being scanned, ensuring complete traceability of inventory and movements — down to storage-bin level. Misplacements and picking errors are prevented, while creating the foundation for further automation, such as automated replenishment runs. 

To increase process efficiency, consolut combined multi-order picking with system-driven workflow optimization: instead of picking products individually for each customer order, employees now pick multiple items in a single run. SAP EWM also determines the optimal shipping carton and calculates the ideal walking path through the warehouse, guiding employees step-by-step through the entire process.  

Both the internal logistics and shipping process enhancements have delivered tangible improvements with a clear economic impact for NEB. 

Internal Logistics 

The new process architecture has reduced the time required to request or hand over a material to a fraction of the previous duration — largely because SAP EWM automatically calculates which lift provides the shortest storage or retrieval time. Each movement now takes only a few seconds. 

Storage space requirements have been reduced fivefold thanks to the new storage methodology. Gas and electricity consumption has also decreased by about 23 percent per square meter, according to NEB estimates, due to the new, energy-efficient systems. 

At the same time, employee comfort has improved. With digital process guidance on their tablets, employees always have an overview of upcoming tasks and are more efficient. Correction runs due to incorrect materials have been completely eliminated. 

Shipping 

Digital process control reduced packaging errors by a factor of 1.5 and eliminated replacement shipments. Picking is significantly faster because employees work on orders via a central dashboard, distribute workload within the team more efficiently, and complete more tasks per hour. Domestic deliveries can now reliably be shipped same-day. 

The most striking effect is the efficiency gain: NEB reduced shipping staff by 20 percent and redeployed these employees to other internal tasks. 

The soft launch of the new systems and processes simplified the transition for employees and shortened the changeover period. Within just a few months, the new workflows have become routine and begun yielding measurable improvements, ensuring that the modernization has been fully paid off.