London Drugs Cures
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WAREHOUSE AND DC MANAGEMENT ADOPTING VOICE TECHNOLOGY This Canadian retailer tossed its paper-based pick systems and turned to voice to help process SKUs of varying London Drugs shapes and sizes—the result is improved productivity and cures its 99.97 percent order accuracy. BY MAIDA NAPOLITANO, picking ills CONTRIBUTING EDITOR The noisy working environment of London’s 500,000-square- foot Distribution Service Centre G made noise-canceling headset RAPHIC technology essential. C REDIT 48 LOGISTICS MANAGEMENT WWW.LOGISTICSMGMT.COM | January 2011 or every company adding voice Fto its operation for the first time, Bob Heaney, senior research analyst for research firm Aberdeen Group, reports P that there are four to five companies HOTOS already using voice for picking that are BY planning to roll it out to new areas such 2010 V as replenishment and putaway. For voice providers, there’s even bet- OCOLLECT ter news. David Krebs, senior director , I specializing in mobile and wireless for NC VDC Research, sees the voice market Prior to voice picking, pickers used London Drugs implementation timeline to have to wait for the Data Centre to print and manually split thousands Define Adapt Perform Refine of labels into the various pick sections then physically deliver the Week 1-2 Week 3-6 Week 7-9 Week 10 labels to pickers. Now, pickers can Collaborate to Adapt and Train, test, Refine immediately start picking. define a solution prepare that validate and the solution that addresses environment, deploy the maximizing London Drug’s technology solution. the technology specific business and software. investment products, furniture, cosmetics, to com- needs. puters and pharmaceuticals. Though having such an extensive Source: Vitech Business Group product offering may be a panacea to marketing, processing 30,000 SKUs of performing well as we roll into 2011. It’s this quest for increased order varying shapes and sizes could quickly Though he attributes much of this picking accuracy that drove Canadian become a logistical nightmare. How- growth to “pent-up demand among retailer London Drugs from error- ever, London Drugs has clearly stood existing users for upgrades and expan- prone picking with paper to near-per- up to the challenge. sions,” he sees an increasing share of fect picking with voice. In the next Order fulfillment happens very the market driven by opportunities in few pages, we witness this retailer’s quickly. Stores have a cutoff time of emerging and underpenetrated regional successful transition into voice not 7 p.m. to submit their orders. Eleven and country markets, specifically in only to pursue the perfect order, but hours later, these orders are ready to Europe and Asia. also to realize clear savings by elimi- be shipped from the company’s two This expansion into other workflows nating paper labels while improving distribution facilities: a state-of-the- and penetration into global markets is picker productivity. art 500,000 square foot Distribution further testament of voice technology’s Service Centre (DSC) located in Rich- positive impact on warehouse operations NO ORDINARY PHARMACY mond, British Columbia, and a satellite and overall accuracy improvements. London Drugs started out in 1945 as a bulk storage facility, just twenty min- Because of its hands-and-eyes-free oper- 1,000-square foot community drugstore utes away. ation, Krebs points out that picking pro- on Main Street in Vancouver. Today, Lothar Breuers, the DSC’s man- ductivity with voice typically improves this privately-owned Canadian com- ager for systems and training, explains by 20 percent or more. “Order picking pany operates more than 70 retail stores how they get things done: “Although accuracy of well-designed and deployed across Western Canada. And while the the wide range of sizes of products voice solutions typically reaches, if not pharmacy remains at the heart of its does create some challenges for us, exceeds, one error per thousand picks business, its stores offer anything and we like to use different technologies to (99.9 percent accuracy), says Krebs.” everything: from high-end audio/visual help us overcome these issues.” In the January 2011 | WWW.LOGISTICSMGMT.COM LOGISTICS MANAGEMENT 49 Voice Technology piece-pick area where fifty percent of rial costs for peel-and-stick labels had VoiceLink also had more functionality the DSC’s orders are picked, pick-to- been steadily increasing—exceeding when it came to managing users and light (PTL) technology is used to pick $200,000 CAD annually. equipment. “In our operation, visibility fast-movers, while horizontal carou- Why not use more pick-to-light? is the name of the game,” adds the DSC sel systems equipped with light trees Though accurate, management felt manager. “We can’t have pick sections and lighted “pick-to” tables are used that pick-to-light systems were fixed falling behind and holding up a store to pick slower movers. These sophisti- with relatively high start-up costs. Voice deliveries.” With VoiceLink, Breuers cated pick-to-light systems allowed the systems, on the other hand, would be found that supervisors can monitor how DSC to pick their fastest and slower- less expensive and completely portable. work is progressing, moving pickers moving items quickly and accurately. Its hands-free, eyes-free nature allows around to areas that are falling behind However, it was the picking of medium pickers to handle heavy, oversized car- to make sure that each section keeps movers and over-sized, non-conveyable, tons with both hands; and, in the end, up with shipment schedules. pick-to-pallet items that was still a very it was voice that presented London manual, error-prone, pick-with-paper Drugs with a distinct advantage. GETTING A TEAM TOGETHER operation. Management knew changes With management’s approval, London needed to be made. PURSUING VOICE Drugs kicked off its implementation of That same year, Breuers and his team voice technology in February 2007. The STILL PIckING WITH PAPER brought in a demo system from two dif- core implementation team consisted of In 2005, the retailer decided to focus ferent vendors to perform a proof of Breuers; Brian Best, London’s direc- its efforts on improving the accuracy of concept review of the system and to also tor of distribution; Dave Clark, a DSC its paper-based order picking operations compare features between two voice pro- trainer; Mark Murphy, a technical spe- for about 5,000 piece-pick locations. viders. Each vendor’s system was tested cialist; and Les Fraser, the company’s Although picking with paper allowed the for three weeks, and the team compiled senior applications engineer. This core company to achieve impressive produc- productivity and accuracy statistics and team also invited a group of pickers to tivity metrics, management recognized built an ROI case for voice. help smooth out the processes. room for improvement on other critical From the outset, it was clear that the Vocollect suggested that the team service levels—specifically accuracy. characteristics of the facility played a work with one of its value-added resell- Their error rate with paper was about role in making the decision. “We have ers, a Washington-based company called one in every 300 picks (a 99.6 percent a fairly noisy working environment Vitech Business Group, who had exten- accuracy rating), but they knew that because we have a lot of conveyors sive expertise in warehousing operations. they could do better. “Pick errors can running through our facility. We found “Vitech really understood our operation be costly to correct,” explains Breuers, Vocollect’s noise-canceling technology and individual workflows and was able “but more importantly, they can turn on its headset was better able to handle to configure the software to match our into real customer service issues at our our background noise.” particular operational needs,” recalls retail stores.” In addition, the mate- The team concluded that Vocollect’s Breuers. “One thing I never like is an integrator that wants me to change my operation to fit the way the software works.” One of Vitech’s principals, Richard Stewart, says that the knowledge trans- fer was the key to the collaboration. “You can gauge the success of a project if, at the end, the customer knows our technology as well as we do—and we know their operation as well as they do.” GEARING UP FOR VOICE With a team in place, the first step was Ideally, heavy items should be to ensure that the proper infrastructure slotted towards the beginning was in place to fully support voice tech- of the pick path to ensure nology. RF networks were upgraded and a stable base for a pallet. wireless coverage verified in both facili- Because of the wide variety ties. Interfaces were developed to con- of products, the system had nect voice to the company’s homegrown to be configured to allow an AS400-based warehouse management operator to skip ahead to system (WMS). Check digit labels were build that perfect pallet. applied to pick locations, while work- flows were reviewed to ensure that the software could be configured to match 50 LOGISTICS MANAGEMENT WWW.LOGISTICSMGMT.COM | January 2011 Voice Technology Voice Compared to Paper/Labels Paper Read next Travel to Verify location: Remove Pick Read next and Labels location location • Read label or list label or and stick location • Compare with locate or check actual location pencil off list Periodically during a shift: • Travel to assignment point Hear next location; Travel • Speak check digits Hear next • Sort/get labels or find list Voice (eyes up and hands free) • Hear instructions location; • Travel to desk to reconcile discrepancies • Perform task Travel Travel to next location • Data entry (if required) ...all are eliminated with voice Elapsed Time Voice Advantage Extreme Accuracy Productivity Training Reduce errors by 85% vs.