“They each produce efficiency and quality when used independently, and they complement each other when used together.” There can be exponential savings. However, each technology stands on its own percentage savings,” says Menking.
The benefit of using voice is that operators can work hands-free and does not have to change focus constantly while talking their way through picking tasks. “There is voice verification that the task has been completed, so quality increases,” says Menking. “There is a significant expense involved in rework, so when you minimize errors, you minimize rework expense.”
Another benefit to voice is it simplifies cycle counts, as the operator can do a count and generate a replenishment request as he or she picks an order. AFS uses Vocollect for its software and Psion Teklogix for its handheld devices. Menking says savings could range between 10 percent and 25 percent, and 99.8 percent accuracy is not uncommon. “With the current economic conditions, this is an inexpensive capital investment that has a profound impact on the bottom line.”
Labor management is the process of applying a standard value against each task and having the ability to measure against that standard, explains Menking. “There is an easily achievable reduction of 10 percent in labor costs, with much higher savings possible. Once you start tracking and reporting labor activities, you can manage overall operation costs more effectively.”
A warehouse using neither voice nor labor management can expect combined labor savings of 20 percent to 40 percent when it implements both voice and labor management.
Labor management can be taken to a higher level through engineering the warehouse into X, Y and Z coordinates. “What is happening is you are describing to the application the physical dimensions of the warehouse,” Menking explains. “So for a given task, based on the unit and how far away it is from the operator, the application can automatically calculate how long it should take for the operator to complete the task.”
Menking acknowledges there is a material investment required for this fine-tuned labor management application. “When you are engineering labor standards, there is a lot of planning involved and the precise description of your warehouse is very critical for a successful implementation.”
A common knee-jerk reaction to current economic conditions could lead some companies to want to slice costs, says Schrader at Retalix. In times like these, that additional half point to one point of margin at the retail level becomes more enticing. “Astute market leaders are seizing this opportunity to invest capital to lower operational costs.”
Granos at Infor expects a wave of aggressive WMS replacement.
“Analysts predict this will happen because the systems built in the ’80s and ’90s were customized for the trends during that time,” says Granos. “WMS solutions today have a whole new set of capabilities to handle the requirements of today’s market such as turning inventory more quickly and efficiently while minimizing labor costs.”