October 25, 2016
As a leading third-party logistics provider, accuracy is paramount for Merrill Corp., especially since its customers are held to strict regulatory standards to maintain privacy and confidentiality.
However, due to a rise in clients (approximately 30) and SKUs (17,000), Merrill encountered increasing difficulty as it attempted to maintain order accuracy while using its legacy paper-based system.
Merrill sought a more reliable, automated method to ensure order fulfillment accuracy and increase throughput: a voice picking solution.
The flexible solution offered Merrill an economical solution, with hardware alone costing 80% less than suppliers that require proprietary hardware and operating systems.
The ROI of voice picking
Picking is the most labor-intensive operation within the warehouse, making it one of the most popular supply chain processes to improve with voice technology. Much of the impact to the business comes from four key criteria:
- Reduced operational costs
- Increase workforce productivity
- Improved customer satisfaction
- Enhanced operational agility
The majority of benefits for using voice-directed solutions in picking operations come from the hands-free, eyes-up nature of voice technology.
Download: The Return-on-Investment of Voice Picking
Furthermore, the voice picking solution capitalizes on the experience level of Merrill employees. For the less-experienced operator, the system forces a quality check on each piece, requiring them to verify their presence in the correct location before receiving pick instructions. For expert workers, supervisors can set the system to require fewer validation steps and enable more advanced functionality, like combining multiple pieces of data into a single voice response.
Merrill’s workforce quickly adapted to the solution, particularly the younger employees who were excited to test out the new technology. Once familiar with the system, employees quickly developed a healthy competition to post the best accuracy and productivity statistics.
“What this means is that we can get employees up and running, and fully competent in less than one day, freeing up resources and significantly reducing the investment in training,” says Murray Muff, warehouse manager at Merrill.
Since installing the solution, Mike Zimny, director of operations for Merrill, has found that staffing requirements in areas equipped with the technology have been greatly reduced, primarily due to increased productivity.
“We were able to reduce staffing in those areas by almost 50%,” says Zimny. “Combined with the nearly 45% increase in productivity, we experienced a net production benefit of almost 100%.”
In addition to employee satisfaction and reduced staffing, Merrill’s adoption of the voice picking solution reduced errors by 65%, resulting in a rise in accuracy—Merrill’s most important parameter of quality—from 99.73 to 99.9%.
At the same time, Merrill has also increased throughput by 45%, while providing management with a view of employee productivity. Due to these positive implications, Merrill has also expanded its usage of the solution into additional workflows.
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The Return-on-Investment of Voice Picking
To produce a solid business case - replete with ROI, internal rate of return, payback period, net present value and similar metrics - one must first quantify the financial benefits that reduce existing hard-dollar costs in labor, operating expenses, materials, inventory and fixed assets. Download Now!