Voice Enabled Warehouse Process and Return on Investment

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Voice Enabled Warehouse Process and Return on Investment

Applies to:

SAP Logistics Execution – Warehouse Management with the platform SAP ECC 6.0

Summary

Voice, also referred to as Speech, control provides a natural user interaction with the Warehouse

Management system, removing the need to focus on a data terminal or paper and liberating the

operator’s eyes and hands to do their jobs far more effectively. Voice directed operations, such as picking and put-away, show substantial improvements in accuracy and efficiency, giving proven

short Return on Investment periods

The main purpose of this article is to illustrate its know-how of using Voice Enabled Warehouse processes within WMS. It’s ROI and Expected ROI

Author(s):      Tushar G. Korde

Company:      Accenture Services Pvt Ltd

Created on:    9th April 2012

Author Bio

I am Tushar Korde and have around fourteen years of total experience in Supply Chain Management including more than five and half years in SAP. Being a SAP LE-WM consultant I have worked on multiple SAP projects including Implementation, Roll-Outs and Supports projects both at SAP MM and WM level. The industries I served are Glass fiber, Automobile, Chemical, Project-based industry, Consumer Goods and Services, Energy.

Table of Contents

Overview  

Voice Picking Introduction

Voice enabled process for SAP WM.

            Voice Put-away

            Voice Picking

            Voice Transfers

Voice Picking Accuracy

            Wholesaler:

            Retailer

Voice Landscape and Hardware

Return on Investment

            Voice Picking Productivity

            Administration Productivity

            Savings in Stationery Costs.

            Real Time Stock Updating

            Improved Safety

            Reduced Training

Expected Return on Investment (ROI)

Related Content

Overview

Voice control provides a natural user interaction with the warehouse Management system, removing the need to focus on a data terminal or paper and liberating the Operator’s eyes and hands to do their jobs far more effectively. Voice directed operations, such as Picking and put-away, show substantial improvements in accuracy and efficiency, giving proven Short Return on Investment periods

Voice Picking Introduction

Voice Picking is an extension of the Warehouse Management system through additional software and hardware that allow the transfer instructions to the warehouse operators by means of a headset with earphones and microphone (headset). Voice Picking involves the use of a wearable computer with a headset and microphone so that the order pickers are instructed by voice on what items to pick and where to pick them, verbally confirming their actions back to the warehouse management system (WMS).

The operators confirm the execution of tasks by voice. The microphone of the headsets transmit operators confirmations to the WM system in real time.

The instructions transmitted through the headphones replace paper printing tasks as well as replace the use of mobile radio frequency as the instructions given in the headband provide all the information needed to execute the tasks like:

Voice Picking systems also enable the handling of exceptions during the execution of tasks, such as product shortages, empty locations, move to next task without running the current one, and so on.

Voice enabled process for SAP WM

The following voice enabled processes for SAP Warehouse Management:

·         Put-away

·         Picking

·         Transfers

The transactions integrate into SAP Warehouse Management mobile data entry utilizing standard SAP configuration, processes and reporting

            Voice Put-away

The voice put-away transaction supports execution of put-away transfer orders, including support for optimized multi-item put away where materials are removed from the trolley/pallet and placed into the destination bin(s).

            Following is an outline of the voice put-away steps:

·         Operator announces the transfer order/trolley/pallet number to initiate put-away

·         System voice output of the destination bin

·         Operator verbally confirms the bin check digit to verify location

·         System voice output of material/batch/quantity to put-away

·         Operator verbally confirms the quantity

  ·         Continue through all items

            Voice Picking

The voice picking transaction supports picking of either single or grouped transfer orders, optimized for pick to trolley or tote processes, where materials are removed from the source bin and placed onto a picker’s trolley or tote.

Following is an outline of the voice picking steps:

·         Operator announces the picking group/transfer order or the system provides next pick in queue

·         System voice output of source bin

·         Operator verbally confirms the bin check digit to verify location

·         System voice output of quantity to pick

·         Operator verbally confirms the picked quantity

·         System checks the quantity is okay

·         System voice output of position on trolley

·         Operator verbally confirms confirmation of placement on the trolley

In addition

·         Support of pick-by-delivery

·         Enables efficient pick-by-material for multiple deliveries in a group without the need to implement SAP 2-step picking process

·         Voice error message handling

·         Voice handling of picking with differences

            Voice Transfers

The voice transfer transaction supports execution of transfer orders for replenishment or other internal movements. Both user initiated and system guided operation is supported. The following is an outline of the voice transfer steps:

·         Operator announces the transfer order or System provides next transfer order in queue

·         System voice output of the source bin

·         Operator verbally confirms the bin check digit to verify location

·         System voice output of material/batch/quantity to transfer

·         Operator verbally confirms the quantity

·         System voice output of the destination bin

·         Operator verbally confirms the bin check digit to verify location

·         System voice output of quantity to pick

·         Operator verbally confirms the picked quantity

Voice Picking Accuracy

The biggest cost benefit is increased picking accuracy, and this is frequently used on its own to cost justify the adoption of voice technology.  However, the cost of a picking error is frequently underestimated, and of course differs for wholesalers and for retailers distributing to their own stores.  The cost of a picking error also differs for short picks, over picks and miss-picks.

            Wholesaler:

Short pick: The costs are the clerical effort of handling the credit claim and the margin on the lost sale.

Over pick: If reported, the costs are the transport costs of returning the item, labor costs in handling the return, and in some cases the cost of writing off stock if outside acceptable shelf life or QA parameters.

            If not reported, the cost is the stock loss incurred, perhaps an average of £10 ($15) per case.

Miss-pick: If the error is correctly identified and reported, the costs are the clerical effort of handling the credit claim, the margin on the lost sale, the transport costs of returning the item, the labor costs in handling the return, and in some cases the cost of writing off stock if the returned item is outside acceptable shelf life or QA parameters.

The average cost per picking error for most wholesalers is in the range of £5 to £25 ($8 to $40) per error, with £5 ($8) being a significant underestimate in most cases.

            Retailer:

Short pick: The costs are the clerical effort of recording an adjustment in the stock and accounts system and the margin on the lost retail sales if the short delivery results in a stock out in the store (typically 20% of short picks might result in stock outs)

Over pick: The costs are the clerical effort of recording an adjustment in the stock and accounts system, and if the overstocking is great enough to justify a return, the transport costs of returning the item and the labor costs in handling the return.  The overstock situation may in some cases result in writing off short shelf life stock.

Miss-pick: The costs are the clerical effort of recording an adjustment in the stock and accounts system, and the margin on the lost retail sales if the short delivery results in a stock out in the store.  If the overstocking of the incorrect item is great enough to justify a return, the costs include the transport costs of returning the item, the labor costs in handling the return.  The overstock situation of the incorrect item may in some cases result in writing off short shelf life stock.

The reduction in picking errors resulting from voice picking can vary considerably (in some warehouse environments 99.9% accuracy is exceptionally good, while in others it is exceptionally bad!), but some recorded examples are error rates of:

·         3 per thousand reducing to 0.3 per thousand (accuracy of 99.7% improving to 99.97%)

·         8 per thousand reducing to 1 per thousand (accuracy of 99.2% improving to 99.9%)

·         1.1 per thousand reducing to 0.1 per thousand (accuracy of 99.89% improving to 99.99%).

These represent reductions in picking errors of between 80% and 90%.

As an indication of the magnitude of the possible savings, a wholesaler picking 500,000 cases per week with an error rate of 2 per thousand (99.8% accuracy) is experiencing 50,000 errors per year.  An 80% reduction to 0.4 per thousand (99.96% accuracy) will reduce errors by 40,000 per year, which at a cost of £10 ($15) per error represents savings of £400,000 ($600,000) per year.

Voice Landscape and Hardware

The voice enabled devices communicate directly over the RF network to either SAP (with ITS Mobile) or the Web-enabled SAPConsole server. In addition, an FTP server enables simple, easy and consistent software or configuration updates directly to each device.

The topSPEECH-Lydia® Connector for SAP runs on the voice device and provides the voice presentation to the operator and the interpretation of spoken responses back from the operator.

·         Speech recognition supports over 25 languages

·         Speaker independent, alleviating the need for voice training

·         Speaker dependent support if required

·         Centralized fine tuning of phonetics

·         Reduced training times from three levels of spoken detail

·         Ease of use with true spoken voice (not synthesized)

·         Supports Text-to-Speech conversion e.g. material descriptions

·         Voice only or multi-modal (Voice + scanning + screen in/output)

Return on Investment

The biggest benefits and best return on investment are obtained in low margin, high volume, labour intensive case picking warehouse operations. Accuracy and productivity are critical in these low margins, labor intensive operations, and the use of voice technology delivers this by freeing both the hands and the eyes for the picking task. 

The hands free operation is also particularly suitable for picking Frozen Foods and Chilled Foods, where gloves hamper the handling of paper or radio data terminals. Catch weights are easily captured, and the subsequent re-keying of information into the WMS is removed

The list of potential benefits from voice picking is impressive:

·         Increased accuracy 99.9% 

·         Increased productivity 15% 

·         Removes trips back to assignment desk

·         Removes cost of printing and distributing picking documents

·         Removes cost of re-keying order amendments, picking confirmations and catch weights

·         Hands free & Eyes free makes picking easier

·         Real-time feedback for proactive warehouse management

·         Real time stock updating

·         Improved safety – hands free & eyes free

·         Reduced training – verbal prompts easier

            Voice Picking Productivity

            Typical productivity improvements are between 10 and 20%, arising from:

·         Hands free – no paper or bar code scanner to handle.  The benefit is even greater for frozen and chilled foods.

·         Eyes free – no stopping to read picking instructions, pickers listen & speak while moving.

·         No return to assignment desk to collect next picking list.

·         Voice directives pushes pickers harder – workers respond well to verbal instructions.

·         Faster recording of catch weights – spoken rather than written or keyed.  The benefit is even greater for frozen and chilled foods.

·         Fewer re-picks due to fewer empty picking slots because real time stock updating triggers replenishment instructions

As an indication of the magnitude of the possible savings, a distribution centre employing 50 pickers might have a total labor cost of £1 million, and maybe significantly more if overtime payments are substantial.  A 15% saving on £1 million is £150,000 ($240,000) per year.

            Administration Productivity

            Improvements in administrative efficiency arise from:

·         Elimination of the tasks of printing and distributing picking documents

·         Elimination the re-keying of picking confirmations, order adjustments for out of stocks, and catch weights for variable weight items.

These cost savings are significant, and for a large wholesaler there may be several administrative staff no longer needed for those tasks.

            Savings in Stationery Costs

Eliminating paper picking labels brings a significant cost saving in the cost of the paper alone.  Many distribution centers spend in excess of £50,000 ($75,000) per year on purchasing picking labels.

            Real Time Stock Updating

            Real time stock updating allows:

·     Triggering of letdowns to replenish picking faces, optimizing the use of fork lift trucks and preventing re-picks or waiting time due to empty picking faces

·     Immediate action to be taken on stock discrepancies if picking face is empty or from cycle counting, allowing picking face replenishment to take place and improving accuracy of stock recording.

·     In turn, the improved accuracy of stock recording leads to improved service level and less time spent investigating stock discrepancies

            Improved Safety

            The hands free and eyes free operation leads to fewer accidents in the warehouse.

Eliminating paper leads to less waste paper or label backing sheets, resulting in a cleaner, tidier and safer warehouse.

            Reduced Training

The training time for new order pickers is reduced by the use of voice, as a voice directed task is easier to learn than interpreting a paper task.  Training time can often be reduced by as much as half.

Expected Return on Investment (ROI)

The expected ROI from voice directed order picking will, of course, vary significantly from one company to another, depending on:

·         The current level of picking accuracy and the potential for improvement

·         The current method of picking – paper based or radio data terminal

·         Whether orders are checked before dispatch

·         How many picking shifts are in operation

·         What infrastructure is already in place e.g. RF Network

·         Whether the existing Warehouse Management software (if any) supports voice technology

One of the biggest factors is the number of picking shifts in operation.  If there is more than one picking shift per day, then equipment can be shared between pickers on different shifts.  Typically each picker would have their own headset (and microphone), but would share the wearable computer or terminal, as their voice profile can be downloaded to the terminal when they log on.  For a warehouse with more than one picking shift moving from paper based picking to voice directed picking, the cost of installing voice technology is now such that payback can often be achieved within 6 months.  For a warehouse with a single picking shift per day, payback within one year would be a more realistic target.

Related Content

http://voicepicking.com

http://www.logisticsit.com

http://sdn.sap.com