Order picking for an omni-channel operation adds a whole new level of complexity to the process with the need to pick in quantities for store deliveries as well as picking individual items for home delivery. Lisa Townshend investigates the options.
Board rooms, businesses and brands are beginning to recognise that direct channels require more prioritisation of stock, and more speed and flexibility than traditional store replenishment – the impact of a failed delivery to an internet customer is much worse than an unfilled shelf in a store. In an omni-channel world, there is a need for speed, quality and consistency in order picking and any fall down in the process can cause unacceptable delays.
One of the biggest trends in order picking for omni-channel is the fragmented way in which orders are now received and processed. Jonathan Pilbro, VP fashion at DHL Supply Chain, explains: “We probably spent the last 10-15 years picking in bulk as infrequently as possible, trying to drive efficiency. The consumer driven need nowadays is at an order level, a single item, and order assembly – you are taking multiple single orders to put together as a package. Whether that’s a parcel for a home or whether that’s a consignment going into store or even in a display going into store, the challenge is to be more manufacturing minded in our processes and less bulk.”
Rob Hodgson, divisional leader supply chain at Access Group, sees delivery choice as another vital trend. “Consumers expect total availability and same or next-day delivery to the location of their choice – regardless of whether this is really needed. Business customers are following suit as they see the possibility of freeing themselves from minimum order quantities and back rooms full of inventory. One hundred per cent accurate and timely fulfilment is required.
“In addition, customers expect the same range, price and availability regardless of what combination of web-based and traditional techniques they use (pure e-tail, click and collect, buy in-store for home delivery and so on). Separate or restricted product ranges and differential pricing for e-commerce are no longer acceptable, and the supply chain has to serve not just a multi-channel but an omni-channel world.”
Gavin Clark, commercial director at Snapfulfil agrees. “Click and collect and same day deliveries are in the news as the key trends for the major retailers this Christmas – to compete, smaller retailers are having to invest in technology to help level the playing field. Multi-order picking and ‘fast pick’ zones are really helping our customers to deliver higher levels of service than before.”
The varieties in warehouse order picking methods are as wide as the sectors they serve. Traditionally this is done manually with operators walking a predetermined ‘pick round’ – known as ‘person-to-goods’.
Martin Brickell, e-commerce sector lead and director at Total Logistics says: “Typically there is no ‘one size fits all’ solution, however businesses with awareness of which picking methods fit best with which range profiles are more likely to succeed. Getting to this understanding requires good integrated systems (from web front end to warehouse processing) and well understood operational processes that are aligned to the proposition.”
A step up from person-to-goods is an automated solution with the ability to bring products to the operator at a goods-to-person pick station. Once at the station there are options for completing the order picking, ie batch picking – where a product is accessed once for many orders and sent via a sorter to a unique chute for each order, then packed; order picking – where all different products in an order are picked/packed in one place; wave picking – where a group of orders are picked together into a transit tote, and relocated for packing.
Noel Blake of TGW is clear that omni-channel is well suited to this system: “Omni-channel is driving the preference towards goods-to-person picking. Today this is primarily completed with an operator at the actual point of picking, but goods-to-robot picking is not far away. This is an area that TGW is actively engaged in.”
Darrel Williams, Honeywell’s region director, Northern EMEA, Vocollect Solutions, sees person-to-goods integrated with more modern technology as the way forward: “Paper and scanning-based picking are still common however the industry has realised that there is a better way, resulting in a sharp increase in the level of adoption of voice picking. The agility that voice delivers makes it the most suitable enabler for the constant SKU churn and fluctuations in demand that epitomise today’s e-commerce and omni-channel business. Voice empowers users from any background to produce unrivalled performance in terms of accuracy and efficiency; ensuring companies deliver the level of service its customers have come to expect. Add to that benefits such as decreased training times and lower staff attrition and it’s obvious how it can help operations directors manage the challenges of today’s omni-channel world.
Although voice picking is the relative newbie when looking at order picking technology, vision picking is fast looming on the horizon as a sophisticated but user-friendly way to improve efficiencies in the omni-channel process. Jan Junker, CEO of Ubimax explains: “Pick-by-vision is a solution making use of computing hardware such as smart glasses.
“We can display the information needed for the picker – ie location, product information – and the smart glasses have a camera integrated. Then we can use that camera for barcode scanning. So basically you can take the item, look at it and as the camera is in front of your eyes it scans the barcode and confirms it is the right or wrong item. One of the biggest benefits to the pick-by-vision system is you can have both hands free to pick the item, hold it and scan the barcode.”
However, pick-to vision is still viewed with some scepticism by others in the industry. Rob Hodgson says: “Pick-to-vision is still very much prototype but like pick-to-light, will likely become mainstream as costs reduce and the early adopters have proven it can add benefit.”
Noel Blake agrees. “Technology such as ‘Google Glass’ and/or ‘head up display’ has, so far, failed to make a breakthrough. However, pick-by-light and light directed picking from a multi compartment tote are now widely accepted. These all provide high speed and increased accuracy, which is essential in e-commerce as consumers don’t give retailers a second chance.
Knapp has a different view on vision technology. “There have been some interesting developments in partnership with customers in this area,” says Craig Rollason, Knapp’s managing director. “We have developed Vision Desk, which is used either for quality checking or to separate out a batch pick. The system comprises a glass table equipped with a series of cameras and overhead lighting. In the quality check process, the system verifies all the items by reading their barcodes and lights up any erroneous items and advises of any missing items. The first of these Vision Desks has been sold to a leading jewellery manufacturer for quality checking.”
Junker agrees that for many the technology is not mature enough for general adoption. “The longest time that a customer has been using it in full production is roughly four months; although some are using it almost continually across three shifts. But even fast followers require at least one year of production picking at a scale of 10-50 order pickers before they feel the technology is mature enough before they will consider adopting these solutions. So, what we’re missing at the moment is time – I would say that is the biggest obstacle to adoption.”
If pick-to-vision and similar technology wasn’t sci-fi enough, there is the concept of automating the process and how far companies can integrate automating order picking for omni-channel into their systems.
Rob Hodgson can see the benefits: “If the value of goods will support it, a solution both to the space problem and to the need for speed and accuracy will lie in a greater degree of automation. Carousels and other storage systems can use the full height of a building. Automated storage systems themselves run a form of warehouse management, and it is important that these integrate with the overall warehouse system. Technological aids to picking efficiency and accuracy, based on voice, light or other technologies, also require seamless integration. It is possible to create automated systems with a degree of flexibility in their layout, and it is likely that the warehouse system will work periodically with simulation systems to verify the optimum layouts for both automated and manual processes.”
Darrel Williams is more cautious. “Automation brings about several benefits and it is understandable that many companies explore this route. It is a great system for companies who can foresee the path of their customer demand for the next 5-10 years, which is the typical amount of time required for return on investment of such a system. It may also be a decent fit for companies who experience a regular flow of business throughout the year; that is, with no peaks in customer demand. However this is rarely the case. Who could have predicted the evolution of online business into the multi-channel and now omni-channel that we are witnessing today even five years ago, let alone 10? Should companies invest in automation for their busiest time year, and suffer system redundancy and overcapacity in quieter periods? For this reason a more adaptable system is needed. Such flexibility is typically not offered through automation.”
Jonathan Pilbro believes that the level of automation a company requires depends on their proposition. “We are working with many customers that are at different points on the automation journey. Some have gone to a fully automated solution and some are making tactical steps towards that. It really does depend on your current infrastructure and legacy systems and your value proposition – where are you going to differentiate yourself in the market.
“Automated packing or bagging is a definite area of interest; shorter payback, less risky implementation that has significant economic benefits and accuracy benefits. Selected automation at certain parts of the process is definitely happening – there are some moving toward full automation and as time goes on the cost tradeoff between investment in automation and full labour costs gets closer.”
Gavin Clark adds: “There’s a lot of research going on regarding automation for warehouse picking, with Amazon/Kiva and many others showing great innovation in this area. The most recent research I’ve seen from two professors at MIT (Andrew McAfee and Erik Brynjolfsso) has shown that the greatest advances in efficiency are when humans and robots are combined to make the most of their particular strengths – eg pattern identification and handling vs tireless yet programmable action – this has been the case with goods to man and AS/RS type operations for many years. I can’t envisage a time when people are not required in the warehouse at all, but using computers and machines to make the job easier and quicker is certainly the future.”
“Yes – at least, automating those parts of the process that are cost-effective to automate,” believes Craig Rollason. “Of course, with advances in technology, the tipping point in favour of automating any particular task is moving all the time. In addition, we are trying to think outside of the box to find more radical approaches to intralogistics – as opposed to incremental improvements to technologies.”
Of course, order picking is not all about who is doing it and how – it is also where. Layout is critical for efficiency, both in terms of pick speed and ergonomics. Andy Robson, supply chain solutions manager at GS1 highlights this concept: “Pick-to-belt and pick-by-light automation systems are being designed to optimise the efficiency of the operator and the ergonomics of the workstation. A greater use of automation for storage and retrieval systems (AR/RS), particularly in ‘high bay’ warehouses, enables greater flexibility in the way stock is stored. The underlying IT systems ensure a dynamic allocation of where the stock is located, which is more space-efficient than traditional warehouse layouts.”
“The best and most efficient way to ensure optimal layout is to have a new build, but this often isn’t possible. We have many examples of a new automated solution being installed into an existing warehouse. This introduces a goods-to-person solution to compliment what is already in place,” says Brian Whale, senior logistics consultant at Swisslog.
Martin Brickell believes the wider picture should be the consideration: “A holistic approach is key to ensuring space, equipment and operating methods are well integrated. Consideration should be given to all operational processes, including how much space and resources they require, what limitations they have and the level of flexibility they can accommodate. Walk distances, lifting, handling and moving products all require space and resources – not just in picking but also for packing, stacking and loading – which good design assessment can optimise.”
Edward Hutchison, MD of Bito Storage Systems says: “Another consequence of the growth in omni-channel retail is a growing demand for fit for purpose warehouses, distribution, and fulfilment centres, which are in short supply in the areas they are needed– particularly the ‘mid-size’ boxes (50,000-100,000 sq ft) that are popular for fulfilment centres serving local areas around urban areas where more people are now living for fast deliveries. There is also a dearth of supply of new larger warehouses for regional or national distribution centres suitable for today’s omni-channel operations.
“One of the best ways to avoid finding a new property is to make better use of existing space and introduce dense storage systems and order picking solutions that ensure rapid fulfilment.
One of the themes discussed at the recent Omni-Channel Conference was the question of a single or separate stockpile for omni-channel and which would be the best in terms of efficient order fulfilment. Although the general consensus was that single was best, it was more complex than that.
Edward Hutchison firmly believes that “a single pool of stock within an omni-channel fulfilment facility will generally serve all channels, managed by sophisticated warehouse systems.
“The physical storage complexities in combining the differing needs of the different channels in terms of speeds and order quantities can lead to a great deal of specialty around picking operations. A facility will need to accommodate picking pallet and case loads as well as large numbers of single items– some of which may go direct to a customers’ home, others will go to the store for click and collect – along with replenishment stock.”
Rob Hodgson felt the question itself led to even more questions. “As I mentioned earlier, separate or restricted product ranges and differential pricing for e-commerce are no longer acceptable, and the supply chain has to serve not just multi-channel but an omni-channel world. These factors mean some difficult decisions on warehouse location and distribution architecture. How close to the end user to hold finished goods inventory? To what extent should postponement of final assembly or customisation be used, and where should it be carried out? Can e-fulfilment, picking and packing, be successfully performed alongside traditional bulk supply activities? Whatever the physical architecture, can the systems, and the transport network, treat stock in any location from manufacturer’s warehouse to high street store shelf as part of a single inventory serving all channels? Orders should have the ability to arrive from multiple sources but reflect a single source of stock.”
Andy Robson says: “In a perfect world, omni-channel would enable: ‘Any product being supplied from anywhere to anywhere’. This requires a ‘single view of stock’ across the supply chain, as well as within facilities. The ‘best practice’ warehouse will service both B2B (store delivery) and B2C (consumer delivery) from the same common stock pool but may have separate IT systems that drive the process for bulk picking and item picking.”
Noel Blake adds: “Today, many retailers are delivering every day to stores as part of their click & collect fulfilment offering. ‘Normal’ replenishment stock has become very few items per order line and therefore much more like an omni-channel order. So the industry appears to be moving towards one common stock, which reduces inventory and improves stock visibility.”
There is no doubt that for the sector it is an exciting time. The omni-channel space has meant that logistics has become much more ‘front of house’ – a part of the proposition from the seller to its customer base. There is much to consider in the order picking process to ensure that delivery is seen as a part of the experience, and logistics managers must ensure their voices are heard.