elog Worldwide Inc- middleastlogistics.com-BUSINESS LEADS, NEWS & FEATURES FROM THE MIDDLE EAST

Achievement of customer satisfaction is the key objective of a distribution system and indeed of the total supply chain. Understanding how to identify actual and real customer needs and to translate this information into deliverable service is critical to logistics success of any organization.

Order picking is a critical customer service tool, which, if done well, will enhance the company’s customer service standards and if badly executed, will have the opposite effect.

Quality in order picking means the elimination of errors and the aim in an efficient operation should be to achieve a 100% accuracy. To plan for anything less is to accept incorrect customer orders, lost sales, lost customers and lost profit.

Improving Order Picking Accuracy

How often does warehousing operations measure their actual error rate? The response to this would be very much on the lower side. Knowing where your errors are occurring and to be aware of the real cost of an error and the impact this will have on your service level goals are very important. An error may be very small in itself but when multiplied by the number of occurrences it will have great impact on the profitability.

The very best way to reduce errors is to not make them in the first place! One dollar spent preventing errors should remove the necessity for sixteen dollars spent on correction. This reasoning holds true when attempting to reduce errors by improving the picking methods and techniques. This is not only more cost effective than rigorous inspection, it is easier to do. This applies to a case or unit load picking errors, and more directed towards broken case or individual units type of order selection.

Where does it go wrong?

There are four types of errors: counting errors, cross picking, omission – where the item is not picked, and excess picking where the item is included that was not ordered at all. The most frequent occurrence would be on cross picking, followed by counting errors. The third in frequency is the omission of an entire item and the last on the list is inclusion of an item not ordered.

Cross-picks (product cross-over)	Counting Errors
Most frequent error, normally hard to detect with anything less than 100% item and count check. This is one of the most complicated and costly errors to correct, as it involves credit for the missing item, return freight for the cross-picked item, and the express freight charges for re-shipping the missing item.	Detecting a full case picking error is relatively easy as the total number of cases is known, and the individual item count will add up to the total. In the instance of a split case order, or repacked shipment, the possibility of an item miscount going undetected is higher. This makes checking the split case orders more important than go through the customer complaints, & error rectifying costs.
Error of omission (shortages)	Excess picking (overages)
Even though not very frequent, but when occurs, the impact on services levels and the costs attached to repair the damage are very high. It is not only costly but affects the company image as well.	The error of including items not ordered generates a no win situation. Human nature being what it is, it is rare for a customer to point out that you have sent him goods for which he has not been charged. In this case, you have lost the pick labor, the merchandise and the freight.

The most popular one being checking the picked orders and the other one is to improve the picking situation.

Checking

The operational solution to reduce errors is to check the picked orders and the advantages are; it requires no capital expenditure. Even though it may cost more in the long run, but the positive effect is that this will stop the customer complaints, which in turn will improve the levels of service provided. Morever, it may influence the care taken in picking, by letting the order pickers know that their work is being check for accuracy. This would have a positive impact, as the pickers would be more careful and vigilant while picking the orders.

Improve Picking

Another technique is to modify the picking environment and its control by some productive efforts as more legible sku labels, a good locator system and sequenced pick documents. More radical changes would include mechanized picking equipment, computer aided order picking or paperless picking. This would represent a large investment and must be thoroughly justified in hard dollars and savings. In addition to the savings due to labor productivity increases and space utilization, there is a real saving, often overlooked, which is due to the reduction in errors at the source. It is the evaluation of that saving or the avoidance of the hidden costs due to errors to which this article is aimed at.

Get started …….

The first step is to log the errors detected and corrected. This may be accomplished by a 100% item and count check. This can be done on a temporary basis long enough to develop a measure of the error rate in order selection. The checking operation may then be modified, dropped or continued, based on the economic trade-off of error cost versus checking cost. At any rate, a gauge of the error rate is a necessity in order to reduce the error rate.