Voice efficiency as a revenue generator

For Cengage, a leading publisher of learning materials for the K-12 market, efficient DC operations and order fulfillment processes are nothing new. The Boston-based company has been using a voice-directed system for order picking accuracy and fulfillment efficiencies at its main U.S. distribution center for more than 15 years.

The company has enhanced its initial use of voice with added workflows and performance management capabilities over the years. What’s more, the resulting efficiencies gained using voice and other systems are now being tapped to support third-party logistics (3PL) customers, turning the company’s flagship fulfillment center into a revenue-generating part of its business.

In the world of K-12 education, the print business has changed over the decades and Cengage has changed with it to remain one of the top publishers of learning materials and content. From its inception over a century ago, Cengage has adapted to the market, excelling at distribution of print and digital content. Cengage operates five warehouses globally with their largest U.S. location in Independence, Ky. This warehouse has more than 14 miles of conveyor systems and employs more than 200 workers.

To improve key fulfillment processes, Cengage first-deployed a voice-directed system (Lucas Systems) more than 15 years ago at the Kentucky DC. The Lucas voice solution, known as Jennifer, was deployed to increase order picking performance and enhance safety and ergonomics for warehouse associates.

Before the voice solution, performance was hampered by the slow pace of handling paperwork and the lack of a hands-free environment. “You’re opening cartons, handling books, putting them into those cartons, combing them into trains,” says Jason Tucker, director of the Independence fulfillment center. “We knew we needed a hands-free solution.”

Since the installation of Jennifer, along with the Lucas Warehouse Optimization Suite, Cengage has increased key performance metrics across the board. The initial deployment started in the replenishment area and has since migrated to other work areas of the warehouse, including order picking. Most days, close to 200 associates use the voice system, though use may scale up during peak seasons.

The hands-free nature of the voice solution and its ability to verify the correct SKUs and quantities are being handled has brought measurable gains. “There has been an overall boost in productivity of 15%, order accuracy increased by 5%, with a 10% reduction in labor needed,” says Sonny Adkins, Cengage’s director of distribution.

The accuracy of the voice-directed processes is also seen as helping overall efficiency. “One of the biggest impacts from Lucas is the increase in accuracy and how it allows us to have fewer workers on downstream processes like quality control and shipping,” says Tucker.

The voice solution is quick to learn, which helps with onboarding new associates and contributing to worker satisfaction. “The simplicity of training with Jennifer helps us attract new employees,” says Adkins. “Training takes an hour to half an hour.”

Unlike some older voice systems, the Jennifer voice recognition engine does not require an extensive period of time to “learn” each worker’s voice, keeping Cengage’s warehouse running smoothly while meeting its goals of handling high volumes and same-day turnaround, even when adding seasonal staff or training new employees. “Cengage provides over 4 million units in a single month while still maintaining that 99.5% orders go out within 24 hours,” Adkins notes.

As the marketplace for learning materials has changed, Cengage has moved to a 50/50 split from traditional textbook publishing to offering all kinds of digital solutions, e-books and “homework assistant” solutions.

With the Warehouse Optimization Suite technology, which includes dashboards and metrics, and support from Lucas, Cengage realized they had become quite good at distribution. In fact, so good they began attracting 3PL customers to fill in some of the empty DC space that was given up to the digital business.

“The distribution team realized that while we have a great distribution facility, we need to replace the volume lost to the digital business growth,” Tucker says. “There’s been a lot of time and effort invested in this facility. What we decided to do was to start bringing in third-party customers that would use us as a fulfillment partner and allow us to run the same amount of volume we were running previously. As more 3PL customers join, they are easily transitioned into the Lucas system.”

Over the recent years, Cengage has added about 10 3PL customers supported by the warehouse. “We have seen a decline in print; but, with help from the 3PL business, we are now a revenue center, not a cost center,” adds Adkins.