Getting down to business

As the vice president of logistics for Milwaukee-based multititle business mailer K+K America, Chuck Mathe oversees four distribution centers: In addition to the fulfillment center at its headquarters, K+K has DCs in Reno, NV; Southaven, MS; and Cranbury, NJ. K+K’s catalog titles include C&H Distributors, which sells material handling and warehouse storage merchandise; occupational safety supplier Conney Safety Products; food services supplier Hubert; and National Business Furniture, which it acquired in November 2005.

What’s the biggest challenge in the DC?

Keeping up with technology advances to improve productivity. We use wireless devices in some of our facilities, which greatly enhance the real-time need for order information, shipping, and receipts. We want to install a voice recognition picking system, but we’re installing an [enterprise resource planning] system, and that’s the priority. This has been on our wish list for at least three years. Voice recognition will provide almost 100% accuracy while reducing the distractions of reading paper or a wireless device. Having the capital dollars to invest in technology that may take a year to implement throughout the distribution network and keeping an eye on the leading edge is our biggest challenge.

Describe an interesting work-around in your DC and its resolution.

We’re challenged to do work-arounds all the time. We had a full double-check system in place where everything our pickers picked was checked by a packer. We could not figure out why there were errors. After researching the problem it was apparent that the pickers were not being held accountable for their picking errors. The packers would pack the same mispicked items without fully checking. The work-around or solution was simple: Each picker picks and packs his own orders, which makes him accountable from pick to pack. Errors dropped immediately to acceptable levels.

What’s been the greatest innovation in fulfillment during the past five years, and how has it changed your operation?

RFID. Although we have not invested in the technology, this innovation will eventually give distribution some of the most advanced fulfillment tools around. The ability to track product from start to finish will lead to productivity gains and 100% accuracy in inventory management. The fact that Wal-Mart, Target, and the Department of Defense are forcing their suppliers to invest in this technology will make us all more efficient in the long run. But the cost will need to come down.

If you had to choose: backorders or overstocks?

Backorders, as long as the fulfillment comes within 48 hours of backorder creation. This way more product can be cross-docked, leading to high productivity and reduced obsolescence. If fulfillment cannot come in that 48-hour window, more inventory is better. Without this standard of fulfillment, customers will go away.

What was your “welcome to operations” moment?

Earlier in my career, I lifted a load that crashed into an overhead sprinkler head just as the president of the company came around a corner. The timing could not have been worse. About five seconds after the head broke he came around the corner and at that moment I was just staring up to the ceiling in shock. As the water was pouring out of the sprinkler head, the president barked out something to the effect of “go shut of the water” and walked away shaking his head. I thought my career was going to meet an early end.

If money were no object, what equipment would you like for your DC?

Conveyors and wire-guided picking modules. This would reduce damage to racking systems, improve productivity, and help maximize warehouse space. Some of this, like the conveyors, will happen. And wire-guided picking modules are in the test mode right now in our Nevada facility.