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Using an expected workforce-staffing estimate for each prod- uct loop, the system automatically measures product volume in each loop, and quickly adjusts to workforce changes. L.L. Bean achieves this optimized work-in-process distribution by monitoring workflow and estimated workforce to ensure the product-processing loops are continually in balance. Now, as a product comes in the door, one associate can han- dle it from the time it is picked off the conveyor belt to be scanned, processed, and prepped, to the time it is sorted to a tote and placed back on the conveyor for reintroduction into L.L. Bean’s inventory. STICKING TO THE SCHEDULE L.L. Bean scheduled the implementation for the time of year when the volume of returns is low, and finished just in time for the peak holiday season. “We used a phased-in approach to replace the old system,” says Steele. “We were able to stay on track with the planned schedule, and the physical install took a total of three months.” “While returns were still being processed with the legacy sys- tem, we were installing the new system, and training employees for the switch,” says Ysasi. “It was a complicated transition but we made sure to keep communications open between both teams.” Today, 80 percent of returns can be processed with one touch to reduce re-handling, a big change from the old days. Within the first few months of using VARGO’s system, L.L. Bean’s pro- ductivity jumped. Employees who formerly processed 16.5 units per hour now handle 18 per hour, a number that Steele expects will increase during peak season. Cost savings have been high as well–the simple act of shav- ing seconds off processing each return leads to hundreds of thousands of dollars in labor savings. By eliminating two hand- offs, the company also has improved merchandise operations and maintained “first in, first out” returns processing. The improvement that pleases Barb Wood the most, how- ever, is the reduction in injury rates. “We’ve brought injuries down by 50 percent,” she says. “The employees have been very happy with the system, a change that is usually tough on them. They are excited about their new work space and pro- cess improvements.” In addition, L.L. Bean is pleased with the ROI it expects from the new technology. While it costs about $14 million annu- ally to run the returns department, the company considers it money well spent because keeping customers happy pays off in spades. The key to the success of the new returns processes is that Bean listened to its employees. “Our returns center employees led us to this solution,” Wood points out. “The solution appears very sim- ple, but the intelligence behind it is what makes it work.” In the future, L.L. Bean may add a third loop to its two new ones. But for now, the company is as satisfied as its customers with the new returns system. ■
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Under construction: Hyperlogistics’ NEW 407,000-sq.-ft. import warehouse in the Rickenbacker Global Logistics Park. Operating within this Columbus, Ohio, FTZ and adjacent to Norfolk Southern’s new intermodal terminal, Hyperlogistics can now offer additional transloading capabilities, while cutting transit times and reducing rates.
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