Faced with a 30-day window, Offset Paperback Manufacturing, Inc. implemented a warehouse management system (WMS) and radio frequency (RF) technology to handle its inventory and distribution. The book manufacturer now produces and ships an average of 1.2 million books per day.
This was the scenario staring Offset Paperback Manufacturing, Inc. (OPM) square in the eyes. The wholly owned subsidiary of Bertelsmann AG is the largest paperback book manufacturer in North America. At $13 billion in gross sales for 1998, OPM's parent company is the third largest media company in the world. (You may have heard of the top two companies Time Warner and Disney.) For its part, OPM turns out an average of 1.2 million books per day. Keeping track of 1 million of anything can cause big headaches. For OPM, however, the headaches were intensified because the 800-employee company was using a manual, paper-based system to track manufacturing, inventory, and distribution.
Thus, Ron Place, director of logistics and information technology (IT) at OPM, threw down the gauntlet. His challenge: implement a warehouse management system (WMS) and automatic identification and data collection (AIDC) technology in 30 days. "Everything we do at OPM is fast-paced, and that's an absolute fact," says Place with confidence in his voice. "We don't allow ourselves time to breathe."
When you manufacture more than 1 million books per day, there really isn't much time to breathe. OPM operates three shifts of employees who work five days per week. Even though the WMS and AIDC technologies were installed while production hummed along, Place can't think of an area where he could have shaved off superfluous hours. "Thirty days to implement is about as fast as I can imagine," adds Place. "In fact, I think that type of time frame is really pushing the envelope."
Moving To An Open Systems Platform
It was six years ago when Ron Place came to OPM. He joined a company that was running its enterprise applications on an AS/400. From a systems perspective, Place felt OPM was not as "nimble" as it should be. "During the past six years, we have invested significant time and money in moving the company to a PC LAN (local area network) architecture. Today, we run the entire company on a PC LAN. We use Windows NT as the OS (operating system) and SQL as the database structure," says Place.
Establishing a new, open platform was a key component of OPM's overall IT strategy, which was developed several years ago. The strategy allows OPM to minimize its investment in individual pieces of technology. At the same time, OPM can install new systems in a modular fashion — one piece at a time. In the spring of 1999, it was time to move forward with warehouse automation. For its WMS, OPM chose Warehouse Compass from Midgard Information Systems. Peak Technologies supplied radio frequency (RF) technology from Symbol Technologies. Both Midgard and Peak helped OPM implement its new system.
Tagging Pallets, Delivering The Goods
The 10 offset presses at OPM churn out best-selling titles from authors like John Grisham and Tom Clancy. However, there are many steps that must be completed before the latest thriller is displayed at a local retail bookstore. Giant cylinders of paper, like rolls of adding machine receipt paper on steroids, roll through the presses as ink-coated printing plates lay down the text. The pages are folded accordingly and bound into the spine of the book. Five-color presses produce the color covers of the paperback, which are married to the book before binding. Finally, the book edges are trimmed and, one after another, books flow off the conveyors and are assembled onto pallets. "For the most part, all of our customers are large publishing companies," states Place. "Our production runs for these customers range from 2,500 to more than a million. But, the typical order is for less than 100,000 books."
There's minimal docking space at OPM's manufacturing facility in Dallas, PA, and the pallets must be shipped shortly after they are assembled. Loftware, Inc. software integrates with Warehouse Compass to produce bar code labels. Each pallet is tagged with a bar code label that serves as a unique identifier a "license plate." "We pull the pallets into the WMS at the Dallas facility, and the system lets us track each pallet. The license plate on each pallet is associated with information stored in the system, such as book title, quantity, and customer," explains Place. "We actually use this same information to create advanced shipping notices (ASNs) for our warehouse (Laflin, PA). When a shipment goes to our warehouse, an employee just scans the bar code and receives the entire pallet. This process updates our inventory in real time."
Shipping Books Out Fast
OPM's Laflin warehouse initially receives most of the books manufactured by the company. From that location, the books are distributed to both wholesalers and retailers. "Original titles need to be released to the wholesale and retail market at the same time," comments Place. "Our distribution system allows wholesale shipments to occur before retail shipments. In this way, the books get on the shelves at about the same time. One retailer won't have the advantage of having a John Grisham title before any other retailer."
"Working In The 20th Century"
In the last 500 years, the printing process has improved exponentially. It was once a breakthrough to print a single page of text. Now, OPM manufactures more than 300 million books each year. The process for handling these books has also improved at OPM. "Warehouse Compass and RF technology replaced the paper-based system we were using for warehousing and distribution. The improvements in automation have been staggering. It was like we were using 19th century technology, and now we are working in the 20th century," comments Place.
It took OPM only 30 days to travel 100 years through the technological timeline that Place describes. Thirty days it's not that much time at all. For IT managers working under the same deadline, it's better to think of it as 43,200 minutes. It just seems like more time that way.