Supply Chain Analytics:"Improves warehouse labour management"

 Supply Chain Analytics:"Improves warehouse labour management"

Apply standardised measurement

Whether you business runs its own warehouse or outsources to a 3PL provider, achieving a high level of warehouse labour productivity is essential, but how do you know that the current levels are delivering the right levels of productivity? The performance any warehouse operation should be constantly measured by management to ensure that the highest levels of productivity are being achieved by your warehouse operators. As the role of a typical warehouse operator is generally task orientated, some organisations have tried to adopt an industrial engineering approach such as time and motion study to observe, measure and mathematically calculate standard operating times or cycles times for replenishment, put away, order picking or receiving activities. As the industrial engineering approach is more commonly used in repetitive and batch orientated production environments, other businesses have had success implementing a hybrid measurement system for their warehouse operation that is better suited to measure non repetitive tasks.

The importance of warehouse labour measurement

As warehouse staff perform a number of tasks during their shift, it is important to understand each task and apply the right measurement for each in order to improve the process. Each task must have a standard cycle time which has been compiled through historical sampling or industry benchmark data for your business sector. What ever the source, it is important to have a defined and agreed measurement system of standards that are understood across the business that become your baseline for performance improvement. If the performance gap is wide, further analysis can be undertaken to dissect the problem to determine if the process needs modification or if the warehouse operator requires further training and education.

The benefits of using supply chain analytics

As there are a range of operational benefits that standard measurement systems offer your business, the main benefit in our view is transparency which then drives accountability. If the system is implemented using the right change management strategy thwoughout your warehouse operation, each warehouse operator will be able to see the state of play every day and know department or individual performance is below or above expected levels. From this position, any changes a business needs to make, although difficult in a challenging business climate, can be made using this performance data. Relocation decisions, process modifications, changes in layout and warehouse downsizing as a few decisions that can be made with more accuracy. Enterprise bargaining agreements can contain incentive based productivity measures that are underpinned by your transparent standard measurement system.

The challenges with warehouse labour measurement

When making a management decision to change a process or relocate an operation, these decisions must be made on a like for like basis where possible. For example, if your current warehouse operation uses manual processes for physical movement of stock and paper based picking and invoicing systems, the labour measurement standard and cycle times will reflect these tasks. If the new site is a different layout and will be using RF, ERP and WMS technologies, then the rates of labour measurement would be considerably different and reflect increased or decreased standard rates. Other factors that affect the standard labour measurement are the mix of inventory, volume of inventory and frequency of physical stock movement.

Supply Chain Analytics:"Improves warehouse labour management