Effective warehouse operations are a careful balance of how time, space, infrastructure, and staff are utilised. In most operations, there are simple ways to improve warehouse efficiency. Identifying the key opportunities and mapping out a plan to address these step-by-step is critical to driving change.
There are myriad ways you can optimise your warehouse at a small scale that do not require huge upfront cost, approvals, time, consultation, or risk. Start small – but start. Here’s how:
- Information is power. Do you have visibility across your supply chain? Large-scale, tier one systems make headlines, but information and process flows can be as simple as an Excel spreadsheet. Often, organisations do not have clearly articulated workflows in place, relying instead on the experience or knowledge of their people, making the business vulnerable when an individual leaves or retires. You can only make optimal business decisions with good data.
- Identify the right operational metrics. Do you measure your operations? If so, how? Is the tactical focus where it should be? At each level of your organisation, you should establish fit-for-purpose and appropriate metrics. For example, direct operators may have productivity targets; supervisors may have overall team efficiency metrics; site leadership may have overall performance and site cost metrics. Carefully considering what you are measuring at each level of the organisation helps to drive the right behaviours and therefore, outcomes.
- Get the labour mix right. In a challenging labour market, warehouse operators fail to consider the required balance between casual and permanent staff. Too many casual contracts will negatively impact staff retention, particularly if nearby competitors offer more stable employment or better working conditions. Hiring, training, upskilling, and retaining good workers is a time and cost investment. Consider converting casuals into permanent contracts where you can help stabilise the workforce and reduce unnecessary effort.
- Automation feasibility study. Regardless of whether you implement the recommendations, this exercise will give you insights into where you can improve efficiency across your DC operations. Identifying the areas of highest operational cost will help to identify what automation opportunities exist that are right for your business.
There are diverse ways you can improve efficiency in your warehouse operations. Set-and-forget solutions are sometimes the only thing operators are interested in. These can be valuable, but they will not solve your business challenges in the long–term and sometimes the benefits are unsustainable. You need to consistently evaluate what is and what is not working in your warehouse.
Identify the key areas of pain or high areas of spend and put steps in place to tackle these one at a time. Start small – but start.
Max Reynolds is Director – DC Design and Optimisation at TMX Global.
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