Is operational excellence an elusive dream? I think not but it is a definite commitment of time and talent every day. Below are 10 steps that will help you achieve this goal.
1. Communicate
As in every part of your life, communication is essential. Supply chain communication across your network can make the difference on whether you achieve a good result or bad. For instance, say IT is working on a project in the distribution center adding a new feature, but Operations is unaware of this work. Therefore, Operations, needing this area fixed, purchases a solution or manufactures a work around. Whose fingers are pointing at whom? This is a common instance that increases cost when the left hand is unaware of the right hand’s actions. Proper communication helps to break down silos.
2. Training
Another common problem is quality training or the lack of training. The typical large distribution center has 40% turnover rate per year. Depending on geographic location it could be more. A good training program is essential and could increase productivity 10-20%. Why? Training and validation of training ensures that all associates understand the “steps for success.” If people don’t know the proper processes, they create inefficient steps, gradually chipping away at productivity numbers.
Training and training aids are critical and should be done by a person that understands the process. Not by a Human Resource person that would flunk a validation because they just read out of the manual and truly don’t understand the process.
3. Know your operation
A beneficial step is to go through a process flow mapping. Initially, this is labor intensive but a great tool for the future and should be maintained with any changes added over time.
Once you have your process map flow, the next step is to audit the process. Are these steps actually occurring in the warehouse? Have the associates created a work around? If so, is the new process better and should your current process be changed? Now look at each component; is there a new and efficient way of accomplishing this task? How can you reduce walk time or touches out of each component? Would an investment in new MHE or software reap big returns in any step? Then map the process to key performance indicators (KPI). Evaluate your metrics compared to others in like industries. What gets measured gets noticed!
4. Know that you are in the “people business”
Whether you like it or not, you are in the people business, which is sometimes the most challenging aspect of your business. If you hire well and you create a culture of passionate teams, your company will not only excel but will be the envy of all. People spend a good portion of their lives in their jobs. They are either engaged and enjoy what they do or they hate going to work every day. Treat your associates fairly and with respect. Affirm positive actions and you will reap big results. Affirmation is low hanging fruit and should be a process that is spread among the entire management team. It doesn’t cost much but unfortunately most companies don’t understand the inherent value. When you get “A” players in any level of your organization, develop a plan to keep them and grow them for a succession of all stars.
5. Customer service is essential
Many think when we talk about customer service, we are talking about external customers. Every department needs to know who their customer is and communicate with them. Survey them and find out how to better service them and from these support teams you can improve productivity. For instance, IT, Maintenance, Human Resources are suppliers to Operations. If IT doesn’t support with good systems or a fault tolerance plan, operations will fail. If maintenance doesn’t maintain a sorter and it goes down, Operations fails.
6. Order fulfillment is the most costly process in the distribution center
How can you increase throughput or reduce head count? First, know what you do today, so map your process. Second, identify the methodology of your picking processes, such as strict packing, serpentine, cluster, etc. Is there a better way? Third, do an analysis of your pick medium, shelving, carton flow rack, push back rack, a frame, etc. Can you increase productivity by upgrading? Are you taking advantage of premium slotting or the golden zone? Fourth, would technology enhance the process? What new technologies or trends have been introduced? Has the cost been lowered on a previously evaluated technology?
7. Remove barriers of success
What, you have barriers on purpose? Yes. This is also a common problem. Many times the “C Level” executives are not aware that these exist but they do. Your associates know these exist and can easily verbalize all barriers. Listen to them. They do the job eight hours a day. They know what is keeping them from performing their job efficiently.
8. Continually raise the bar
Challenge every department on every team to find better processes and redirection of paperwork, reduction of non-value steps.
9. Know the value of fresh eyes!
There are consultants in the world for a reason, and most add value. One client said, “We don’t know what we don’t know.” Every day you get used to the “we’ve always done it that way” mantra. It is hard to look outside the four walls and see other beneficial changes. You take your body, your car, your lawn mower for check ups. Why not your distribution center? Have an operation audit done by an outside consultant. One that knows practical operations, not one that has never worked with distribution center operations like someone fresh out of college.
10. Don’t pave over cow paths!
If you’re from Kentucky you will know what I am saying but for those of you that don’t, I will clarify. Often times when a distribution center makes a change (new conveyor, new storage rack, new software, etc.) they identify the project with their old processes instead of reviewing new and improved ways of accomplishing a task. This happens all the time and is very prominent with acquiring and implementing new software.
Constantly evaluate new technologies, new trends, and stay aware of what is going on in the field by reading publications or going to industry shows/conferences that add educational opportunities. Don’t be stuck in the “we’ve always done it that way” mud.
1. Communicate
As in every part of your life, communication is essential. Supply chain communication across your network can make the difference on whether you achieve a good result or bad. For instance, say IT is working on a project in the distribution center adding a new feature, but Operations is unaware of this work. Therefore, Operations, needing this area fixed, purchases a solution or manufactures a work around. Whose fingers are pointing at whom? This is a common instance that increases cost when the left hand is unaware of the right hand’s actions. Proper communication helps to break down silos.
2. Training
Another common problem is quality training or the lack of training. The typical large distribution center has 40% turnover rate per year. Depending on geographic location it could be more. A good training program is essential and could increase productivity 10-20%. Why? Training and validation of training ensures that all associates understand the “steps for success.” If people don’t know the proper processes, they create inefficient steps, gradually chipping away at productivity numbers.
Training and training aids are critical and should be done by a person that understands the process. Not by a Human Resource person that would flunk a validation because they just read out of the manual and truly don’t understand the process.
3. Know your operation
A beneficial step is to go through a process flow mapping. Initially, this is labor intensive but a great tool for the future and should be maintained with any changes added over time.
Once you have your process map flow, the next step is to audit the process. Are these steps actually occurring in the warehouse? Have the associates created a work around? If so, is the new process better and should your current process be changed? Now look at each component; is there a new and efficient way of accomplishing this task? How can you reduce walk time or touches out of each component? Would an investment in new MHE or software reap big returns in any step? Then map the process to key performance indicators (KPI). Evaluate your metrics compared to others in like industries. What gets measured gets noticed!
4. Know that you are in the “people business”
Whether you like it or not, you are in the people business, which is sometimes the most challenging aspect of your business. If you hire well and you create a culture of passionate teams, your company will not only excel but will be the envy of all. People spend a good portion of their lives in their jobs. They are either engaged and enjoy what they do or they hate going to work every day. Treat your associates fairly and with respect. Affirm positive actions and you will reap big results. Affirmation is low hanging fruit and should be a process that is spread among the entire management team. It doesn’t cost much but unfortunately most companies don’t understand the inherent value. When you get “A” players in any level of your organization, develop a plan to keep them and grow them for a succession of all stars.
5. Customer service is essential
Many think when we talk about customer service, we are talking about external customers. Every department needs to know who their customer is and communicate with them. Survey them and find out how to better service them and from these support teams you can improve productivity. For instance, IT, Maintenance, Human Resources are suppliers to Operations. If IT doesn’t support with good systems or a fault tolerance plan, operations will fail. If maintenance doesn’t maintain a sorter and it goes down, Operations fails.
6. Order fulfillment is the most costly process in the distribution center
How can you increase throughput or reduce head count? First, know what you do today, so map your process. Second, identify the methodology of your picking processes, such as strict packing, serpentine, cluster, etc. Is there a better way? Third, do an analysis of your pick medium, shelving, carton flow rack, push back rack, a frame, etc. Can you increase productivity by upgrading? Are you taking advantage of premium slotting or the golden zone? Fourth, would technology enhance the process? What new technologies or trends have been introduced? Has the cost been lowered on a previously evaluated technology?
7. Remove barriers of success
What, you have barriers on purpose? Yes. This is also a common problem. Many times the “C Level” executives are not aware that these exist but they do. Your associates know these exist and can easily verbalize all barriers. Listen to them. They do the job eight hours a day. They know what is keeping them from performing their job efficiently.
8. Continually raise the bar
Challenge every department on every team to find better processes and redirection of paperwork, reduction of non-value steps.
9. Know the value of fresh eyes!
There are consultants in the world for a reason, and most add value. One client said, “We don’t know what we don’t know.” Every day you get used to the “we’ve always done it that way” mantra. It is hard to look outside the four walls and see other beneficial changes. You take your body, your car, your lawn mower for check ups. Why not your distribution center? Have an operation audit done by an outside consultant. One that knows practical operations, not one that has never worked with distribution center operations like someone fresh out of college.
10. Don’t pave over cow paths!
If you’re from Kentucky you will know what I am saying but for those of you that don’t, I will clarify. Often times when a distribution center makes a change (new conveyor, new storage rack, new software, etc.) they identify the project with their old processes instead of reviewing new and improved ways of accomplishing a task. This happens all the time and is very prominent with acquiring and implementing new software.
Constantly evaluate new technologies, new trends, and stay aware of what is going on in the field by reading publications or going to industry shows/conferences that add educational opportunities. Don’t be stuck in the “we’ve always done it that way” mud.
