3 Components of Effective Warehouse Operational Design
If you are planning a redesign of your warehouse or distribution center (DC), then chances are good that you’ve spent a lot of time thinking about the systems that you need to put in place in order to create the most efficient workflow. This makes sense, as the need to properly use your space and implement the right technologies are essential if you want your new facility to operate at its highest capacity.
Once you’ve laid all of the groundwork—assembled the right team, culled all the right data (SKU data, item master data, order history), and mapped out how the layout needs to hit all of your business goals—it can be tricky to know where to go from there.
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Before embarking on an implementing an automated operational design in your facility, consider the following:
- Even the most automated warehouse system will not run itself. Automated systems will require optimization and some level of management.
- Managing the operational change is critical. There is often a huge dip in productivity after the implementation of an automated system that can last up to several months in some instances, depending upon the maturity of the workforce and their experience in prior startups. This is because of the obvious disruption that implementing any new system causes. An effective leader will manage this process to lessen this productivity dip as much as possible.
The takeaway is clear: Operational excellence is a collaborative process. We’ve found that the most successful startups have the following qualities in common.
They Know that It’s All About the Team
Operational success is about more than just the systems; you’ve also got to take into account the human element. When you’re tackling a project as extensive as changing your operation’s design and processes, this is something that you can’t afford to forget.
From the beginning of any project, it’s important to have a clear communication chart of the people involved so that, if issues arise, you can easily and effectively come to a resolution. This should include details about what each person is responsible for, and their contact information.
Why is this so important? When one person insists on being the conduit through which all information must flow, critical information can be lost or held back, which has the potential to delay an entire project. Having leads from each project team, with clear subject matter ownership beneath them who are included on critical information, will ensure quality information is exchanged throughout the project cycle. Effective communication will lead to an effective operational design.
Beyond communication, you must also ensure stability while you expand your team beyond the core set of individuals. Ask yourself:
- What is the organizational structure at the operational level?
- Are there sufficient layers of management, team leaders, and supervisors in place so there is a stable environment as the system is fine-tuned and hardened through testing and staff sign off?
As the organization grows around this core team, it is important to ensure that there is accountability and a stable base group as other employees come and go during the earlier phases of a project.
They Keep the Numbers in Mind
When tackling a new project, especially one as complex as changing your operational design, it is important to constantly go back to the important numbers: Goals, measurements, and rewards.
Goals need to be clearly set and communicated to the team ahead of time so there is alignment between what is expected and the actual performance levels in the DC. These levels should be measured and posted in consistent terms (increases in orders, cartons, or lines, etc., compared to the old numbers) so that there is uniformity in the terminology allowing the team to see the progress.
Some clients have had a tremendous amount of success by incentivizing their teams, which has increased performance well above expected levels. Offering rewards serves to encourage employees to be more productive, which increases performance of the operation and ultimately reduces costs while improving service levels to clients.
For example, you can use software systems to track pick rates by operator. This information, when compared to historical reporting, can be used to determine pick rates changes over time. This will provide a baseline for your reward incentives.
They Know that Training is Key to Success
Implementing a new operational system is only the first half of the battle. Once you’ve made the change, you’ve also got to devote adequate time and resources to training your staff on the new technologies and processes.
If you don’t devote enough time to training your employees, you are setting yourself up for lackluster return on the investment that you’ve just made. A large percentage of the loss of productivity that occurs after the implementation of an automated system is caused by staff not understanding how the system works or how they fit into the new processes. It’s natural, and it’s to be expected, but you can lessen the decline in productivity by properly training your employees before the system goes live.
Properly setting expectations around reasonable performance levels that will increase over time will result in a positive experience as successes are achieved and built upon consistently as time passes and productivity continues to climb.
The Bottom Line
Making changes to the operational design of your warehouse is a huge undertaking. Just remember it’s important to keep in mind that simply coming up with the most efficient design is only half the battle; the other half involves leadership—organizing the team, tracking the numbers, and devoting adequate resources to training. Only by understanding the human element and how it plays into your operation will you truly be successful in your facility redesign.
