A warehouse is a complicated and busy place, and it can be hard to get an accurate sense of what is happening. Warehouses are constantly under pressure to increase its productivity and accuracy while reducing costs and improving customer service. Warehouse improvement needs to be a continuous aspect of businesses. The measurement of productivity is the most significant dimension for warehousing to monitor the output from the input provided in warehouse operations. It is important for warehouses to have a problem-solving approach and ask appropriate questions. Following is the useful framework to adopt which can help warehouses to analyses right questions.
- Where are we now? – This involves an analysis of the current situation in measurable terms. Measurements can be by quantity, cubic volume, time, or cost. For example, with warehousing, Operating productivity, such as pick-lines, orders, cartons, pallets handled per person per hour
- Where do we want to be? – This involves setting up clear objective for improvement. There are still many Warehousing companies without a clear KPIs program. For them, this step is a must if they want to have an idea about how they can improve and where they want to focus on process improvement. For example, to improve the picking rate from 80 to 100 pick lines per hour. Ideally, a measurement of productivity should be unbiased and consistent with warehouse operations.
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- How are we going to get there? – This involves looking at options and methods available for improvements, selection and then making a plan for implementing improvements. There are so many variables in play while implementing improvements in the warehouse, such as labour, staffing, workload, scheduling, and suppliers. It can be hard to pinpoint the areas where business should be focusing on in order to become more efficient. Sometimes process improvement can be achieved without changing any process flow but transforming the space. that’s where slotting exercise, pareto analysis and ABC analysis can be used.
- How will we know we have arrived? – This involves benchmarking where comparing the new situation against the standard expected. Benchmarking for warehousing and distribution operations is an appropriate and popular first step in re-engineering warehousing operations. Benchmarking may be done internally, on the processes within a single company; or externally, on the same process in other industries; or on the same process in competitors. for example, on picking, this is 80 picks per hour rate, against the improvement objective standard of 100 picks per hour.
By having a clear analytical framework, warehouses can work through an improvement programme and can measure progress being made.
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