Avoid Sub-optimization in the warehouse, not as trendy as agile but just as important

Two popular  words  in logistics, Lean and Agile. These words are also among the first mentioned by colleagues I meet in the logistics industry when they want to explain their logistics operations. Of course, I think Lean is a good philosophy, I use it myself and it sure is good to be agile. Actually if you have implemented Lean then you are automatically Agile because Lean is based on that you should not lock yourself in specific methods by building “monuments” for example.

But a word I think you should start with before you begin to focus on the two trendier words are sub-optimization. All too often when I’m out and look at other warehouses, I see how they have built up departments where staff are placed permanent and how each department manager is working and struggling that he or she should get more resources and not one of the other departments.

Sub- optimizations that I describe above, costs a lot of money. In my opinion it is one of the most common and biggest time thieves in warehouse logistics. Instead of moving and reallocate personnel resources in the warehouse on a daily basis where it is necessary the manager rent staff to a department that is understaffed while another department have too much staff.

This affects not only staff costs, but it can also affect the level of service if a department cannot process incoming goods fast enough because of insufficient staffing. It can also affect quality if it is too high workload for staff.

I understand that you want to structure and organize your warehouse into departments with permanent staff, it provides a sense of orderliness but it is very inefficient, and you lose the synergy effects in the warehouse.

The best way to prevent sub-optimization is to use job rotation. Even on large warehouses it is good to rotate staff but it may not be as frequent as in smaller warehouses. Job rotation gives staff a holistic approach and they do not become “loyal” to just one department. If you apply job rotation you automatically become agile and you work Lean. If there is an increased workload at any department because of campaign or seasonal goods or similar you can quickly allocate staff from another department that does not have as big work load. By moving resources from one department to another, you do not have a time delay before receiving external resources. If you have permanently placed staff you also need to have a “buffer” to manage unplanned absences etc. You can remove the buffer if you have “floating” staff.

Also rotate staff between the different procedures in the warehouse to secure competence for example in case of peaks in e-commerce, illness or holidays. In this way you do not risk being out of staff at goods receipt or put away because you can quickly move staff from one picking department that have less workload and can spare resources.

This “mobility” in the warehouse applies not only to the staff it also applies to hardware such as forklifts and picking trolleys, for example. You don’t want unused resources which are pure destruction of capital.

As you can see there are many advantages to having “flexible” resources in the warehouse, if you avoid sub-optimization you will be both agile and lean and you can increase the service rate and improve quality. But in order to achieve this, it requires that you have a competent management in the warehouse who dare to reallocate resources and which can cooperate with each other. It must be you, as warehouse manager / site manager to control this. It is very important that this approach comes from the top of the organization and that it does not reward departments that has succeeded individually. It is when the warehouse as a whole is successful you should reward.

In a modern WMS, you have great tools to monitor the workload in the warehouse and in various departments, it helps in the allocation of resources significantly.

Roberth Karlsson

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