Leadership and organizational structure is often underestimated in warehouses. It is strange given that warehouses are often large to the surface with many subdivisions and different types of flows both in and out of the warehouse.
Compared to production industry, it is often more blue collars per manager in a warehouse, it is not unusual that a leader has up to 30 subordinates. This despite the optimal span of control (SOC) you find in research: from 4 to 9 subordinates at the top level and from 8 to 15 at lower levels, presented by various authors – H. Fayol, Urwick, E. Dale, J. Woodword, H. Koontz and O’ Donnel.
As the number of subordinates per manager increases, the sick leave and dissatisfaction also increases. Efficiency and quality decreases significantly with too many subordinates per manager.
The money you invest in a transparent and competent leadership can quickly repay in efficiency and quality. It is important that the leaders in the warehouse works closely with the operations and are involved as much as possible. That you do not burden them with too much administrative tasks like data collection and consolidation / evaluation of data, it is better to put a warehouse administrator on those tasks to free the leaders.
It is also important that the leaders have a mandate to perform their leadership. They should have the direct personnel responsibility and should be able to take their own decisions without having to reconnect every decision to superiors. A leader without mandate erodes the staff´s confidence immediately.
There must be clear objectives! A leader who does not have any clear objectives are as lost as a Captain without a compass is! In production units, there is a pace and goal for every single process, it should apply in the warehouse too. Everything can be measured and put a pace on, and the results should be followed up at regular intervals. It is always the immediate manager / leader who should communicate that kind of feedback. The senior manager communicates the overall goals and results.
As I have written in previous articles, warehouse operations often suffer of sub-optimizations. The bigger warehouse is, the greater the risk of sub-optimization. This is because there are so many different complex flows in a warehouse; it is difficult to see the big picture. It is the warehouse manager most important task to ensure that subordinate managers constantly puts the big picture first and that they are working towards common goals.
Finally, to skimp on leadership and organization in a warehouse is not a good decision. Opt for leaders with a maximum of 15-20 subordinates. Educate these leaders in leadership and give them proper mandate to exercise their leadership and help them to develop concrete goals for their departments to suit those overall goals.
Good leadership and a strong warehouse organization can do wonders for the financial results.