5 Fundamental Practices to Make The Implementation of Warehouse Technology Pay off Big Time
Warehouse operations and their efficiency are a key to any company that deals with freight, shipping and inventories. When efficiency lags behind however, orders are lost and things get out of control. This chaotic environment (usually due to those companies who are still using manual process in the warehouse) will directly affect the profits and reputation to customers of your company. The following aims to give you a better understanding on how you can optimize your warehouse operations to avoid delays and screw ups, making things seamless and fluid through the use of warehouse technology. However, read to the end, as technology is not the end all be all....we must still follow some warehouse efficiency basics along side warehouse technology to ultimately gain efficiency.
Make Warehouse Process as Simple, Efficient, and Technologically Driven as Possible
Minimizing the steps in the process is a good way to ensure you have a more rapid movement through the warehouse and the freight process. You can benefit from automated packing and shipping processes, such as the use of a transportation management system, for a more efficient outcome and flow around the warehouse on the outbound side of getting out product to your customer. It will take some operational changes and a look at implementation of technology such as ERP, WMS, and TMS, but it will be well worth the effort in the long run. This is especially important when it comes to storage facilities and storage solutions in general.
If you are looking for a checklist to ascertain your needs in total in the warehouse, you can look to our handy guide here titled "Third Party Logistics Companies: A Checklist When Evaluating Which 3PLs are Best for YOUR Needs". The next step that will help is reading our other post on 3PLs, "3PL Companies: 4 Factors To Consider in Your Evaluation of Hiring One". Finally, if you do think you need to go down the path of hiring a 3PL, you may want to also see our series on how to implement a 3PL once you know your needs:
- 3PL Implementation Steps Part 1: Where to Begin
- 3PL Pricing Structure: Part 2 In Third Party Logistics Implementation
- Bonus: Logistics Service Level Agreement and Logistics Key Performance Indicators: A White Paper
The Importance of Real Time Data and Visibility in Technology Mirrors GEMBA and KANBAN Philosophies
You would also do well to let some of the incoming warehouse management processes be handled by a transportation management system that has automation features for inbound transportation functions. This type of system will help manage the handling of inbound freight in real time, which will overall boost the performance and speed of the warehouse as well as requiring less involvement on your part.
Stock materials should be used with technology that connects your workers and the process they need to go through to complete their job. You should make sure you prevent the chance of misplacement with good supply chain technology where the warehouse workers can look for the freight quickly and efficiently. Sit back and think of the automatic data flow that is possible, giving all employees visibility with on floor displays, mobile apps, and strategic meetings once all of your warehouse systems for the supply chain are interconnected. The ERP speaks to the TMS, which then speaks to the WMS. Technology is truly the beginning of efficiency, but the end and ultimately the best results comes from getting management and leadership aware of these new changes. Then, managers can use GEMBA, and like KANBAN, all is visible, and thus all are more efficient.
Using Real Time Data and Warehouse Technology Creates Great Companies with Happy Customers
The implementation of warehouse technology which provides more visibility through data allows each employee, at a moments notice, to collect real time information on the various warehouse and logistics process holistically, getting everyone on the same page. We know that when a company's culture is one of trust, backed by understood terms and data, it leads to collaboration, and then finally results in, one of the most important aspects of staying competitive as a company, innovation. As Toyota proved with it's stellar supply chain and use of these ideas of GEMBA and KANBAN, in what is now called the "Toyota Way", a company who implements operational changes with the use of warehouse technology, can also stand out and stay ahead of competition.
Customer demands are what change and dictates the requirements for flexibility, as well as the flow of the freight that comes in as you need to produce more and the freight that goes out as you get products to customer. If you want to support improvements to your warehouse technology & processes, then you will need to analyze the incoming real time data so you can devise a better strategy for overcoming any difficulties you may be facing. This will help in the long run, especially once you analyze the collected data and you figure out ways you can respond to the changing customer demands and business goals ahead.
Technology is Amazing, But Let's NOT Forget the Common Sense Fundamentals to Maximize the Use of Warehouse Technology
- Make sure the Warehouse is Aligned to What the Business Wants: Align the operations of your warehouse with the business goals you set in mind when you decided to implement new processes and warehouse technology. Even if you have pressure coming in from your customer base to speed things up, you should still keep your business objectives in mind as well. Find a good balance of action and strategy to ensure you meet both ends of the spectrum for optimum results.
- Training: Employees must be trained on procedures, including interaction with the warehouse technology you are implementing such WMS, ERP, or TMS . The excellent manager spends quality time with each team member to coach and encourage him or her. The WMS provides individual performance data to inform the manager as to who needs what specific training. The manager needs to then continually improve using this data.
- Employee Motivation: Employee motivation can begin as simply as posting charts of comparative performance to encourage competition. After some data have been collected from the WMS, standards should be established for each warehouse task. Employees who exceed standards can be rewarded informally with perks or specific prizes. Ultimately, a formal gain sharing program can entice an appreciable increase in productivity. Productivity increases of 30% have been reported.
- Physical Plant: An excellent warehouse includes adequate dock capacity, ample staging areas, appropriate storage (pallet rack, shelving, flow rack etc.), and suitable equipment (carts, pallet jacks, fork lifts, order picking trucks, etc.). In general, a single level warehouse is preferable, but conveyors and other mechanization can make a multi-level facility nearly as efficient. The excellent warehouse manager plays a proactive role in planning physical improvements.
- Automation technology: Of course, fundamentals are exactly what automation is all about. It takes manual tasks, that when executed exactly the same with best practices in mind, can do well, and uses technology to always have the process repeat and scale as expected. This includes vertical and horizontal carousels, conveyors, automatic stacker cranes, automatic pallet wrappers and many other mechanization. The forward thinking warehouse manager will periodically evaluate potential automation projects. The guiding principle here is whether any proposed automation investment in the various warehouse technology available, provides an acceptable financial return. Picking rates using a well engineered bank of horizontal carousels can be three to four times those possible from fixed shelving, transportation costs and resources are now lowered due to less errors, more control, and increased customer happiness....and finally, the accounting department, with great visibility into these processes, will love the new look of a more profitable bottom line.