The three most important managing points when it comes to improving warehouse operations are labour management, freight, and inventory. Shipping is the number one cost in fulfilment for any company that delivers its product to its customers, and with increasing costs of labour in many countries, businesses are only focussing on gaining more productivity per labour hour. However, there are many ways to go about labour management optimization, which not only help you gain more productivity but also help you reduce costs and improve warehouse operations.
What is labour management?
Before we discuss several ways of labour management optimization, let us first talk about what labour management means. Labour management refers to the managerial work that involves applying policies, rules, regulations, procedures, and competencies to help a business regulate and manage its unskilled, semi-skilled and skilled workforce. Now that we understand what it means, let us discuss the five ways of labour management optimization for improved warehouse operations.
In a large warehouse where there is a tonne of inventory and other supporting tools and equipment, a lot of time is spent looking for things one needs to pack and ship products. One way to improve this is by organizing workstations for each of your warehouse employees or their individual sub-teams. Employees have everything in reach, the overall clutter in the warehouse reduces, and so do the errors and delays in shipping.
When your warehouse employees spend less time looking for things, they show improved productivity. This also helps them finish work faster and take frequent breaks to get refreshed, thus improving employee satisfaction. If you do not know where to start, you can use the 5S principle to get started. This includes Sort, Set in order, Shine, Standardize, and Sustain techniques.
Labour management optimization might seem like a trivial task, but when you get down to it, it can become quite daunting. Technology is used in almost every sphere of our life now, and it makes sense to incorporate technology in labour management and improving warehouse operations too. The most trending technology being used in this area is the WMS or Warehouse Management System. These are essentially ERP systems which further fall into the category of subscription-based SaaS (Software as a Service) products.
These services help you effectively chalk out daily work hours, automate pick lists, ascertain travel routes and travel time, and even tell you how many people are enough to do a particular task. This way, you not only reduce your time spent in planning ways to optimize labour management but also become a cleaner and greener warehouse. This is because all the information generated on this system is sent to mobile readers and does not involve any paper.
One of the areas where time wastage is maximum is ‘packaging.’ The wider the variety of the products you ship, the more teams are involved in the packaging process since every product needs to be packaged differently. Packaging also involves wastage of a lot of packaging material, which, many a time, are not needed for safe delivery. Moreover, many businesses even pack products in multiple boxes when they can be packed in the same box.
Thus, one way of optimizing labour management is by reviewing and optimizing the packaging process. You can also look into greener options for packaging products since they cost less. Create an assembly line of the packaging process by having warehouse employees work at their workstations, do a small job in the long packaging process and send the box to the next person in the assembly line to work on it. This way, you can heavily optimize labour management to improve warehouse operations.
An incentivized pay structure consisting of base salary plus incentives and bonuses can help bring out a more productive side to your warehouse employees. You can roll out monthly bonuses for one worker who packed the most boxes, or one who delivered the most. There are multiple areas of improvement in the warehouse operations, and you can roll out bonuses for everyone who helps make it a more efficient place.
Your warehouse employees are the ones who spend the most amount of time in the warehouse, so it makes sense to ask them for feedback and tips. Ask them how they would like the assembly line to work or how they would like the products to be stacked on the shelves. This makes your workforce feels valued, and you can even get great advice this way. This not only helps improve warehouse operations but also boosts morale and productivity in the employees.
When all else fails, try third-party fulfilment. This step can help you optimize labour management by outsourcing the work and enabling a third-party to do it for you. This takes away from you the stress of managing an entire warehouse. These third parties help you carry out every small detail of the warehouse from order receiving, packaging, invoice generation, digital delivery of invoices to the customers, and shipping of the orders.
Third-party warehouse fulfilment may not be for every business; however, it is worth to give it a shot. Small and medium-sized businesses benefit the most out of optimizing their labour management by outsourcing it to a third party. This is because now then can focus on marketing their product to a bigger consumer base.
Speaking of optimization, see the 6 Ways to Optimize Your Supply Chain Process.