Set Goals – Report Results – Improve Productivity

key performance indicators, KPIs, operations and fulfillment, warehouse/distribution Center, distribution center, direct-to-consumer, direct-to-consumer operations, performance metrics, employee productivity, employee coaching, manager trainingWe believe most employees want to be in alignment with your goals as a manager, and to contribute in meaningful ways to the success of your business. But as I consult with companies on benchmarking and productivity, I find many of them don’t openly share their KPIs and results with employees.

Many don’t even have a formal, weekly process for capturing and reporting metrics. Those that do a good job of the weekly reporting often don’t have department and individual employee productivity goals and don’t publicly publish the results. But you can’t improve productivity if you haven’t measured it.

Most multichannel operations should smartly invest in material handling equipment, sortation etc. But future productivity comes from people making it happen: Handling more calls per hour, shipping more packages per hour, increasing on-time shipment, reducing error rates. Yes, sounds obvious – but take a minute and rate how well you do these things:

What’s the outcome you want? I can’t believe how many owners and managers don’t want the employees to see the results. We don’t need to show everything but we don’t have anything to hide. We haven’t taken the time to explain how business works and after we pay all stakeholders, how small a percent profit is left. And we need to reinvest in the business.

Last year, the owner of a profitable fashion company asked me to help her increase their gross margin. In the next few minutes she told me she doesn’t give gross margin reporting to her buyers. Talking to the buyers, they didn’t have knowledge of the basic retail math! What are the key drivers you want to improve? Are we reinforcing the factors we want to improve with reporting?

Report daily results. On the low investment end, hang a whiteboard in a high traffic area reporting yesterday’s production results. Examples in the DC might include packages shipped, types of errors/ inventory adjustments, or receipts processed. Call center metrics could be calls handled, abandonment rate, orders taken or – be brave – daily sales!

One client installed monitors which counted down the workload online. At the beginning of the day, the system showed the orders to be processed and as orders were shipped, the monitors showed what was left. You knew exactly the number of packages for the day and hour per employee. Are you reinforcing the outcomes you desire?

Report KPIs weekly. Clearly, reporting KPIs has gone nuts in many companies. One client challenged us to recommend the five most important KPIs in his call center and distribution operations. Excellent way to approach it! We got it to 9, covering qualitative and quantitative measures. Another client displays their 18 KPIs in the lunchroom. These compare by week, year-over-year, and in many cases are tied to their goals.

Set and post goals by department. Move beyond just reporting results to setting goals and report against what’s achieved. Year-over-year improvement is the most important aspect of measurement you can provide.

Set individual goals and post their productivity. Celebrate their productivity! In every company there are superstars across functional areas: The picker that out-picks her colleagues by 30%; the packer that consistently hits 10 boxes per hour more than anyone else. Post the entire department’s productivity by person.

Coach them. How can you help each person be more productive and deliver better customer service? Call centers with call monitoring programs do this far better than fulfillment.

Raise the bar and reward their success. I believe that we can acknowledge personal contribution in ways that aren’t always money oriented. Providing recognition and letting everyone know how they contributed is key.

Train managers. All this leads to one of the most important and often under-discussed topics.  How can we improve department lead and supervisor performance through training? Are there community college courses? Do you have an internal training plan for your key leads and supervisors? Your success is truly in their hands.

Curt Barry is president of F. Curtis Barry & Company  

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