Is Tribal Knowledge Impeding Your DC Operations?

warehouse, distribution center, ecommerce fulfillment, picking and packing, pick locationWe all know the value of our employees, department and senior managers to our businesses. Within most warehouses you can find dedicated, long-term staff. These individuals can most likely tell you exactly where most SKUs live in the warehouse, which vendors have the most compliance issues, and who the fastest pickers and packers are. This type of tribal knowledge is what makes things click.

But for many companies, a negative form of tribal knowledge is a detriment to the short term and long-term health and productivity of a company. Here’s an example.

Recently we worked with a hard goods wholesaler that needed to consolidate two warehouses into one. When laying out the project plan, it was quickly determined that 3,000 SKUs were going to take about 60 days just to move. This was because only two or three individuals could identify where SKU were.

This was further complicated because systems in the old warehouse were antiquated, with 25 to 30 SKUs stocked in each pick location. There was no barcoding to assist with the process, and product descriptions were insufficient. The process would have been much faster with multiple teams to identify, clean, move and put away merchandise into newly labeled stock locations.

Just so we’re all on the same page, tribal knowledge is any unwritten information that is not commonly known by others within a company.  It is undocumented and handed down to new workers verbally. While it’s of great value to businesses, it can work at cross purposes with your organization, processes and IT systems.

Here are some other examples of tribal knowledge we run into in DC operations:

Locating stock: The stock locations are hidden away in people’s minds (“This is where I saw it yesterday”) rather than in the fulfillment or WMS system. There is no bin/slot location labeled on the racking and storage systems. This makes it hard to add new employees to stock functions, especially pickers. And if items are moved and people don’t keep up with the new locations, picking errors occur.

Receiving: If only certain people know your vendors, compliance policies and product assortment, the lack of process and procedures may make it difficult to receive products when staff is added, leading to long dock-to-stock times.

Managing inventory and locations: Without stock locations, there is a lack of flexibility in terms of slotting new receipts and managing cubic storage.

Inventory accuracy: Cycle counting will be difficult without barcoding of products and stock locations, meaning you have to rely on people’s memory for inventory locations.

Picking: If picking documents and customer orders only have an SKU number or short/long description rather than stock locations, picking will be more error prone.

Lack of written procedures: Without this, no one is doing the process or tasks in a uniform, acceptable manner. When no one else is able to perform that task or process, how will your company manage when the walking data repositories are out sick, take a vacation or quit?

Companies must harness tribal knowledge and use it to their advantage, but they can’t be held hostage by it. In that case, you open yourself up to serious financial risk and negatively impacting your customers.

Take these steps to eliminating the downside of tribal knowledge:

  • Identify areas where processes are built around people, instead of people adopting acceptable processes and systems;
  • Get employees to buy into the benefits of formalizing and adopting procedures and common systems;
  • Make sure managers get involved and approve the outcome;
  • Set goals, priorities and schedule time for the project;
  • Be sure to disseminate the knowledge to others so people can see the value to the company.

Don’t get overwhelmed with trying to do everything at once. Identify areas where you can realize the greatest, quickest benefit or reduce the most risk.

Curt Barry is president of F. Curtis Barry & Company

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