What is Your Crystal Ball Telling You?

Nov 21, 2007 7:48 PM  By

Many of us, who are considered experts, love to talk about the future of supply chain management as if we have a crystal ball. We talk about new technologies, changes in processes, and of course customer requirements. What we don’t talk about is what you–the reader–thinks is in your future.

Who knows your customers habits better than you? Who knows your budget for new technology better than you? Who knows your processes better than you? Your crystal ball is much clearer than any expert’s. Only your crystal ball goes by another name: the warehouse.

The future of your organization lies in the hands of your warehouse personnel. You probably did not want to hear that, and you most certainly do not believe it! But your warehouse knows your customers better than any other department in your organization.

Your warehouse is responsible for receiving your product, storing your product, and shipping your product. Your warehouse has no clue of your budgets; they just know they are responsible for a majority of it, yet so few dollars are allocated to improving the warehouse. That is why so few organizations have a warehouse management system installed–lack of budget.

You know you must process your transactions more efficiently to remain profitable. You know you must attract new talent to remain a competitive. You know you must continue to attract new customers in order to remain. No crystal ball needed there. But t you continue to look for answers outside of your organization.

You have updated your accounting systems, but you continue to ship orders incorrectly. You have installed new CRM and ERP software to better manage your relationships and your front office processes, but you continue to have inventory problems.

You have produced new catalogs, created a Website, and changed your purchasing processes. But you continue not to receive product the day it arrives and returns still sit for several days without being processed. You have changed and revised your sales personnel compensation packages, but you continue to be out of space in your warehouse.

Your crystal ball is telling you that 2008 is the year you need to focus on improving your warehouse operations.

You are in the distribution business, which means the most important processes you perform are: receiving, storing, and shipping your inventory–which happens to be your most valuable asset. Until you can do those three things more efficiently, every other process you perform will continue to suffer along with your customers.

And where better to begin than with your warehouse processes? Perform an analysis of your warehouse so you will begin to understand why you process so many returns. Why your receiving is not completed the day it arrives. Why your inventory is so inaccurate. Why you are not using your current warehouse space more efficiently. And why you have the turnover you do.

The success of your organization rests on the shoulders of your warehouse personnel. That is what my crystal ball is telling me about your organization. What is your crystal ball telling you?

Rene Jones is president of Burbank, CA-based supply chain service provider Total Logistics Solutions.