Lack of consumer confidence and a slowdown in spending have begun to hurt catalogers. After years of double-digit growth, in recent months many companies have laid off employees, and the squeeze to improve profits is well under way.
Now management needs to raise productivity — do more with less. Everyone must work harder — right? Wrong! The solution is to work smarter, not harder. Though working harder may show short-term gains, it cannot be sustained in the longer term. Smartness is the key to productivity improvement. Start by asking your employees for ideas to improve processes; measure productivity; prepare daily staff schedules; and train employees well. Your reward will be a smarter, more productive operation.
A better way
Don’t rely solely on outside consultants or industrial engineers to streamline processes. Instead, ask your employees for ideas. If you want to know how to pick faster, ask your pickers. Want to pack faster? Ask packers for their input. People who do their jobs day after day are the best experts. Get everyone involved and let them know that not only is it OK to change, but that you are actively looking for changes that improve processes.
Examine process steps and make individual determinations on each. If it’s not absolutely necessary, get rid of it. However, don’t allow shortcuts that reduce quality or sacrifice safety. Management’s job is to listen to employees, to question everything, and to be on the lookout for opportunities to make improvements.
Work measurement is crucial to managing and operating a smarter fulfillment center. Measure and report individual employee productivity on a regular basis. Employees need clear expectations, standards to meet, and management support. Improvements in this area can pay large dividends: Productivity gains of 20-30% are possible.
A good work measurement system must be updated regularly to reflect changing practices and procedures. The system must be equitable and the standards must be perceived to be fair. Standards should be developed with employee input, then tested and retested, since the best-engineered systems will fail without employee acceptance. Integrate work measurement with payroll and your WMS to reduce the amount of manual entry and improve accuracy.
Front line operations management must adopt and champion the system as well as review and test the data. Managers must learn to use the system as both a planning tool and a report card for employee performance. A good work measurement system will provide a framework for continuous productivity improvement.
The next step to working smarter is to schedule your staff properly. Call center managers are years ahead of DC management on scheduling techniques and tools. Most DCs do a poor job of scheduling. Their staff is semi-fixed and does not vary with daily production. Having too many workers scheduled can eradicate the best productivity program. Having too few workers can result in poor service and unacceptable backlogs.
To avoid these problems, develop schedules with employee input. Review your company’s employee policies to determine their impact on scheduling. Any restrictions on guaranteed hours, department transfers, use of part-time or temporary workers, or overtime should be built into the schedule.
At a minimum, accurate scheduling requires quality projections for receiving, returns, and orders. Management must define service goals such as merchandise turns, order fulfillment, and acceptable backlogs. Don’t take this lightly. Unless you’re selling one-hour photo processing, not all customer orders need to be processed immediately. A well-managed backlog can provide productivity gains and still produce great customer service.
Now, crunch numbers — take your workload projections, service goals, and job standards, and calculate staff requirements to produce a daily schedule. Don’t forget to monitor your schedule for accuracy. Sound easy? Not likely. Given the complexity of scheduling catalog fulfillment centers, many companies seek outside assistance. At Nordstrom’s fulfillment center, we got help from Don Cook & Associates (www.cookpep.com) and implemented their Productivity Evaluation Program (PEP), which integrates work measurement, staff scheduling, quality control, wage incentives, and budgeting in one program. According to Cook, the average productivity improvement results in a project payback of less than 12 months.
Another key element in working smarter is effective training. Just having a trainer on staff or a formal training program does not guarantee success. Training is a means to the goal of performance. Training is particularly important for new employees, during start-ups, or implementation of new procedures.
Good trainers can break tasks into small “bites” that are easy to learn. Checklists, road signs, reminder lists, and other job aids are all around us. They help us work smarter by reminding us how to do things we already know how to do. Good job aids can help improve both productivity and quality.
Trainers are responsible not only for building skills but for improving self-confidence. Employees must be able to practice what they learn. Self-confidence is important because employees must believe that they can perform the skills on the job without embarrassment or humiliation.
Jeff Kline, founder and president of Kline Management Consulting (www.jklineco.com), has over 20 years of experience with companies such as Nordstrom and toysrus.com. He provides operations assistance for catalog and e-commerce companies. Kline can be reached by phone at (901) 850-0645 and by e-mail at email@example.com.