Workforce Optimization is designed to address conflicting challenges facing warehouse operations in North America:
- Labor shortages – North America is experiencing a shortage of skilled, motivated, quality warehouse workers. The most recent 3PL study, sponsored by CSCMP, talks about a shortage of trained individuals to replace a rapidly aging workforce in trucking and warehousing.
- Living wage – The concept of living wage - defined as the wage that can meet the basic needs to maintain a safe, decent standard of living within the community – is placing an ever-increasing upward pressure on hourly wages. The particular amount that must be earned per hour to meet these needs varies depending on location and there is growing pressure on governments and employers to raise employee incomes to at least meet local living wage targets.
- Productivity – Engineered Standards are a twenty year old tool designed to boost warehouse productivity and force employees and unions to an acceptable level of performance. The concept of objective standards is still an excellent management tool, providing managers and supervisors know how to use it, which is a skill in itself.
- Cost reduction – the need to continue to reduce operating costs in a highly competitive market.
With all the automation and software advances that have transformed supply chain management in the last two decades, one thing has remained true: superior logistics execution eventually comes down to trained people committed to doing the right thing in the right way. If you manage a warehouse labor force and workforce optimization is not yet a strategic focus, it soon should be. Workforce Optimization strives to address all of these pressures in a way that is motivational for employees and satisfactory for employers.
What is Workforce Optimization?
Workforce Optimization is a combination of techniques, processes and technologies that address the conflicting challenges faced by warehouse operations. Properly applied and managed, workforce optimization pays warehouse employees more money, up to 20% more, while reducing overall operating costs. The steps are complex, the rewards are high:
- Implement an improved workflow process in the warehouse that minimizes travel time and maximizes the opportunity for an employee to be productive by interleaving work tasks based on warehouse geography.
- Implement an engineered-standards based Labor Management System that tracks each employee’s productivity against an objective and accurate standard.
- Implement a work assignment function that adapts to daily variations in workload and optimizes the use of warehouse employees each day.
- Add an incentive plan that pays a monthly bonus of up to 20% or 25% based on performance. Simply put, incentives will pay your best employees more money, dramatically improving your retention rate with these top performers
- Train managers and supervisors to use the tools consistently each day, to provide coaching and frequent feedback and adapt quickly to changes in workloads.
How do you begin? Contact Robocom today to discuss a list of products and services offered to help dramatically improve your Workforce Optimization, including a two-day onsite analysis of your current state!