Why Distribution Centers Lose Thousands of Hours Yearly on Unproductive Work

posted on: Thursday August 29, 2013

DSC_6717Last year, Intermec released research on the greatest challenges facing warehouse managers and how many hours of productivity their employees are losing every year. The results are staggering, the reasons surprising, and the solutions reachable.

Small to medium-sized warehouses with 50 workers were calculated to lose around 3,000 hours every year.  Larger corporations lose even more. These hours are hidden in small increments during each employee’s shift. The results showed that each employee loses about 15 minutes of productivity per day when the workflow process is inefficient. This may seem insignificant, but in the long run, it makes a huge impact. Intermec reported, “Nearly two-thirds (60%) [of managers] agree that ‘Large time and cost savings opportunities can be found in gaining back mere seconds in operations workflows.’”

Managers face a number of challenges. As for cost-savings, looking at the minutes their employees lose will make all the difference. Intermec Industry Marketing Director for Distribution Center Operations Bruce Stubbs said, “Warehouse managers are faced with significant cost saving challenges, which means they can’t afford to let such levels of time wastage continue. Businesses should be looking at every workflow in detail on a regular basis to claim back the minutes and seconds they need to achieve these savings.”

With workflow being such a key to success, it is surprising to learn when and why managers conduct a review of their productivity. In the case of the research, thirty percent of the companies had not carried out a review in the previous year, and the rest had. Of those who had not, many reported that their only motivation to do so would be compliance and/or poor worker performance. Even more surprising, one in five companies said they would only review their workflow productivity if they receive a customer complaint. Of those who’d recently carried out a full review, most said their motivation to do so were continuous improvement efforts as well as compliance; poor performance did not play a significant part in reason to evaluate. Something to remember here is that when looking at things that world-class facilities do, the overwhelming majority have continuous-improvement plans in place.

Solutions

There were several areas that managers agreed need improvement. Amongst these, there was one main consensus within the group: “the overwhelming majority of managers (89%) said they believed investment in new technology would enable them to claw back their lost time and ensure greater worker productivity.” New technology comes in many forms. An article based on the Intermec research, Premier Handling Solutions’ “Five Ways to Invest in Your Warehouse,” discusses them. Premier lists inventory management systems, ergonomic equipment, workplace organization, pallet racking systems, and warehouse safety education as the most prosperous ways to improve productivity. These ideas also follow the trend that managers feel the areas in most need of improvement are packing, loading, picking, and inventory control.

It is no coincidence that the most successful companies are those who review their workflow process and implement changes as part of a continuous-improvement initiative. If less successful warehouse managers operate under a “If it ain’t broke, don’t fix it” mentality, they may want to reconsider their definition of “broke.” Investing in warehouse operations to improve productivity doesn’t just create more work completion. It improves morale, increases safety, and leads to lower costs on things like insurance and worker absences. Overall, this contributes to the success and longevity of the company as a whole.

Load Movers Inc. builds power tuggers that are used by many companies to eliminate time wasted and improve overall flow in the workplace. If you’re looking for cost-savings solutions in your manual material handling company, search this website, email info@loadmoverinc.com, or call 952-767-1720 for information on our products.