THE WAREHOUSE My father, after being demobbed in 1948 from the Royal Engineers took a job as a stores superintendent at The Crown Agency in Tanganyika (now Tanzania) and then for Caltex (BAPCO) based in Awali, Bahrain. I can therefore claim having grown up in a supply house environment. I spent countless hours as a kid observing multitudes of goods, the bad and the ugly of warehouse working and management. I am probably the only person you’ve ever met who has vacuumed warehouse shelves. This task given to me by, one my father and two by various employees at the very, very, very large depot at BAPCO which engulfed not only the articles required in the offshore industry, and the oil refinery at Sitra for BAPCO but also covering many private areas of the private and military sections on the island of Bahrain. Everything (well nearly everything) back then was funnelled through BAPCO into the island. I ventured into many other line of employment, but all the various professions I undertook, be it as a Cartographer, Commercial Diving, Ocean and Underwater Engineering section or the mobile GSM construction section I always had some connection to a warehouse and/or store environments and naturally logistics and therefore decided to write an article about The Warehouses. The erratic demands of customers make maintaining a warehouse a never-ending battle, but here are a few tips I’ve found useful over the years: When I see a warehouse/stock-room my first questions I ask myself is “What does this warehouse say about the dealership and or the company? Actually, when I visit a restaurant, my first port of call is the bathroom (WC) and I also ask a similar question “What does the bathroom say about the cleanliness and operation of the place? So here are my tips for a warehouse:-
CLEAN THE PLACE
It is amazing what you’ll find in the warehouse when you just clean it on a weekly basis. Mystery inventory such as: returned goods, damaged goods and special buyouts won’t have any place to hide. Beyond the ability to move more quickly in the facility, your team will begin to develop a greater sense of pride in their workplace. Remember, this is the place where all your cash is stored. You want a team that protects your cash from the outside threats of salespeople, truck drivers, and manufacturer reps.
GIVE PERSONNEL AN IDENTITY
Your warehouse employees work with your cash all day long. Make shirts for them that say "Vault Security Team" or "Vault Management Team" or something similar that signifies the importance of what they do. This does a couple of things. First, it reminds them that inventory has value. Second, it helps identify those people who belong in the warehouse. dodie ste®eo p®odu©tion ™
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THE WAREHOUSE A key element in keeping a secure warehouse is to eliminate those folks who have no business being in there.
INCREASE THE RECEIVING AREA
When most people are designing a warehouse, they tend to cram as many racks of inventory into the space as possible. Usually as an afterthought, they carve out enough room for a little desk by the dock door, run a terminal to it and call it the receiving department. Here’s the problem: Most inventory errors start in receiving. If you make a mistake here, 10 additional problems will occur throughout the depot and the company. Start by giving them adequate room to work. You’ll see your inventory adjustments decrease immediately.
PUT SENIOR (AND/OR INTELLIGENT) PEOPLE IN RECEIVING
Why do so many companies always put rookies in receiving? As I mentioned earlier, mistakes in receiving cause multiple headaches down the line. Make sure you get it right coming in the ‘first’ door. Pay your receiving clerks well, and encourage them to stay in the position. Remember, you’ll always have more products coming in than going out. Receiving is your one place to get it right the first time so you don’t have to redo orders later because of receiving errors.
Don’t assume your newer employees can navigate the aisles. Help them out. Create colourful signs to direct them to aisles or bins. Warehouse maps are a great way to increase productivity immediately. Clearly label any and all landmarks. Try this: Ask one of your friends, associates or past colleagues to come into your warehouse and pick an order. If your warehouse is set up correctly, they should achieve a high success rate without asking questions on every item. It needs to be that easy.
ADD DESPRIPTIONS TO PICK TICKETS
Most item databases will allow you to add multiple lines of description to any SKU (Stock Keeping Unit) in the system. Use them and you’ll increase the order pickers’ chance of pulling the right product. Put in physical descriptions like "the blue one" or "two wheel." This is especially critical when you’re talking about minimum quantities. Make it clear that the "each" actually refers to the pair that’s in the pack, not to one of the two. This simple change will help you eliminate future dead stock. Don’t worry about killing a few extra trees. They grow back.
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THE WAREHOUSE DOUBLE CHECK ORDERS
A really bad motto for a distribution company is "We fix our mistakes faster than anyone else in the business." For the typical distributor, the cost to process an order is about UK£20. It costs an additional UK£50. to send it out the second time. None of us has enough margins to be able to absorb this cost on a regular or constant basis. In order to get it right the first time, install a method of double-checking using one of your seasoned veterans. This is especially important if you have new people picking orders.
CREATE COLOUR CODED LABELS
In order to make it easier for your delivery staff, develop a custom coloured label for each of your most valuable customers. Make sure every package you deliver to that customer has that label. Your drivers will be able to quickly identify those orders. You don't want to make mistakes on orders to your best customers.
IMPLEMENT “DAYS WORK IN A DAY”
Simply stated: "What is started today, must be completed today." If you receive it, it must be put away. If an order is put in the system and a pick ticket is printed, it must be picked and shipped or staged. In order to make this happen, create cut-off times. Order processing must end at a defined time. We need to give the warehouse a chance to finish the day.
IMPLEMENT CYCLE COUNTING
Most of us know what it is. Some of us recognize the benefits. Few of us have made it part of our standard operating procedures. Cycle counting will increase the accuracy in your systems. By examining inventory daily, you'll find those mystery items that have found their way to the shelves. You can correct items that have been put in the wrong place. You can rotate stock. The list can go on indefinitely. Cycle counting is penicillin for distributors because it attacks so many little problems and solves them on a timely basis. Good customer service begins in the warehouse. Sloppy procedures and a disorganized warehouse show what you think about your customers, you employees and the work you do. Pardon my rant, but a lack of supervision in the warehouse is more than a minor annoyance of mine. It’s gotten to the point that not only so many companies lack adequate supervision; they won’t even recognize supervision as a tool. That’s right, after decades of brainwashing by the “experts”, supervision has become a bad word. Today it’s all about “coaching”, “teamwork”, “empowerment”, and “self-directed teams”. So how’s dodie ste®eo p®odu©tion ™
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THE WAREHOUSE that working out for you folks, the ones doing the actual work in the warehouse and not the tea drinking administration crew? I’m not saying there’s anything wrong with coaching, teamwork, empowerment, and selfdirected teams—that is, there’s nothing wrong with them provided they don’t get in the way of effectively running a business. The problem is they often do get in the way. That’s because once you adopt these feel-good concepts, you start to build a culture where supervision and discipline are viewed negatively. The truth is most managers do not like to supervise and discipline workers. This is normal, and that’s not a bad thing. If they actually enjoyed bossing people around and disciplining them, it probably wouldn’t be a good idea to give them that power. But when you take people that don’t particularly enjoy supervising and disciplining people, and add to that a culture where empowerment and teamwork are supposed to solve all your problems, you end up with a complete lack of supervision and accountability.
THE MISSING LINK
Supervision and accountability is the missing link because without them, your business plans, policies, and procedures will not be followed. And things will gradually get worse. I’m not saying this “may” happen, I’m saying this “will” happen. Safety policies are a great example of this because this is an area where a lack of supervision and accountability is so obvious, yet this situation is common in most businesses. Why so common? Well, despite the big banner hanging on the wall that says “Safety First”, it really isn’t. It’s not even second or third. For example, let’s talk about lift truck safety. H&SE (or OSHA) requires lift truck operators be trained and evaluated to ensure they understand how to safely operate the equipment. And for the most part, companies do meet this minimum standard. Their lift truck operators understand the safety policies related to operating a lift truck. Their supervisors understand the safety policies related to operating a lift truck. Yet these policies are not followed because the lift truck operators choose not to follow them and the supervisors and managers choose not to enforce them. In my experience, this is the norm. I pretty much expect that when I walk into a warehouse I will observe lift truck operators breaking the rules in the presence of their supervisor. When you look into workplace injuries and deaths, you will frequently find that the injury or death resulted from a worker doing something he should not have been doing. And while this is then usually blamed on the worker, I would say that in most cases it is more likely the fault of management because it is very likely the unsafe act that caused the injury or death was “allowed”. That is, it is unlikely this was the first time that unsafe act occurred. More likely, this is an act that regularly occurred in the presence of managers and supervisors, yet no action was taken. So who is really at fault here? This same thing is happening with your other policies. You can do an excellent job of error proofing your processes and training your workforce, but without supervision and accountability, it will not mean a hell of a lot. dodie ste®eo p®odu©tion ™
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THE WAREHOUSE DISCIPLINE IS NOT A BAD THING
Sometimes you have to discipline a worker. This is so simple it’s somewhat ridiculous to have to explain it. If a worker knows (through training) what he is supposed to be doing yet does not do it, what else are you going to do? You basically have a person that you are paying to perform a particular task, and that person has made a conscious decision to not do the task the way he was instructed. Don’t feel bad for the worker being disciplined, they made their choice. You have to realize that by not disciplining the worker, you not only cause harm to your business, but also hurt your good employees. There’s nothing more aggravating to a good employee that’s following the rules, than having to work alongside a slacker taking shortcuts and breaking the rules and getting away with it. Worse yet, this often results in your good employees having to work harder to make up for the slacker(s). To be honest, disciplining employees is not as uncomfortable as it sounds. I’ve learned that if you make it very clear (through training) how the worker is to perform his job, and what will happen if the rules are not followed, disciplining the employee is pretty straightforward. In almost all cases, they know it’s coming, and while I wouldn’t go so far as to say it was painless, it’s really not that big of a deal. The worker should go away realizing that there are consequences for not following policies, but also that if they choose to follow the rules, everything will be fine.
ACCOUNTABILITY GOES ALL THE WAY TO THE TOP
I’ll make this simple. If a worker doesn’t do his job as instructed, he should be disciplined. If his supervisor doesn’t discipline him, his supervisor should be disciplined. If the supervisor’s boss doesn’t discipline the supervisor, he should be disciplined. Disciplining a worker for not performing his job is not a choice, it is a requirement.
LET THE MACHINES DO IT?
The lack of enthusiasm towards supervision has resulted in an industry of products that help to either monitor employees’ activities or force compliance to policies and procedures. I have mixed feelings towards these products because some of them are very useful, while others are just used as an excuse to avoid face-to-face supervision of employees, and still others are a complete waste of money because they simply don’t work as advertised. Impact switches are an example of a device designed to help to enforce safe operation of lift trucks. The idea is that the device reacts to impacts/jolts. These things have been around for decades and historically were set up so that when an impact occurs, an alarm on the truck sounds and only the supervisor has the key or code to reset the device. Damage to racking, product, and other equipment due to lift truck accidents is common in warehouses and can be very annoying to warehouse managers because lift truck operators rarely own up to the incident. So with the impact switch, whenever one of your dodie ste®eo p®odu©tion ™
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THE WAREHOUSE drivers hits something, you hear the alarm and get to run over and say “Gotcha!” Well, that’s the theory anyway. The reality is that these things go off all the time due to normal operation of the lift truck. Cracks or expansion joints in the floor, transitions between portions of the building, loading dock transitions, and debris on the floor (such as a broken piece of a pallet) can all set the device off. So the warehouse manager constantly has to run out to turn off the alarms. Eventually, these devices are either shut off or the sensitivity on the devices is adjusted down to the point where they no longer give false alarms—unfortunately they no longer trigger on many actually impacts either. It’s actually kind of funny because these things sell like crazy, but I would guess that most of them are shut off or adjusted down to a point where they are essentially ineffective within the first 60 days of use. In recent years I have seen some more sophisticated applications of impact switches that do things like log the impacts (rather than triggering an alarm) and even log the location of the impact so that if damage is found, you can go through the logs to track down the culprit. And while I’m intrigued by these more practical applications of technology, I think the need for these devices can be pretty much eliminated if you just addressed the unsafe manner in which these lift trucks are obviously being operated. So rather than being able to say “Gotcha!” to the person that just caused a bunch of damage, you avoid the damage in the first place by supervising the workers and taking action when they are observed driving in an unsafe manner. And don’t even get me started on the devices designed to prevent unauthorized employee use of equipment. Uh-oh, too late. Here’s the deal, if you tell your employees they will lose their job if they use a piece of equipment they are not authorized to use, and you mean it, and they know you mean it; they will not use the equipment. That’s really all it takes.
IT DOES NOT TAKE MUCH
My previous statement related to unauthorized use of equipment is one example of this, but I think this is a point that managers often fail to appreciate. They look at their operation and workforce and find that almost everyone is doing something wrong. They are overwhelmed at the thought of having to be constantly monitoring and chasing down all these workers to correct or discipline them, while at the same time trying to fulfil all their other responsibilities. What they fail to understand is how much time they are dedicating to deal with the results of this lack of control, but more importantly, that they don’t need to be constantly monitoring and disciplining employees. Everyone is doing something wrong because you are allowing them to. Once your workforce realizes you are serious about them following policies and procedures, everything changes. It’s amazing how easy this is to accomplish and just how fast things change.
CARROTS AND STICKS?
I’ve talked about discipline (the stick), so what about incentives (carrots)? I’m a big proponent of using incentive programs for productivity and/or accuracy/quality where workers are rewarded for performing above and beyond the base standard. But you shouldn’t need to “reward” workers for simply following the rules. For example, with safety, I don’t really see how you can have “safer” workers. You have workers that follow dodie ste®eo p®odu©tion ™
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THE WAREHOUSE the safety practices you put forth (the rules) and those that don’t. Those that don’t shouldn’t be working for you. Those that do are just doing their jobs. I think the same applies for all other policies and procedures in your organization. Following policies and procedures is really the bare minimum standard for employment. Save the rewards for something else.
WHAT’S DIFFERENT ABOUT SUPERVISION IN THE WAREHOUSE?
For the most part, supervision is supervision. However, in a warehouse environment you do have the added challenge of monitoring workers that are constantly moving around the warehouse. In most very large warehouses and many smaller ones it's a good idea to have a policy that restricts the travel of workers to only the areas their responsibilities require them to be in. This cuts down quite a bit on productivity lost to "visiting", prevents injuries that occur when people are hanging out in areas they are not trained in, and also is a big step in helping to prevent theft. It's also a good idea in these environments to occasionally stop people as they're moving through the warehouse and ask them what they are doing (assuming it's not obvious). If your workers know you do this on a regular basis, they will not be offended by it. An issue I frequently encounter in many warehouses is a result of "the boss" not being a warehouse guy (or gal). It's not uncommon in these smaller operations for the warehouse personnel to report the branch manager, office manager, or even someone in sales. These people tend to have no clue about the actual work that goes on in the warehouse and are therefore a bit intimated by it. So basically they're afraid to tell the warehouse workers how to do their jobs or to discipline them if they don't. If you're in this position, you need to get at least some basic warehouse training. You don't need to be an expert and you need to accept the fact that the people in the warehouse know more about it than you do, but that doesn't mean you can't effectively supervise them.
Supervision just comes down to making sure people do what they are supposed to do. It's really not all that complicated, but here are some pointers based on what I have learned over the years.
People can’t do what they’re supposed to do unless they clearly understand what they’re supposed to do. That’s where training comes in. Training starts with clearly documented policies and procedures. Without documented policies and procedures, you are unlikely to get thorough and consistent training, and are going to have a hard time holding people accountable because you’ll never be sure they were given the proper information. While you don’t need to cover every excruciating detail in your documentation, you want to make sure you cover the critical details and especially those aspects of the task that you have historically had issues with people following consistently.
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THE WAREHOUSE CLEARLY COMMUNICATED CONSEQUENCES
Your subordinates need to clearly understand what the consequences will be if they do or fail to do something. All violations are not necessarily equal, if this is the case in your operation, the differences should be clearly communicated. For example, a common approach for disciplining employees is a warning for the first offence, followed by a suspension for the second offence, followed by dismissal for the third offence. However, there may be some violations that justify immediate dismissal. This should all be communicated to the employees. Just the act of communicating consequences to the employees can do a lot for getting them to follow policies and procedures. In addition, it makes disciplining employees much less traumatic since everyone involves knows what is going to happen.
Training isn’t complete until you are certain the employees understand the policies and procedures. The best way to determine this is to test them. A written test not only verifies their knowledge, but also provides you with documentation that they understand the policies and procedures. So now your employees know that you know that they know the right way to do their job. Don’t underestimate the power of this. A written test shouldn’t be difficult. You’re not trying to make them fail; you’re just trying to verify that they understand the policies and procedures. Depending on the task, you may also need to actually observe them performing a task as part of the test.
MONITORING FOR COMPLIANCE
This is the “supervision” part of supervising. But this doesn’t mean you need to have supervisors constantly watching the workers. I’ve never worked in an environment where supervisors just supervised, nor do I think this is necessary. Working supervisors (supervisors that have other tasks to perform) only need to be present and alert. They don’t need to see everything; they only need to be able to occasionally look around to see if things are being done properly. This, combined with some random inspections is really all you need.
FAIRNESS AND CONSISTENCY
This is what separates the good managers and supervisors from the lousy ones. Fairness means the same violation receives the same discipline regardless of who the employee is. Consistency means that every time a violation is observed, an action is taken. That’s all there is to it.
DISCIPLINE THE ACTION, NOT THE RESULT
The natural inclination of bad managers is to have a hissy fit whenever something bad happens. Some product is found damaged due to a forklift impact, or a “big customer” calls all ‘pissed off’ about a screwed up order, so the boss gets all red in the face and disciplines the at-fault employee in a big way. At the same time, many of the other workers are doing the exact same things that led to these problems, only they are getting dodie ste®eo p®odu©tion ™
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THE WAREHOUSE away with it because the orders they screwed up didn’t result in a big customer making a big deal out of it, or, even though they are driving the forklift around like a maniac they haven’t been caught hitting anything yet. If you really want to avoid bad things happening, you need to address the actions that result in bad things happening. That means monitoring your operations and taking immediate actions when someone is observed acting in a way that conflict with your policies and procedures.
IT’S PART OF YOUR JOB
For the most part, you shouldn’t need to make decisions related to disciplining employees. If a violation occurs, it is your job to take the appropriate action, and the appropriate action should have been clearly communicated previously. There’s really no struggling with the uncomfortable aspect of disciplining employees when you accept this. You either do your job or you don’t.
DON’T BE A DICK
Being in a position of authority doesn't make you better than anyone else, and acting like it does just confirms that the opposite is true. So while people technically work below you, there’s no need to treat them like they are beneath you. Well that's it. I hope I've convinced some of you of the importance supervision and accountability plays in running your warehouse (or any other part of your business). It's often the primary difference between a chaotic mess you are ashamed to be associated with, and an orderly operation you can be proud of.
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