Labour is one of the biggest overhead costs in warehouse and distribution operations. Yet, most warehouses cannot operate without a host of floor staff such as packers and pickers. In the world of ever shrinking delivery windows and ever growing customer expectations, effective warehouse and DC labour management is paramount. To remain profitable, businesses are trying to achieve the highest level of productivity with the lowest headcount possible.
“Distribution center managers are under constant pressure to improve productivity as the velocity of DCs continues to ramp up. Omnichannel and e-commerce are generally making the drive for higher performance even more acute—and that’s not about to change either.
That confluence has created a pinch point that can be difficult to squeeze through on many DC floors. But it’s not impossible.” - Logistics Management
A Labour Management Software (LMS) can enable businesses to better manage labour resources. LMS is a software solution that records employee activity data from multiple sources and reports on individual and/or overall productivity levels. The system provides managers with greater visibility of where their labour costs are spent, allowing for better and more accurate staffing decision making. Furthermore, an LMS will focus on gaining efficiencies and driving productivity through scheduling and forecasting, ultimately resulting in labour cost reductions .
We briefly discuss the main benefits of an LMS below:
Maximize Performance and Labour Utilization
The LMS allows you to track, measure, report and plan labour activities within your organization to increase efficiency. You can objectively measure employee performance and identify those whose performance consistently exceeds the standard, as well as employees who might need further training.
“At the base of any labor management program is process standardization. Not the order fulfillment process in general, but the process of each task and its work requirements. More specifically, what does it take to pick an item, for instance.
The intent is to take into account all of the factors that determine the time and effort required to retrieve that item and move it to its next destination. Those work requirements can then be applied to each associate in the DC, measuring their performance of the task against a pre-set standard.” - Logistics Management
Moreover, combining historical with real-time data will allow you to better plan and forecast labour requirements to fulfil seasonal demands. For example, using industry labour standards that determine how long it should take to complete a task, the systems calculate the number of people needed to fill a group of orders, down to the number of people required on any given day, on any given shift, and even within a given zone.
In addition, visibility tools provide real-time data on actual employee utilization and performance versus established standards, allowing you to detect inefficient processes and take corrective action. You can also reduce unproductive activity and its associated cost by tracking indirect labour.
Once a shift is underway, the system will monitor not just the performance of individual workers, it will also monitor the overall performance of the facility according to the planned workload for that day.
Enable a Self-Directed Workforce
The software will allow you to create individual performance standards, enabling each employee to understand what is expected of them, as well as giving them the ability to track how they are performing against that standard throughout the day.
Employees empowered with performance indicators take greater ownership of their own work and benchmark their improvement!
“Forward-thinking organizations are using labour management to simulate the impact of changes to materials handling systems and processes, like a new conveyor, sortation system or pick line, on labour. Slotting tools, for instance, look at the demand for products to determine the best location in pick faces and storage areas for each stock keeping unit (SKU). By running the slotting plan through a labour management planning application, a manager can calculate whether the benefit from reslotting is worth the cost involved in moving the product.” – SupplyChain 24/7
Get the Most Out of Your WMS
Warehouse Management System (WMS) is a software solution that helps control and manage the day-to-day operations in a warehouse. It offers inventory visibility and manages end-to-end supply chain fulfilment operations from distribution centre to store shelf.
Although an LMS can be run on its own, integrating it with your Warehouse Management System (WMS) provides you with a much more comprehensive labour management and planning solution.
iWMS Australasia utilizes HighJump technology, a solution that can be scaled and tailored to meet any business needs.
Contact us today to discuss your business requirements.
Click here to download the full HighJump Labour Management Solution brochure.