How productive is your current warehouse?

Warehouse managers are responsible for ensuring their staff are always performing at their best. Software can be used to set objectives for various warehouse tasks and then measure performance against those metrics. Statistics can be easily recorded through the software while employees perform their daily work without imposing any additional input from them. Simply knowing this is happening will create an instant uptick in the staff performance. These statistics are Key Performance Indicators (KPI) for management to evaluate each employees’ individual accomplishments and the company’s overall performance, which will lead to improved output.

What are Key Performance Indicators?

KPI’s are the measurable tasks companies chose to compare how well each employee is performing. Comparing the results amongst staff provides information on how to maximize output. The statistics are used by management to set benchmarks for everyone in each of the chosen task areas. Evaluating these results regularly will tell management how well each member is performing their job.

Setting standards for output will ensure that the business is as competitive as it can be within each operation. These statistics can highlight the weak points in the business, whether it be a process or an individual employee. From there, management can take corrective action and implement training initiatives.   Benchmarking will lead to increased productivity and reduced operating expenses. It will drive better performance, increase efficiencies and improve customer service.

Setting the standards

Once the organization wide KPIs are in place, it is important to implement individual performance metrics (standards) which support the KPIs. These standards should be specific to all employees depending on their assignments and shifts. The standards are then communicated to the employees to ensure they know exactly what is expected of them. The results can be used to acknowledge those achieving or exceeding their objectives providing a sense of pride for a job well done. Staff can strive to continue improvements in their results reaching higher standards for themselves.

This leads to overall increases in the benchmarks for everyone. Reward systems can also be put in place to further encourage excellent performance. Implementing standards will cover a variety of intended outcomes to a scale that will cover every complexity of the operations. It is an evolutionary process that starts with forming a historical baseline for performance.

Effective Management

Using KPI’s and setting standards helps a manager do their job better. Information gives them a clear picture of what is happening in the business. This information shows them the obstacles which they need to address and overcome. Good managers will thrive in this environment and find creative ways to change operations for continuous improvements. One of the most vital aspects of getting more from your labor dollars is the effectiveness of your managers.

KPI’s give managers additional responsibility to not only manage staff, but responsibility to be on the lookout for ways to reduce cost and improve customer service. Each part of the operation can be broken down into cost components to determine how expenses are spread across every order. Improvements management makes will take the business to higher degrees of competitiveness.

Whether your objectives are to become the best warehouse, or simply make small improvements you should consider establishing standards for common warehouse performance metrics.