The new challenges of distribution centers

Introduction

The attraction and retention of professionals by compliance with legal requirements, through constant pressure for productivity, managing a distribution center in the current business scenario is an increasingly challenging issue. What is the real productive capacity of my distribution center (DC)? And how to increase it when there is a shortage of professionals in the market? What are the most productive workers in each process?

This article aims to address these issues and to explore the potential of information technology as part of the response.

About the CDs

Rare are the professionals who, working in the field of logistics, never heard any hint about materials storage are a “necessary evil”. Now the Ballou himself (2004) states that “To achieve perfect coordination between supply and demand, production would have to respond instantly and transport would have to be perfectly reliable, with zero time delivery. This is not available for a company at a reasonable cost. Consequently, firms use inventories to improve the coordination of supply and demand and to reduce overall costs. “

The same Ballou (2004) notes that “A company uses the storage space for four basic reasons: (1) to reduce transportation costs and production, (2) to coordinate supply and demand, (3) to assist in the process production, and (4) to assist in the marketing process. “What we have observed is currently the most advanced in its logistics management companies are increasing the focus of the administration of their CDs in items cited by 3:04 Ballou as a way to be able to generate value from their CDs consistent Banzato (2003) to argue that “in an effort to meet the new challenge of storage, warehouse operations are changing. Distribution centers assume a broader perspective, allowing them to see that the client is a real person and that increasingly demands more quality services. “

And in his company, the CD is a problem or is it a key part of the corporate strategy?

But if the need to maintain inventories leads companies to build warehouses and / or distribution centers, desired or not, the fact remains that these need to be managed in the best possible way. And this goes for adding value-added services to improve customer service, reduce costs and thereby transform the CDs cost center into a mainstay of the business strategy.

The issue of labor

A recurring theme is the lack of manpower to work in warehouses, both at the operational level as for specialized functions.

On one hand, the steady economic growth of the country generates, the consequent growth of businesses, a natural increase in demand for labor. Have the other hand, increased education of professionals and the most diverse range of job options are very difficult process of hiring and retaining people for the operational functions, which is disturbing and often costly.

The management of labor is becoming one of the major difficulties in their day to day?

This time, companies are facing the challenge of attracting and retaining good people, without overburdening their operating costs. And it should be emphasized here the importance of “retaining” in this equation. We know that every entrant has a learning curve, low productivity and a greater chance of errors during training and adaptation to the new company, so the turnover is high, has important impacts on the costs of the company and the customer service .

The turnover of people has affected the productivity and performance of your operation?

Some companies have passed the offer more attractive salary packages and benefits in order to attract and retain professionals. If, on the one hand, this approach has been adequate from the perspective of people management, the same can not be said from the perspective of the customer – after all, it is he who will pay for the higher cost, and in exchange for what benefit ? Thus, this simplistic way of tackling the issue has not been the most efficient, since it entails the loss of competitiveness of the company in the market. It is imperative that the solution is more even, which also provides benefits not only increased costs.

One solution that some other companies are adopting to this dilemma is the variable remuneration for productivity both as a motivational factor to reduce employee turnover, how to encourage increased productivity. This form of compensation is based on setting goals and measuring their achievement, individually and collectively. The search for additional slice (variable) income by operators is causing an increase in productivity that offsets the additional cost generated by equities. A typical win-win, in which the company becomes more attractive by offering the possibility of greater income – since the worker earns with variable income and meritocratic, and the client, with the increase of productivity.

With variable pay, employees are motivated to perform its tasks, as it will be fairly rewarded according to their performance. This model also reinforces the innovative and bold profile sought by companies in their employees.

But, although this form of compensation can bring great results for the operation, there is the challenge that is fair to all employees, failing to generate an opposite effect to that desired: demotivation and low morale, by discrediting the variable remuneration system.

The challenge is: how to measure the productivity of warehouse activities fairly?

Analyzing Table 1, for example, what operator performs better and should be better paid?

While it may seem obvious to some that The Contributor has produced more, those who have or have had responsibility for managing a CD know that is not so simple. Can not indicate which of the operators was more productive considering only the above information. It is necessary to evaluate the difficulty of each operation, the size and weight of the items moved, distances and any physical restrictions on each desktop. The format of a material itself can make it easier or be handled and accommodated complex.

This is the great challenge and a key requirement in the variable remuneration for productivity: be able to create appropriate goals and measure them fairly, creating the effect of win-win – the more the operator earn, the more the company will benefit.

To get to the fair result in the analysis, we need to identify some parameters such as the desktop, type of equipment used, the item weight and volume, distance to move products and features that can negatively affect paper handling.

According to HighJump Software, based on results observed in its customer base, efficient management of labor and the use of variable remuneration bring increased productivity by 45% for companies.

To measure this productivity with more precision and greater justice, we must have the support of information technology, and for this there are already specialized systems, known as LMS (Labor Management System, in translation, System Manpower Management).

According DESTRO (2011), the adoption of systems for Labor “Management provides a significant improvement in operating performance because it allows a standardization of the best methods for implementation of activities and encourages better use of real-time use of hand labor for tasks, and allows to define the allocation of the right person at the right activity at the right time. This means producing more with less.”

The level of precision and detail with which these tools are able to collect and process the data from the shift of each employee is very high, making it possible to obtain the results mentioned. As an illustration, Figure 1 shows the activities performed by an operator from the point record at the beginning of the turn (clock in) through execution of each activity, downtime and lost time (idle) to the output register (clock out).

With this kind of tool, you can measure the performance of each operator, identify idle times, conduct comparative between them fairly, performing analysis and taking actions which increase productivity and improve the performance of the warehouse. After all, the CDs also holds the famous maxim of management: if you can not measure you can not manage.

Source: http://www.tecnologistica.com.br/

Comments are closed.