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WAREHOUSE TRANSFORMATION
CITT WEBINAR SERIES
Date: Wednesday, March 30, 2016
Time: 12pm EST
Hosted By: Tim Buchinski, CCLP
ANALYTICS
As a business, you have probably been able to generate more data in the past year on your current performance as well as future predictions. How are you able to determine what data makes sense or is value added?
You need to clarify, what is the intent for Analytics, what is the consistent message on National Data?
Dashboards & K.P.I.`s need to be developed and implemented so that the Sr. Leadership of your business has visibility to the current “Health Check” or status of your operations.
It is important for you to understand your audience that drives your specific KPI`s.
When I say this, what makes a real impact for them to change their own behaviors to drive improved performance. Visual Management Boards with a Green, Yellow and RED indicators will allow them to work on specific items that need immediate attention.
ANALYTICS
What are the specifics that influence productivity? ▪ Common theme is as volume increases, productivity increase?
▪ How do you curb reduced productivity with a drop in volume?
Key Performance Indicators (KPI`s)
▪ How do you know when you are paralyzed by data?
▪ How do you study the data and capture the opportunities?
▪ What measurements are in place to ensure that your improvements are not impacting other facets of the operation?
ANALYTICS
What Opportunities Exist In Labour Standards continued……..
How can you overcome these obstacles or road blocks?
How do you educate your Management staff on the basic influences of labour standards and how they may affect your business performance?
▪ There are 2 basic components on productivity or performance improvements. They are the number of times you touch a product and the distance being travelled from “A” to “B”.
▪ Your first priority is to address all of the fixable problems first which is key!
▪ Obstacles are empty pallets in the aisles for assemblers to move around, dunnage removal from pick slot locations, poor sanitation practices, Inventory Control - sku alignment based upon family groupings/velocity, XYZ coordinates, M2R/MOQ settings, Direct Labour SOP`s – Management staff need to be fully engaged in understanding the activities required in every labour function.
ANALYTICS
What Opportunities Exist In Labour Standards?
The following Engineered labour Standards of direct labour components are based upon the following:
Standards are based upon 100% expectations
There is a +/- 5% deviation or tolerance level given to the standard
Minimum expectation drops to 95% to Std
U= Distance Travelled
V-Variable Horizontal Speed Of MHE
W= Required Number Of Case/Pallet Pick
X = Time Required To Pick Cases/Pallets Based Upon Weight/Size/Location. There are many additional Dynamic Variables
Y= Pallet Wrap Plus Stage Time. There Are Other Allowance Given For Personal Time As Well As Other Dynamic Variables.
Z= Time Required To Perform The Task
Equation: (U * V) + (W*X) + Y = Z
ANALYTICS
What Opportunities Exist In Labour Standards continued……….
▪ Now that you have this data of expectations, what would be your next step for evaluation of your current K.P.I.`s?
▪ What if you don’t have labour standards in your facilities?
You have an opportunity to set minimum expectations based upon your Direct labour functions.
For Example: Assembly –Colleague has a schedule of 8 hrs. per day. You would also have the following static down time(depending upon your facilities structure) 30 min lunch, 2 - 15 min breaks and Start/End of day equates to a total of 10 mins. The colleagues actual uptime equates to 410 mins(6.83 hrs.) of actual uptime, minus any and/or personal delays they may occur during the course of their shift. (example of delays personal time, speaking to management, accidents/incidents, etc.)
MINIMUM EXPECTATIONS - INCENTIVES Current
Volume 5,000
On Std Time (minutes) 410
Current Actual Cs/Hr Picked 150
Labour Requirement (hrs) 33.33
# of Employees Required 4.88
Hourly Rate 15.00
Total Cost $499.95
Incentive
Volume 5,000
On Std Time (minutes) 410
$0.05 For > 1,025 1,025
1300 Total Case Pick Day 1,300
Extra Cases Picked (per emp) 275
Actual Cs/Hr Picked 190
Labour Requirement (hrs) 26.32
# of Employees Required 3.85
Hourly Rate $15.00
Incentive Costs $52.94
Total Cost $447.74
Net Savings of $52.21
Minimum Expectations – Incentives Further additional savings: • Fringe • Labour Rate • Reduction of required MHE • Reduction in required
maintenance of MHE • Reduction of depreciation costs
on MHE. • Improved retention strategies
COST
Managing cost is skillful control. Choosing when, where, and how to allot our improvement cost dollars.
Process Standardization
▪ Supply Chains require a base operating platform to operate from.
▪ What are these elements of Process Standardization? And Why?
Planning vs Reactionary – Preparedness
▪ Labour Schedules Aligned To Retail Support
▪ What are your predictive swings in volumes
COST
Planning vs Reactionary – Preparedness
▪ The value of Forecasting & Labour – Daily Performance Debriefs
COST
Planning vs Reactionary – Preparedness
▪ The value of Forecasting & Labour – Daily Performance Debriefs
COST
Planning vs Reactionary – Preparedness
How Do You Handle Peaks And Valleys In Volume For Your Business?
▪ Do You Have Capacity Constraints In Your Facility?
▪ Establishing & Maintaining Relationships With Category Managers or The Replenishment Group
▪ Fast Moving Product/Articles – Setting Up Flow Lanes
▪ Maximizing Full Pallet Pick (FPP)
COST
Workload Balance and Setting Realistic Expectations
▪ Management behaviors – proactive vs reactive
▪ Why is it important to have daily Supervisor “Task Lists”
▪ How do you align this with your Compliance programs
COST
Inventory Control
▪ Importance of having a required skillset to understand root cause analysis of Inventory gains/losses
▪ Receive Inventory – The importance of handling excess Vendor PO/ASN Sku`s that are required for SL
▪ T-Zone Management
▪ Whse Damages
▪ System maintenance for Article settings
Maintenance & Capital Expenditure
▪ Third Party vs In-House MHE R&M
▪ Capital Expenditures – Improvement cost dollars
▪ Building Maintenance Program
COLLEAGUE
Colleagues are the cornerstone of a successful business. Motivation is derived from faith in your leader, pride in your workplace and enjoyment and fulfillment in a successful days work.
Employee Diversity
▪ How do you support Employee Diversity within your workplace?
Employee Health and Welfare Areas
▪ Does your facility currently support the needs of your business and future growth?
COLLEAGUE
Employee / Management Engagement
▪ What activities are in place for your valued Colleague?
▪ What are the watch outs for engagement?
Colleague Training
▪ Frontline Supervisor Training
▪ What value does X-Training your employees have for your facility?
CONCLUSION
1.) Analytics – understanding or Interpretation of the data that presents itself and how you are able to action items for performance improvements.
2.) Costs associated to building performance.
3.) Education and training of your Colleagues.