WAREHOUSE MANAGEMENT: Does Expansion Always Mean an Increase in Manpower Headcount?

Involve your Crew in Planning (courtesy of google.ph)

As I always advice my clients, always look at what you have and see what is its True Capacity and if one is using that True Capacity in an efficient way.

Take for example the manpower in a typical Warehouse.  Normally, the reasoning would go like this:  If my warehouse crew of 5  can handle 1,000 cases a day of Outbound shipment, then a ten-fold increase in Outbound volume could mean one will need about 45 more people.  Not always true as one should consider the following:

1.  DETERMINE WHERE YOU ARE COMING FROM.  Is the existing crew of 5 operating at their maximum, or can they handle some more volume?  How much more without losing accuracy  in picking stocks for delivery & delays in loading of trucks?

2.  To minimize Peak Warehouse Workloads at any one time, schedule the receiving of Inbound goods at a time when there is a slack in the warehouse i.e the time between the loaded trucks have just left and the time when they have to prepare for next day's delivery.  ( Your supplier will always agree to your requested Delivery Time as he wants to sell to you!)

pallet jack image courtes of google.ph

3.  Do the existing warehouse crew have enough Material Handling equipment such as pallet jacks, forklifts and other handling aids or do they have to share thereby increasing waiting times?  (It is better to have an excess of Material Handling equipment than an excess of manpower.  During lean months, the former does not cost anything more but extra men cost money whether you use them or not and it is not easy to reduce them without risking labor problems.)

4.  Review the whole warehouse process from Receiving, Putaway, Picking, Issuing, Replenishment and Loading and implement WORK SIMPLIFICATION and minimize redundant work steps.

flowchart courtesy of google.com.ph

5.  Whenever possible, AUTOMATE.  I do not mean you buy an SAP P35-Million WMS (Warehouse Management System) software but you may have to invest in a simple Inventory Program that allows bar-coding.

             Aside from being more accurate and tamper-proof, a simple Inventory Program (maybe P30,000 ot P50,000 or US$1,000) and bar-coding will make the process of Receiving, Putaway, Replenishment, Issuing etc a lot faster by freeing the Human-Intervention part of the process (the slowest in any Workflow). 

barcode scanner courtesy of consumerschoicepos.com

Ex In Receiving goods, the warehouseman and checker individually have to go around the pallet and look for the product description on the upended carton, compare that to the supplier's invoice & put a tick mark (vs scanning the barcode in less than a second)

barcode by 

mperfect.net

4.  When you add manpower, this is what happens:

        4.1 You increase the complexity in supervising so many people.  You may now need Warehouse super-
                   visors to break-up management;

        4.2  You can lose the Team Spirit and Camaraderie as now parts of your Staff may feel alienated as
                   of course, you cannot talk personally talk to everybody daily;

        4.3  Your instructions used to reach your crew immediately but now it has to cascade to a few levels
                  and misinterpretations do happen.

5.   The most neglected step when planning for a warehouse expansion is to involve your warehouse crew (or the involved parties), to wit:

        5.1  Advice them of management's plan, the timeline of implementation and what exactly is the impact
                 or what does it mean to them;

       5.2  Tell them in clear and concise terms the problems that will result from the expansion but you do not
                have to present it to them in a threatening or negative way.  You can call the expansion an
                Excellent development for everyone and problems are Key Result Areas to ensure success;

      5.3  Lastly, ask your warehouse for suggestions and for good suggestions, include them in your plans &

               be sincere in giving credit to your Warehouse crew.

Involve your whole Supply Chain courtesy of google.com.ph

6. Involve all parties in your SUPPLY CHAIN including your suppliers.  For suppliers, you could:

      6.1  Schedule shipments to your warehouse during slack periods (as mentioned above)

      6.2  Minimize Final Packing on your end.  (Preferably goods arrive in your place ready for delivery to
               your customers. No Repacking, no  stickering for promo events, attaching of price tags, no bundling
               at your end etc)

      6.3 For your bulk customers, arrange for your supplier to delivery directly to your customers using
              your Sales Invoice (saves handling cost and avoid double-handling)
I am sure you could easily add to the List .  It is only when you have exhausted all the above that you may really have to add men but only just what you really need.

By the way, I would like to invite you to visit my Sulit Homepage as there are some business opportunities that you guys might be able to help me out with.  If you are interested, just click the Sulit Logo below: