Is your warehouse pulling its weight?

When James Brindley constructed the first canal in 1763, he could not possibly have imaged the impact the new means of transport would have on the economy.  The roads built by the Romans nearly 1500 years previously had fallen into decay, and in wet weather the tracks were quickly reduced to rutted mud.  To move heavy loads over the hills packhorses were used.

Now the interesting fact is that a packhorse can carry about 130 kg.  With a cart a horse can pull two tons, yet pulling a narrowboat a singe horse can move a payload of 30 tons.  This means that one narrowboat was the equivalent of 250 horses. The Bridgewater Canal transported coal from mines in Worsley into Manchester, a relatively short distance of 10 miles.  Yet the impact was huge; the price of coal was halved at a stroke.

Now you may ask, What has this to do with managing a warehouse?  The point is to consider whether there is anything today that can have the same impact in the warehouse as the canal had to transport.

What characterises the life of todays warehouse manager   There are consistent pressures on the despatch side to deliver more quickly, more accurately, and more frequently.  On the supply side imports are increasing, which leads to the opposite trend for larger quantities and longer lead times.   Stock arrives in containers rather than on pallets, and needs to be palletised before it can be put away.  What may have been considered good service a few years ago is no longer acceptable.

Just as the Duke of Bridegwater was willing to invest in new technology to reduce costs, and improve delivery timescales, the same principle applies today to the warehouse.  If the modern manager is willing to invest, the returns are high.

A few rules for better warehouse management. 

Rule 1: If you are still using paper in your warehouse, stop now.  Paper systems cause delay, are prone to error and do not allow sufficiently quick updating of systems data. 

Rule 2:  Do not ship stock that is not yet properly booked in. Many companies have stock in their warehouse but cannot ship it because it is not on the system, so they circumvent the system, and ship it anyway, because it is urgently required. This creates many sources of potential error both for costing and stock levels.

Rule 3:  Other than in a very small warehouse, do not believe anyone who says that stock rotation can properly be managed in someones head.  This is not to say that someone cannot remember where stock is but there is no guarantee that that someone will be there when required.

Rule 4: If you think that scanning bar codes will slow the operation down, think again.  With a paper system the operative carries the paper pick note. Before they pick they have to put the paper down, after picking they have to tick it off the item or change the quantity. Scanning will be much quicker.

Rule 5:  If you are already efficiently using scanners in your warehouse think about the next stage.  Could voice/speech systems speed the process further?

Hopefully, not many of you are using warehouses built by the Romans. What is surprising is that many companies have invested in new warehouse facilities, new racking and new trucks, but often have not thought much about systems. Relative to the total costs of a warehouse facility, the cost of a reasonably sophisticated warehouse management system (WMS) is quite small, maybe only 5% of the total, yet the benefits can be huge.

Earlier on I mentioned that the canal halved the price of coal in Manchester.  We have examples of companies who have doubled the throughput after implementing a new warehouse management system.  Doubling the throughput sounds much the same as halving the cost.  So you could say the warehouse management system is the new narrowboat.

Accuracy also improves.  One of our customers supplies B&Q, who carry out random audits of their deliveries and recently they had 30 consecutive weeks of 100% accuracy.

A modern WMS completely removes paper.  No queues outside the warehouse managers office.  No lost documents.  No manual input of receipts, despatches and warehouse movements.

With a paperless system stock is updated immediately. No waiting until the system is correct, or suffering the consequences of shipping stock not yet booked in.

If you have been using scanning for some time, and want more benefits then consider a speech solution. Conversation is the most natural form of communication.  Speech systems enable your warehouse personnel to communicate with the WMS directly, by listening and speaking via a headset connected to a terminal worn on their belt, and revolutionises the way they work.  Speech delivers significant benefits for the workers, and performance improvements for the company. It frees the operatives hands allowing him or her to work faster without working harder.  Moreover, use the speech means that the operatives eyes are focused on completion of the task in hand and not moving from terminal to warehouse bins, helping to further improve accuracy.

Still sceptic.  I suppose there were some doubters in the 1760s when James Brindley dug the first spadeful of earth for his new canal.  Yet canal transport fuelled the industrial revolution, and led the UK to be world leader in manufacturing.  A powerful WMS will equip your warehouse to pull its weight, and help your company be a world leader.