If your company is like most, labor cost eat up a big part of your bottom line. Unlike raw materials and utilities, human productivity is very hard to get a handle on. Managers tend to judge the human element with a mixture of intuition and hearsay. But there are better ways.
With the appropriate technology, you can manage the people in your organization in concrete ways, no matter what size your company is or what industry you are in. Using a Labor Management System (LMS), you can identify problems, monitor productivity, and give appropriate feedback in all areas of your warehouse, and using the same system, you can find out exactly where most of your expenses occur.
Finding Out How Long It Really Takes to do Something
Finding out how long it takes an employee to walk from one area to another and how long it takes to pick and pack a product helps companies to pinpoint how they can improve. This can be done without hiring an industrial engineer to sit and watch. Data can also point out which employees work well together and which don’t, something they might not tell you.
How Will It Affect Employee Relations
Surprisingly, using LMS systems turns out to be union-friendly, according to Bridget McCrea at Logistics Management. It is less invasive that having a supervisor or industrial engineer hanging around writing down what an employee is doing and how long it takes. Occasionally it uncovers some easy fixes that employees appreciate, like having to walk 10 minutes across a warehouse four times a day to punch in and out.
It turns out to be a win-win situation for all involved. Senior managers can look at recent data and get a good feel for the impact of a new contract. If they need to staff up, they can look at past projects and judge how adding more workers will affect productivity. Being able to drill down all the way to the task and employee level is very useful for gaining insight into the shop floor.
Arming the sales force with the data gives them more credibility. The human resources department benefits also because employee turnover is reduced and a more senior workforce is created.
Giving Your Employees Effective Rewards
Knowing which employees do well in different areas of the warehouse enables shop floor supervisors can be more effective in where they place workers. The system can be used to reward employees who excel or improve. If the LMS system is being used to reward employees and move them to tasks they like more it makes the system seem friendly. Under ordinary circumstances, it can be hard to judge what will happen if a long-term employee is ill. Using an LMS, you can know just how well other employees do at that job.
Effective labor and good freight management offer you complete control over logistics, according to FreightRun. The bottom line is that everyone ends up with better visibility over what goes on and it creates a level playing field for advancement. Labor Management Systems are becoming a key part of Supply Chain Management. The key is getting an LMS system that is easy to use and getting employees to buy-in from the very beginning. It ends up being a good way of achieving the holy grail of getting more done with less.