A shortage of experienced warehouse staff exposes your business to hidden risk. What starts as a gradual build-up of congestion can quickly turn into logistics gridlock. Sooner or later you have painful problems to deal with, like incomplete inventory, missing goods and furious customers.
Supply chain companies must become more desirable employers. In short, that means offering better opportunities for advancement. Reinforcing that with superior on-the-job quality of life adds up to a powerful incentive to stay.
Of course there’s also enormous pressure to make logistics more efficient. It may seem like a zero sum game balancing costs with speed and systemization, but there’s a way to tackle all of it at once.
The answer is people-centered change.
Digitally-mature Companies Have Less Warehouse Turnover
What almost all of the most effective warehouses have in common is the use of advanced technology.
But the type of technology and the way it’s deployed varies widely.
For example, some of the world’s biggest retailers address the turnover problem with systems that track the efficiency of each employee, which closes the productivity gap between new and experienced associates. This makes the job more stressful but such companies are also able to pay higher wages, ensuring a constant supply of applicants.
Other companies take the opposite approach. Empowered with the right technology, warehouse associates can do more than move materials. They can generate valuable data, identify process optimizations and pick up the kind of operational knowledge that allows them to take on additional responsibilities and thrive.
But what is the ‘right technology’?
Ask Your Warehouse Employees Where to Find the Bottlenecks
With the increasing plurality of software and systems, top-down process transformation is becoming obsolete.
Digital change is more successful when it’s done in consultation with the people affected. The earlier they’re brought in, the better. It’s usually quite straightforward to map the day-to-day workflow frustrations of warehouse associates, supervisors and coordinators to wider business needs. For example:
|Employee Need||Business Need|
|“I wish I could get home on time”||Reduce overtime expenditure and other unpredictable costs.|
|“I’ve been doing the same job for years”||Recruit supervisors, managers and technology experts who understand the business.|
|“I go the extra mile and it goes unnoticed”||Improve productivity, establish best practices and predict throughput.|
|“Bursts of intense work are putting a strain on my health”||Avoid corner-cutting that can lead to material loss, equipment damage or OSH violations.|
|“Inspection and putaway procedures are not clear or consistent”||Speed up cycle time, improve inventory accuracy and make data more available.|
With these alignments identified, the next step is to carry out small change projects with both employee and business needs in mind.
Warehouse Clutter Is One Problem No-one Wants to Talk About
Clutter is both a cause and a symptom of the kind of underlying warehouse disorder that makes workers unhappy.
Tasks that are considered low-priority simply never get executed in high-pressure warehouses. Over time this creates an environment that is unpleasant and frustrating to work in, with each process requiring more effort than it reasonably should, but little hope for ironing out those creases.
There’s nothing more demotivating than coming into work every day to fight what seems to be a losing battle. Hard work is rewarding when things seem to be moving in the right direction. Less so when the view from the floor is that operations are breaking down - a view that sometimes goes unnoticed by leadership, whose key metrics may tell a different story.
But ignoring these problems will have consequences, not just in terms of labor but also for innovation and competitive advantage. A disordered warehouse is much harder to change, and especially harder to rationalize with more advanced systems.
The direct solution would be additional labor - but that’s out of the question for any warehouse operating on a tight budget.
Will Automation Solve the Warehouse Turnover Problem?
An argument put forward in some supply chain circles is that labor problems will fade away as industrial robots become more advanced.
This point of view grossly underestimates the complexity of integrating such systems, and the enormous size of the competitive advantage for those that do so strategically instead of rushing in blindly.
When the next generation of automation matures, the winners of the ensuing shake-up will be the companies that can get enthusiastic participation from the workforce.
Even advanced robots need to be trained and supervised. The most useful applications involve a significant degree of collaboration with human operatives, and designing effective workflows requires input from the people who know those processes best.
In other words, ignoring the problem in the hopes it will go away by itself is a doomed approach.
Why Do Warehouses Have High Turnover Rates?
What are the real drivers behind the ‘great resignation’?
Part of the problem may be a lack of confidence in the future. A constant sense of urgency has emerged, where short term concerns regularly take precedence over the long term. Some of the largest employers pay sign-on bonuses, and one-off ‘gig work’ is more immediately lucrative for many workers.
On top of that, the baby boom generation has started to retire, and there are simply not enough people to replace them.
The logistics industry in particular seems to suffer from a vicious cycle, ever more dependent on temporary staffing agencies, with less commitment to developing people over the long term. Many warehouse workers report feeling treated disrespectfully on the job, while others point to a lack of clear feedback.
Retaining warehouse employees requires a vision for the future.
For any supply chain company, hiring and developing young people should be a c-suite concern. This is the most direct route to create a generation of future leaders for the business. Meanwhile, employers need to give their warehouse associates a chance to invest in their own futures. A good starting point for that is more consistent work schedules, so they have energy for their families and their health.
How Implementing DataDocks Reduces Warehouse Turnover Rate
Warehouses should look for projects that can advance their level of digital maturity while simultaneously improving quality of life for their workforce.
One low-risk, high-reward example is implementing dock scheduling.
Some form of this is probably available through your WMS, or can be acquired cheaply with basic appointment scheduling software. Unfortunately, these tools tend to barely improve on excel spreadsheets in practice, with clunky user interfaces or poor security. They may even miss essential features like automatic notifications when the schedule is changed.
Getting dock scheduling right requires a phased approach that gets carriers on board. What starts with a vague agreement to make appointments and attempt to meet them gradually becomes an analytical conversation, backed by data: “the closer your trucks arrive to their scheduled time, the faster we can work them.”
Before long, loads are coming in and out at a steady rate, the shipping and receiving team knows what to expect, and everyone working in the loading dock gets home on time.
A win like that in the most chaotic process of the whole warehouse cycle soon percolates out into other areas of warehouse operations. Efficiency improves, morale improves and retention improves.
To learn more about integrating DataDocks at one or more of your facilities, book a demo with our team or call (+1) 647 848-8250