The automation and software breakthroughs shaping the next generation of distribution centers (DC) have powered extraordinary improvements in throughput and efficiency. These emerging capabilities introduce new management challenges and opportunities for executive leadership teams:
- Can they foster a healthy and productive employee population that interacts heavily with robotics and computers and receives constant performance feedback?
- Will their frontline managers and engineers be agile and resilient enough to respond to constant but necessary software enhancements or unexpected outages?
- Do they have the appetite and focus to drive success toward their bottom-line goals while forging ahead where few have gone before?
Exploring Real-Time Data to Improve Performance and Productivity
As we discussed in our e-book, Setting the Standard, automated DCs are ripe for building accurate multi-variable standards that not only supply supervisors with the data necessary to effectively manage their associates but also provide supervisors and associates with live performance data. Real-time performance data is available to supervisors when associates work with a workstation monitor or handheld device. The data can offer transformative opportunities for leaders to give positive feedback to associates excelling in their position, while also revealing the need for intervention with low-performing associates.
While live-performance data has many benefits, including increasing the accountability of associates, informing supervisors of coaching needs, helping eliminate problems early, and identifying valuable practices from exceptional workers to include in standard operating procedures, it is not a cure-all. Live performance data does not eliminate the need for interaction between supervisors and associates. Associates might believe they are being monitored by a computer software alone, which can feel impersonal and potentially demotivating. With that in mind, supervisors must be intentional about keeping communication channels open with team members. Leaders may use the data as talking points for positive coaching opportunities and when describing lessons learned. In doing so, live performance data becomes a valuable tool that can dramatically improve supervisor visibility and associate productivity.
As real-time performance measurement becomes ubiquitous, employees expect scores to fairly reflect their efforts. To stave off skepticism about scoring that frequently comes up among associates, the onus is on supervisors and other leaders to ensure employees fully understand how performance scores are calculated using the data. For example, we partnered with a leading e-commerce retail client to build highly dynamic multi-variable engineered labor standards (ELS) that consistently provided performance scores with less than one percent weekly variation. When associates could see the level of accuracy of the performance measurements, it established trust between the workforce and supervisors about the scoring system.
Importantly, associates must also believe that performance expectations are attainable. Well-engineered labor standards (ELS) provide quality measurements, but a building director mainly needs quality performance. This requires capable and confident leaders to effectively use ELS in a positive and productive environment. Invest in your front-line supervisors by providing training both in the classroom and on the floor as this combination of technical and soft skills training are essential to driving a positive and high performing culture.
Maximizing Your Investment in Automation and Software
Automation and software make new frontiers achievable, but the technology must work well and operate consistently to provide benefits. Like anything with many moving parts, such as lines of code, leaders must prepare for breakdowns and maintenance work. To do so, we recommend staffing your automated DC with full-time, on-site industrial engineers. Alternatively, consider positioning engineers in key operational leadership roles. The technical capabilities specialized engineers bring to the table will help ensure your systems are aligned and a go. While this staffing approach might at first seem excessive, we have witnessed organizations transform operations and drive productivity by establishing this model. When you invest in high-quality equipment and software, don’t forget to invest in an executive advisory team that will help you get the most out of it.
Encouraging Experimentation and Failure
Embracing continuous transformation and perpetual improvement is not an easy feat, but it’s imperative for businesses in today’s rapidly changing market landscape. Leaders on this new frontier must promote experimentation and failure among the workforce to drive innovation and transformation.
As one example, our team helped develop a boundary-pushing concept called automated wait-for-work to improve the quality of data used in labor management programs, namely an associate’s on-standard time (time spent doing productive work) and indirect time (time spent doing non-value-added work). Typically, associates must manually track when to switch between these categories, which can be tedious and often leads to data integrity loss. Automating this process would not only improve the quality of data, but it would also save associates’ time.
When you track indirect time more accurately, you end up lowering your on-standard time. That is exactly what we observed when implementing automatic wait-for-work. However, we also noticed improvements to on-standard time. How was this possible? Associates were accustomed to expecting the system to notify them when there was no work available. They observed that sometimes when they had no work available, the system failed to notify them which caused the associates not to be placed into indirect time tracking. Associates shared this finding with their leaders who discovered a software bug and resolved the issue. Work returned to that station and resulted in a material improvement in associates’ productivity.
This instance of continuous improvement coupled with refined data quality and a reduced burden of time tracking demonstrates the powerful potential of an aligned leadership team.
To stay ahead of the curve and harness your operations as a differentiator, it’s imperative to strategically integrate labor and automation at each level of your organization. While industry leaders aggressively innovate and labor continues to become more competitive, can you afford not to modernize your operation?