It’s a Post-Covid World … Can We Still Improve Operational Efficiency?

As rising order volumes and supply chain disruptions place increasing pressure on labor resources, e-commerce order fulfillment (e-fulfillment) centers are always looking for ways to improve operational efficiencies. Compared to traditional distribution centers, these e-fulfillment centers require significantly more labor resources to get orders out the door, to meet the promised customer Service Level Agreements (SLAs). But this is not unique to these facilities and to address the issues, we should look to other areas of business for ways to standardize, optimize and improve our operations.

To meet SLAs without cutting into profit margins, managers need to be able to quickly identify underperforming labor resources and process bottlenecks.

So, how do you do that?

I’ve outlined 10 simple ways companies can identify operational inefficiencies and address them before they impact the bottom line.

1. Know Your Operation.

Managers often overlook the value of regularly walking the floor to evaluate areas that are labor-intensive or where traffic may be congested. In addition to this simple step, more formal audits, metrics analysis and even business intelligence tools are useful to evaluating operations.

2. Benchmark Against Your Peers.

Network within your industry to gain insights and learn strategies that others have already successfully deployed. Engaging with your vendors and suppliers gives them opportunities to add value to your operations, strengthen your relationships and improve service.

3. Improve Customer Service.

Every industry is a service-oriented industry, and even the smallest of details can make a measurable difference. Reducing internal backlogs and ensuring vendor compliance are two easy-to-implement examples of how to do this. And talk to your customers.?Everything you do, should align to what they tell you.

?4. Put Your People First.

To up-skill, grow and retain employees, never forget that it’s still a people-centric business where relationships are important. To keep labor focused on productivity, establish two to five key metrics as common ground. Then, keep score and reward top performers while discouraging unproductive habits.

?5. Train, Train and Train Again.

Regular training (and cross-training) on systems and processes is critical to running efficient operations for associates and management alike. Providing a Knowledge Base (KB) Library where teams can post cheat sheets, document SOPs, and establish a “coaching” methodology are also training best practices.

?6. Focus on Order Fulfillment.

With increasing order volumes and SKU types, give your operation the proper tools to meet the challenge. From regular maintenance and system design evaluation to mobile devices and golden zone slotting, your goal is to create an environment that helps pickers perform at their best.

?7. Optimize Processes.

You would be surprised how many e-fulfillment centers don’t have proper process documentation. Once in place, these can be evaluated and updated for continual process improvement, or entirely rebuilt to incorporate new workflows or automation.?Leveraging methodologies like Lean Six Sigma and 4DX is a great start.

?8. Remove Barriers to Success.

Perform process analysis to track problems and identify opportunities for improvements. Pareto charts are useful for uncovering extremes and determining where to make changes. This is not a “set-and-forget” mentality, but an ongoing continual process.

?9. Assess the Power of Your Systems.

Conduct a technology review to assess the efficiency of your overall system. Is it delivering the throughput your operation requires? Then familiarize what offerings are available in the marketplace and decide if an upgrade is necessary.

?10. Raise the Bar.

Even after you’ve made improvements, it’s important to not settle for a new status quo. Instead, always strive to incrementally improve results and raise the productivity of low-performing associates.

Even taking a few of these steps can quickly help your operations become more efficient and help you achieve your process improvement goals.