The MHI U.S. Material Handling and Logistics roadmap indicates a shrinking pool of qualified labor and high turnover rates due to retiring baby boomers and a lack of skilled younger workers to replace them. As turnover increases, competition for labor drives higher base wages, leading businesses to place a premium on improved employee performance and measurable returns on workforce investment.
For operations with more than 50 employees working the floor, labor management software (LMS) can deliver significant performance gains beyond basic in-house tools and the addition of extra staff. With automated functionality, in-depth reporting and thorough analysis, it frees management to look beyond simple labor tracking to unlock new levels of productivity that eclipse the capabilities of alternative solutions.
Investment in LMS helps management and employees to:
Understand corporate objectives
An effective LMS implementation simplifies communication of strategic goals, expectations and actual operational metrics. This infuses transparency into worker performance evaluation by enabling employees to understand their achievements in relation to business objectives. This transparency eliminates discontent due to perceptions of unfairness or allegations of favoritism and boosts worker confidence, ultimately reducing turnover and improving labor performance.
By connecting employee output with business goals, LMS fuels career development and improves overall employee engagement. With engineered labor standards, employees work towards clearly-defined, realistic targets with the confidence that their actions yield both personal and operational benefit. This approach produces consistent individual development that results in benefit for the entire operation as overall throughput improves with incremental individual gains.
Discover new opportunities for improvement
LMS automatically tracks labor and provides extensive reporting and analysis to release supervisors from the time-consuming burden of manual reporting. This frees management to spend time coaching and observing employees to take remedial action and identify process improvements to implement with the rest of the workforce. As DCs look for the most efficient way to utilize scarce labor, a robust LMS can also look beyond a single facility and leverage the entire distribution network, helping management to discover new opportunities for consistent, year-over-year improvement and make more informed decisions that maximize available labor.
Use analytics to make your business smarter
As operations extract productivity and efficiency gains from individual locations, they can compare multiple facilities within their distribution network according to overall output, individual processes and labor performance. Even if some facilities have different names for the same process, an LMS can execute apples-to-apples comparisons by equating different names with the same function. For example, the same process may be known as “receiving” in a manual facility, but be called “induction” in an automated DC. On the ground, these multisite analytics encourage healthy competition against other locations across the country, rather than potentially damaging rivalries amongst co-workers in the same facility.
Optimize labor to face the challenges of tomorrow
For an industry in flux, the flexibility of LMS positions it to solve today’s labor challenges and adapt to emerging issues. Labor is the most flexible fulfillment tool in the distribution arsenal, and LMS offers the most efficient means to tailor the workforce to meet operational challenges. Whether onboarding new employees, updating experienced workers or incentivizing process improvements, LMS offers an effective platform to drive a culture of individual accountability and continuous improvement.
For more information on improving workforce efficiency and productivity, read the Intelligrated white paper: Do more with less: How to thrive in a challenging labor market.