Why Not Shoot For The Moon?

For example:

• Dock-to-stock time: Why not go for "gate-to-stock" time instead. Aim to reduce the total time that it takes to spot a trailer, unload the pallets or cartons and transport them to a storage location using the advanced ship notice data to setup the receiving process while the shipment is still enroute.
• Touches: Put up signs promoting "OHIO" – no not the state (Only Handle It Once). Why? Because it encourages one to ask, can we crossdock this receipt? Or, at a minimum, can we by-pass reserve storage and put it directly into the forward pick slot? In many DCs something like 30% to 50% of the labor is not devoted to picking, but to the tasks that support picking.
• Productivity: Should you try to match the best of your competitors? Or should you be looking for the best demonstrated practice across all industries? Shoot for total operational productivity improvement - understanding that real productivity is a combination of efficiency process methods in addition to effective utilization of all of the paid hours for both process and support personnel.
• Quality: Remember that 99.9% still disappoints one customer in a hundred. What processes do you need to put in place to hit 100% - on the first pass! No inspection or re-work allowed.
• Space and cube utilization: In a typical warehouse, product occupies only 25% of the available building cube, even when its consider it to be full. The rest is aisles, dock space and otherwise unused air space. The key to increasing this number is choosing the right storage mode for the inventory characteristics of each product (see – Rack up Savings by Putting the Squeeze on DC Storage Space).
• Employee satisfaction: Good processes are important to the achievement of high levels of quality and productivity. But processes do not run by themselves. It takes trained and motivated employees to make them effective. Can you find ways to reduce learning time to hours instead of days or even weeks? Can you create a work environment that is ergonomically, functionally, and socially friendly enough to keep costly turnover to a minimum?
  
  

What’s it All Going To Cost?

Now, the hard part; how much can you spend to reach your objectives?

In fact, if you could achieve all of them, you might easily reduce DC labor by 20% while optimizing storage and increasing throughput capacity. The reduction in annual operating costs alone, when spread over an 18 to 24 month period, could provide the capital for improved material handling processes and the information systems required to support them.

How can you make this happen? 

• Form a team of people who know your business well, but are not “wedded” to the current process.
• Support the team with some outside resources who can stimulate your thinking and bring experience from other industries (see - A Consultant Might Just Help you Save your Automation Project).
• Get your team together for a few intense work sessions. Don't worry about being too ambitious. That's the whole idea.
• Get management to challenge your recommendations. Be careful though - they may get excited and push you even harder.