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About the Author

Cliff Holste is Supply Chain Digest's Material Handling Editor. With more than 30 years experience in designing and implementing material handling and order picking systems in distribution, Holste has worked with dozens of large and smaller companies to improve distribution performance.

Logistics News

By Cliff Holste

September 17, 2014

Innovation – Paramount Importance Driving Operational Improvement

Industry Leaders Provide list of Innovative Improvement Initiatives

Holste Says:

Management of innovation, in order to systematically generate new ideas and to develop them into marketable goods and services, has become a key competitive factor in today's business environments.
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Previous Columns by Cliff Holste

Sorting It Out: Shippers Looking To Increase System Capacity Are Surprised To Find It May Already Exist!

Sorting It Out: For Shippers - Benefits Of Real-Time Control In The DC Are Huge!

Sorting It Out: Shippers Looking to Improve Operations Choose Customer Centric Approach

Sorting It Out: Productivity is a Crucial Factor in Measuring Production Performance

Sorting It Out: Packaging Construction Impacts on Logistics Operations



A 2005 empirical study (conducted by the management consultancy Arthur D. Little) showed that innovation is of “paramount importance” for companies and policy makers due to the increased importance of innovation as a result of quickly changing technologies and environments, shorter product life cycles, and increasing difficulty to stand out against competitors. The study found that retail customers are increasingly more sophisticated, segmented, and demanding, and expect more in terms of customization, novelty, quality, and price. The findings of this nine year old study are even more relevant today. As a consequence, the management of innovation, in order to systematically generate new ideas and to develop them into marketable goods and services, has become a key competitive factor in today’s business environments.

Many business managers are struggling to keep tight control of the reins while at the same time not inhibiting growth. A few weeks ago we posted an article titled – “When Seeking Project Approval – Be Prepared With Facts & Figures” which included a list of tough questions you can expect the financial officer of your company to ask when seeking project approval. But, what if funding is not available? In this tough situation, innovation (sometimes referred to as thinking out-of-the-box) may offer acceptable alternatives.

The question is how can this untapped resource be turned on? SCD did some research and found an interesting list of innovative improvement ideas that were presented at a National Conference on Operations & Fulfillment (NCOF) that just might get the creative/innovative juices flowing.

The following is a selection of innovative improvement ideas (that do not require capital funding) from (3) NCOF2011 panelists; Daniel Knight, director, fulfillment/quality, Home Shopping Network; Christy Para, director, logistics systems, The Container Store; and Mark Taylor, CEO, Taylor Systems Engineering Corp.

1. Catch your staff doing something right. Carry gift certificates to places such as Starbucks, McDonald's, movie theaters, or the car wash. When someone has done something above and beyond the norm, recognize their efforts immediately by giving them a small token of appreciation. - Mark Taylor

2. When you notice someone doing something not according to standard, ask their permission to offer a suggestion. Doing so softens the feedback that follows, and gives the other person a moment to prepare so they are less likely to be caught off guard. - Mark Taylor

3. Have your daily goals and results open automatically on PCs when staff members log in. This keeps everyone aware of the previous day's achievements. - Christy Para

4. Have all information shared at huddles or team meetings in a log. Anyone who missed the huddle can simply read the log and catch up on what they missed. This keeps everyone up to speed at all times. - Christy Para

5. Help everyone in the facility understand your metrics. Have managers in one department learn the metrics used by another department. Then, in a small group setting, have the managers teach these metrics to the supervisors. Supervisors then teach metrics to team leaders, who teach them to associates. Continue the process through the ranks until all levels of employees have completed this cycle for all metrics. The result: improved overall performance, as employees at every level better understand the business. - Daniel Knight

6. Improve your operations by talking with your top-performing employees. Ask for their ideas on how to improve efficiency and cut costs, then listen to their replies. Don't forget to give full credit for their ideas if you adopt them. - Daniel Knight

7. Focus on DC cleanliness. Every department at the Container Store's distribution center is assigned a group of aisles or an area in the DC that they are responsible for cleaning. Every day at the same time, an alarm goes off, which alerts everyone to stop and clean for 10 minutes. This helps keep the DC in tiptop shape daily. - Christy Para

8. Make it easy to spot pallet jacks that have wandered off. Assign different colored tape to various areas in your operation, then attach that color tape to pallet jack handles assigned to a particular area. - Christy Para

9. If you use bar-code scanners to scan order numbers, hook each scanner to a bungee cord. This keeps the scanner in the same spot and enables associates to simply let go of it, eliminating the possibility of the scanner dropping to the floor. - Mark Taylor

10. If you have multiple facilities in your distribution network, conduct a monthly best practice conference call between DCs to share and discuss internal best practices. Focus on two or three different departments each month. Group departments by process, such as receiving, quality assurance, and putaway for inbound. - Daniel Knight

11. Take a few minutes each month to pick an order or pack a shipment. There's no substitute for experience - get out there and re-experience your facility. Benefits of doing so include enhanced visibility, heightened awareness, increased approachability, improved manager/employee relations, increased efficiencies, reduced operating costs, improved safety, and more. - Daniel Knight

12. And then we found this idea from an unspecified source:

Reduce Touches: In some DC operations as much as 50% of labor hours are spent on double or triple handling tasks. To draw attention to this put up signs promoting O.H.I.O. (no not the state) Only Handle It Once. Why? Because this will encourage associates to ask – can we crossdock this SKU, or, at a minimum, can we by-pass reserve storage and put it directly into an active pick slot. By simplifying processes, reducing touches, combining tasks, shortening travel and eliminating steps, labor and cost is reduced.

Final Thoughts


Good operational improving ideas don’t have to be limited to physical equipment, controls or software expenditures that require capital funding. Business managers can boost productivity of their operations by creating an environment where everyone has some “skin-in-the-game” and know what is expected of them. Creative, innovative ideas, like the ones listed above, promote a higher level of participation through shared experience.


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