In most cases, efficiency is the relationship between ends and means. An inefficient situation is one where it is perceived that the end could have been achieved by fewer means, or the means could have produced more of the desired ends. Of course, efficiency is valued differently depending on the nature of the process, whose valuations we focus on, and how they’re weighted.
For warehouse efficiency, measuring can be a challenge. However, it’s not impossible to determine, especially if you can employ the help of a warehouse management system. These three types of metrics can help measure efficiency in your warehouse. See which ones you’re already measuring, and which ones you might want to add this year:
Stay Covered With Umbrella Metrics
When it comes to an incorrect order, the customer doesn’t care what went wrong where in the process, they just want it fixed. In order for your team to reduce the likelihood of the error happening again, it’s important to find out what exactly needs to be corrected.
Warehouse management systems can track all orders as a big umbrella. From there, each order can be broken down and tagged with more information on the specific error, including accuracy issues, out-of-stock products, late deliveries, or damaged products. This umbrella statistic lets you see the error from the customer’s experience, but fix it from the internal perspective.
Improvements Via Productivity and Labor Metrics
Warehouse management systems are great at tracking productivity and labor metrics. Some of what you can expect your system to track include:
- Fill Rate: How many items are being picked compared to the number of items ordered?
- Order Accuracy: How many items are correctly scanned in and out of bin locations?
- Shipping Timeliness: How many orders are filled and shipped according to promised delivery dates?
- Downtime: How much time is there between items picked, and is this based on bin location?
Not only do these metrics reveal how your team performs under a variety of workloads, they also reflect how well the warehouse is organized. Mis-scanned products, shelf IDs, and purchase orders can cause accuracy errors, while excessive downtime or orders that are waiting too long to ship after being completed may indicate where improvements can be made in the warehouse’s organization.
Stock Metrics Track Non-Staff Complications
Some order issues have nothing to do with the staff and everything to do with the stock. The right warehouse management system will look at complications from items that are:
- Out of stock. Backordered items can cause a customer order to be delayed.
- Looking at how long products are in your warehouse and whether you’re holding to FIFO or other policies can prevent expired products from shipping.
- If an item is not where it is supposed to be, your system may reflect there is inventory when the bin location is empty. This also falls under accuracy measurement.
- Product demand ebbs and flows along with the seasons. A warehouse management system can look at trends according to season to ensure the right items are in stock to match the timely demand.
PositiveVision Can Boost Efficiency Measurements
Measuring warehouse efficiency moves from the top down, starting with how your customers are experiencing your services. Having the right warehouse management system in place can be key in measuring the right metrics for efficiency.
No two businesses are alike. What your organization needs from a warehouse management software is unique, and PositiveVision understands you need solutions specifically tailored to your business. Our distinctive capabilities can help you address your warehouse’s specific challenges today to grow and profit long into the future. Find out how the right software can transform your business in 2020. Talk to one of our experts now.