This leading Medical Supply distribution center was a self described company on the verge of a “huge and terrific” breakout. As an industry leader and developer in the technology required in manufacturing their state of the art product, they had a continuous stream of new products scheduled to debut and bring to market. Their aggressive marketing plan promised not only new and exciting products, but also premier service levels that leveraged third party delivery services, new state of the art order sorting, handling and labeling equipment that was recently purchased.
As part of their integrated marketing plan the advertised “same day” and “next day” shipments service was key to both increasing market share and bottom line performance.
Over the previous year rapid expansion
of sales, new product configuration, change over to new and upgraded equipment and facilities resulted in a stressed warehouse order handling operation. The challenge for order handling soon became one of keeping
pace with already rapid expansion which showed no signs of slowing, as well as, improving shipping and service performance to expected levels. All of this needed to be done, while at the same time, reducing excessive
cost to maintain the levels of performance which were insufficient in meeting company demands.
Executives described their concerns as being founded in the lack of the management teams ability to execute the simple “blocking and tackling” of management activities, poor employee morale and a lack of understanding of “good warehouse practices.” All of these seemed to be holding the organization hostage form the explosive growth on the horizon.
The Assessment process began with a partnering of an AMS professional conducting detailed observations of managers, supervisors and a sampling of employees as they conducted their day to day activities. After a thorough review and validation of the data and information, it was determined that frontline supervisors were not properly trained in effective management techniques. Middle level managers did not provide frontline supervisors and managers with a plan that was executable or sufficient to achieve the goals of the Order Handling Operation. Operating problems were going un-addressed and unresolved with no permanent or lasting solutions. Frontline managers lacked the fundamental understanding of how to utilize performance metrics to recognize poor operating trends.
The Analysis process also provided a quantified value of the lost productivity due to the operating deficiencies identified. The next step was to develop a comprehensive approach that, in the words of the VP of Operations, would “right the ship and allow them to sale to calmer seas.”
The approach that was developed and offered forward to the Client executives was one that called for interactive workshops for frontline supervisor and managers on basic management techniques. On-the-floor coaching and mentoring of client managers and supervisors with AMS Implementation professionals on a 5 to 1 ratio for a period of 28 weeks. An interactive development of standards and goals in conjunction with client process engineers. The training of Middle level managers in the development of a comprehensive Management Operating System that would drive the proper management behaviors necessary to achieve the desired operating results, as well as, sustain them.
The scope of the project included all of the Order Handling Operations and shifts. Additionally, the project included the process engineers and maintenance personnel that were responsible for supporting the Order Handling Operation over a period of 28 weeks.
Implementation began with an official rollout of the project and its related objectives. It was critical that the project objectives seamlessly merge with existing operational objectives. At the same time, the AMS Group professional began building a working relationship with all levels of the client management team. Middle level managers began learning about the importance of having a comprehensive Management Operating System to manage productivity. Additional operational changes focused on:
By the end of the 28 week installation period, the culture of the order handling operation had affected a dramatic change in performance. Efficiency goals were now being attained or exceeded. Service levels had been maintained and were now measured more accurately and timely. Overall, the culture of the facility had changed to one that encouraged performance excellence through employee participation and performance and proactive management practices.
Summary of results:
Order accuracy was improved to 99.7% by the end of the project
“I was ready to quit the day you guys got here. But when they announced that you guys would be here, I just took a few days off and figured I’d wait and see what happens. This is a different place. The supervisors actually listen now, … and they make sense too”! – Senior Warehouse Order Picking Clerk
“This process helped me to better plan work for my employees. I wish we had some training before you guys got here”. – Warehouse Picking Supervisors
This was a big help to me. I know what the problems were, but I (We) could never stop the fire fighting to get to work on them”. – First shift Operations Manager
This was one of the hardest things I’ve ever done! I thought I knew how to manage my guess but now I know it’s not just knowing the job. There is a lot more to it than that.” – Machine Room Supervisor
“I can see the change in my management team in this short time you have been here. My people come to me with data and facts. I have a whole new understanding of all of them” – VP of Warehouse Operations
“I actually look forward to our weekly staff meeting with the operations people. The service level numbers are a complete turnaround. Now the pressure is on my guys to pickup the ball and run”. – Senior VP of sales and Marketing
