Materials Handling

Why investment in people matters

By Gian Schiava

October 2019

Train your warehouse workforce and maximise your competitive strength

The importance of the warehouse is no longer just as a storage facility, enabling economies of scale in production. Today it has become a distribution centre with roles in meeting KPIs, interacting more closely with other departments and even dealing with customer demands. Companies have invested in state-of-the-art tools and equipment, but how are they making sure their staff can keep up with the changes? As Gian Schiava discovers, it takes more than a drivers’ course to ensure maximum output.


Adapt to today’s complexities

So, warehouses have become distribution centres – but what’s the big difference? Well, here are a few comparisons:

A warehouse is used for storing products while a distribution centre, in addition to storing products, offers value-added services like product mixing, order fulfilment, cross-docking and packaging.

A distribution centre stores products for relatively short periods compared to a warehouse. This means the flow velocity is much greater through a distribution centre than through a warehouse.

A distribution centre is customer-centric and is the buffer between supplier and customer. While the role of a warehouse is efficient product storage, the role of distribution centres is to meet customer requirements efficiently.

The operations at a distribution centre are much more complex than those of a warehouse. As a result, distribution centres are equipped with the latest technology for activities such as order processing, warehouse management and transportation management.


Step up to meet new needs

This ever-growing complexity of tasks means that staff also have to meet new criteria. The company hiring them is not merely looking for cheap labour but is seeking skills and experience that will help in reaching its goals.

First, the forklift drivers. Basic driving courses have already existed for decades and employers commonly require the driver to have some sort of certificate. Refresher or follow-up courses were a later development and are important to get acquainted with the latest types of controls.

Another issue is that counterbalance and warehouse trucks are now being refined with all kinds of new equipment, like scanners, augmented reality devices and voice systems. Drivers must learn how to operate them. Advances in methodology add further interest and scope to the process of learning.

Logistics services provider DB Schenker, for example, is planning to test a virtual reality (VR) training device, delivered by German company Fraunhofer, in its Tilburg distribution centre. Typical storage and retrieval processes are simulated by the system. The prototype consists of a forklift control system reconstruction, connected to VR glasses. A combination of steering while at the same time having a 360-degree view through the glasses precisely simulates the situation in a warehouse.

The company sees this as an additional training tool to shorten the necessary training period. It also gives new operators a chance to train in the environment in which they will actually work. Even health and safety training (a whole topic in itself) is built in: the system will not work if you aren’t wearing the seat belt, for instance.

Special training courses are being developed to teach people in logistics how to cope with increased digitisation. After all, technology is rapidly changing the work environment and staff have to coexist with developments like autonomous vehicles, robots and high-tech sorting systems.


Advance your managers’ skills

It’s not just people on the warehouse floor who are upgrading their skillset. Management also has to meet much higher standards, especially in view of the impact overall performance has on the bottom line and customer satisfaction. Research by four American universities on the role of warehouse managers shows that their job requires a far longer list of competences than any other in logistics.

Their main focus is on deploying human resources and operations to achieve optimum results. However, modern warehouse managers also have to interact much more with other departments and with other companies earlier or later in the supply chain. Their competency list includes the usual suspects, like decision-making and communication skills, budgeting, and knowledge of warehousing and inventory control, but also presentation skills and purchasing.

The research also reveals that many managers acquire most of their knowledge through on-the-job experience rather than training, which is unfortunate. Given the growing importance of the warehouse manager’s role, the researchers recommend structured, ongoing, on-the-job training programmes for all employees. These should at least include communications, interpersonal and supervisory skills development, along with the expected operational courses.

The Dutch Logistiek Academy paints an even broader picture. In order to become a true strategic member of the management team, warehouse or logistics managers need to add in-depth knowledge of various subjects to their skillset. They include supply chain management (including sustainability and digitisation), Big Data, lean management, planning and forecasting, purchasing and even supply chain finance. That’s an impressive list.


Save the crown jewels

Investing in well-trained people does pay off. Besides better performance, companies can expect increased motivation and happier employees. However, other companies might want to take a short cut and tempt your employees away after all the quality-increasing effort you have invested in them. Developing and executing well-defined retention programmes is therefore another key task for the warehouse manager.

On top of communicating well, arranging fair salaries and creating a healthy and pleasant work environment, additional measures are needed to keep the best people in-house. Best practices include career development programmes, bonus schemes, social events or even a small present from time to time.

No matter how you look at it, retaining existing employees requires an investment of attention and money, but it’s still a significantly more cost-efficient approach than recruiting completely new employees. The orders will continue to arrive, and they will have to be fulfilled; possibly the same day. Companies will need their people to perform well each day, to get the best out of new tools or advanced materials handling equipment. No matter how much technology is advancing, we will still need human thinking power to get the job done.