Besides inventory, your logistics workforce is the most significant expense in your distribution centers, eating up a large portion of the warehousing budget. It’s why reducing and managing expenses related to labor is a huge priority for almost every logistics executive. As one of the best warehousing and distributions companies, we offer you some of the best logistics management strategies that work for us and may work for you as well.
- Invest additional time upfront to appoint the right people
The majority of experts agree that this is the only way to improve productivity and reduce turnover. However, a lot of clients rush the hiring process to fill much-needed positions. Our advice: carefully vet new associates by investing time – all levels – and always prefer attitude over skill. In simple words, ambition and attitude can’t be taught.
In contrast, it’s relatively simple to teach someone how to pack an e-commerce order or operate an RF gun. Despite this, businesses frequently appoint poorly motivated individuals who have 5 months of warehouse experience over experienced, motivated candidates – just not within a warehouse setting. Don’t do it. Use multiple interviews and personality testing to identify individuals with genuine enthusiasm – at whatever they turn their hand to.
- Pay additional attention to developing DC supervisors and managers
Montage Fulfillment LLC believes that supervisors and DC managers have a disproportionately high impact on long-term retention and associate happiness. These mid-level managers are the face of your firm and set the tone for your logistics workforce. It’s quite important that they not just run an efficient operation, but cultivate positive interpersonal relationships with the individuals who do the loading, packing, and picking.
If warehouse associates don’t respect and like the people they work with and for, they’ll most likely leave. The moral of the story: If you’ve got supervisors and DC managers with the rare combination of strong interpersonal skills and operational acumen, show them a clear career path by investing in their personal development. Offer incentives for them to stay, because if they stay, you’ll witness lower attrition across all of your workforces.
- Make workforce retention a priority
Finding and keeping dependable, qualified workers is one of the toughest day-to-day challenges for logistics executives. Of course, retaining warehouse workers is challenging, but you’ll have to be wise for investing in strategies that expand your retention rates well above the industry average. That’s because, with training, recruitment, and other costs, you’ll have spent a significant amount of money on replacing employees when they resign.
Actually, the total cost goes much, much higher if you consider lost productivity. During the training phase, newer associates can take a month or more to match experienced associates’ productivity levels. If you’re operating at half the productivity, you essentially double your labor costs to achieve the same output. The following are certain strategies that one can use to improve retention:
- Set competitive benefits and salary package for the market you are in. Dissatisfaction is the only reason works leave their jobs.
- Show associates a coherent career path. Associates need to witness your firm in their personal future.
- Recognize accomplishment with inexpensive, easy gestures like a rewards program or personal notes.
- Many workers who leave a job say the firm could’ve done something to prevent them from leaving.
- Hire from within
There’s a huge talent gap in logistics. When a key spot needs filling, a lot of firms instinctively look outside to fill the position. There’s an assumption that bringing in outsides can accelerate the accomplishment of a business objective. A decent metaphor might be the baseball team that pays a lot of money for free agents to offer a quick fix for a losing record. However, performance results have shown that sustained success is possible when the team invests in its farm system and primarily depends on home-grown talent.
A lot of logistics companies have special programs to grow and nurture their “high potential” managers. And this investment is proving to be quite beneficial. For instance, our director of operations for a big retail client started as a temporary warehouse worker. Today, he’s managing three big DCs that process millions of dollars in inventory daily.
Companies without such programs are in danger of losing ambitious and talented managers if they don’t see the opportunity where they’re now. 3rd Party Logistics Company the people who hire from within and develop internal talent create a fortuitous cycle. Your logistical workforce appreciates being part of a culture of advancement and learning; this increases morale and improves retention rates, along with overall productivity.