|[November 29, 2012]
Distribution Centers Lose Nearly 3,000 Hours a Year on Unproductive Workflows
EVERETT, Wash. --(Business Wire)--
The warehouse and distribution center is under increasing pressure to
reduce cost and increase margins. Recent Intermec (News - Alert) (NYSE:IN) research
reveals that in the last six months alone, nearly eight out of ten (79%)
warehouse managers have been tasked with finding an average 19 percent
cost saving from existing operations. Despite this mounting pressure to
cut costs and the need to find efficiency gains in every process,
managers admit to losing time and money through known inefficient
The survey base of 250 supply chain, warehouse and distribution managers
stated that over an eight-hour shift, each worker loses an average of 15
minutes of productivity in an inefficient process. For a small- to
medium-sized warehouse with 50 workers, this quickly adds up to nearly
3,000* hours a year, and could be a significantly higher number in
Although most managers have been tasked with finding cost savings, close
to one in three (30%) have not conducted a review of workflow processes
in their distribution center within the past year. This is the first
step in identifying areas for improvement.
The majority of managers questioned believe the most inefficient
workflow in an eight-hour shift to be packing and loading (20%), closely
followed by picking and inventory control (both 18%).
This belief is born from the data produced by companies that have
recently conducted a workflow process review, who say that inventory
control (53%) and picking (47%) are the two areas where cost savings
could most easily be achieved.
Strong resistance to change
Perhaps surprising, the research shows that in companies that are yet to
take action to improve workflow productivity, there are high levels of
resistance to the idea of carrying out a full review.
Managers who have not held a review in the past year say that only
compliance (28%) or poor performance (27%) would prompt them to do so
today. The latter point is i stark contrast to those companies that
have recently conducted a review, and implemented process improvements
as a result, who say that they are mostly motivated by compliance issues
(26%) or continuous improvement programs (22%) and rate poor performance
as a very low (9%) driver for their action.
Most shocking of all in a world in which every customer's business is
hard won, and even harder kept, are the nearly one in five companies
(16%) who say they will not review their workflow processes until after
a customer complaint has been received.
Meeting cost targets: Every second counts
Whether they are prepared to conduct a review or not, the survey carried
out by research firm Vanson Bourne identifies the very clear pressures
that warehouse and distribution center managers are under.
Nearly all respondents appear to agree on the key to achieving this
goal. When asked how to improve performance across the warehouse and
distribution center, the overwhelming majority of managers (89%) said
they believed investment in new technology would enable them to claw
back their lost time and ensure greater worker productivity.
There is also increased awareness of the value that shaving just seconds
off workflow processes can bring. Nearly two-thirds (60%) agree that "Large
time and cost savings opportunities can be found in gaining back mere
seconds in operations workflows." Examples of how to achieve this
include having workers take fewer steps, investing in faster label
printing and quicker barcode label scanning and eliminating battery
Bruce Stubbs, Intermec Industry Marketing Director for Distribution
Center Operations, said: "Warehouse managers are faced with significant
cost saving challenges, which means they can't afford to let such levels
of time wastage continue. Businesses should be looking at every workflow
in detail on a regular basis to claim back the minutes and seconds they
need to achieve these savings. As this research shows, reviewing their
technology infrastructure may be the perfect place to start."
*Intermec research conducted by Vanson Bourne reveals that the average
worker loses an average of more than 15 minutes a day / 58 hours a year
/ 8 working days year. Assuming a warehouse with a minimum of 50
warehouse workers, this equates to 2,899 hours a year.
For more information, visit www.intermec.com,
or follow us at www.twitter.com/intermec
Intermec Inc. (NYSE:IN) is the workflow performance company. We design
the leading data capture and information management solutions at the
interface between mobile workers, assets, and customers. For more
information about Intermec, visit www.intermec.com
or call 800-347-2636.
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