A highly automated e-commerce distribution center for a Fortune 200 retailer needed support designing a world class labor management program with cutting-edge performance technology.

The Challenge

LogistiPoint joined this client during the tail end of their first operational year and was tasked with designing and implementing multivariable standards in conjunction with a people-focused training program to support the leadership team responsible for managing the labor program.

Achieving a healthy and efficient labor climate requires capable and confident leadership armed with carefully designed and effective tools. Once live, the program would support associates by providing valuable, real-time feedback, help supervisors identify trouble spots needing attention, and equip executive leaders with high-quality data to better inform critical operational decisions.

Our Solution

Our team began by performing detailed process audits and partnering with operations on the recommendations to ensure optimal conditions were established. This set a solid foundation for our time study observations where we gathered hundreds of hours of highly detailed data. Once organized, the data enabled the discrete values for each unit of measure completed throughout an associate’s workday. We were able to capture and accurately credit details such the ratio of tray availability to associates inducting at a sorter, the degree of physical bend and reach on a put wall, the relative cube and weight of various items, and even the need to add fragile dunnage to certain item orders. By providing this exhaustive level of credit, the engineered labor standards exhibited extremely low variation, which drives associate trust and adoption.

Supporting these high quality standards was a cutting edge Labor Management System platform that provided real time performance scores to all associates on either a handheld device or workstation monitor. Today, the scores update live – at 1 minute intervals – and provide critical current performance feedback that helps pace associates over the course of their day and provides supervisors with instantaneous performance visibility of their team. This combination of robust and dynamic multivariable standards and live performance technology will transform the landscape of labor management in the coming decade. 

To ensure that these tools were used to their fullest, our team designed and delivered a comprehensive training program covering both technical and leadership skills development . This included detailed sessions on the fundamentals of multivariable standards to ensure supervisors could readily and effectively respond to associate questions about the fairness and achievability of the standards. The leadership training used methods of film study, role playing and on-the-floor feedback sessions to strengthen front line supervisors’ coaching and communication skills as they interact with associates.  

Thanks to high adoption by associates and supervisors, the executive leadership team found themselves not only able to feel the pulse of the building through timely, accurate and actionable data, but also to leverage all of those attributes into transformational results.

The Results

The program resulted in an average monthly labor efficiency improvement of over 31%. This translates into labor budget savings over $1.5m within the first year following program installation; achieving a break-even ROI in less than 10 months.