Successful warehouses are not bought – they’re made. While implementing new strategies and processes is always beneficial, understanding how these new strategies and processes impact your company is crucial to your success. Implementation without measurement is a surefire way set yourself up for failure.
Why Warehouse Managers Need Metrics
Warehouse management leaders are obsessed with studying metrics to improve their organization. Metrics can provide managers with key insight into the warehouse, helping them identify trouble and determine the best course of action to take. Warehouse management leaders typically group their metrics into the following four categories:
- Operational: The operational metrics serve to measure the efficiency of the warehouse operation. Operational metrics help measure the efficiency of the material handling operations within the warehouse.
- Stocking Efficiency: These metrics measure the effectiveness of the warehouse space usage. They show how your warehouse is making use of its space, show how racking and slotting needs are being fulfilled, and determine how these decisions affect the operations.
- Fulfillment: Fulfillment metrics serve to measure the ability of a warehouse to fulfill orders on time and accurately. These metrics measure the effectiveness of the inventory planning and replenishment systems in the warehouse.
- Financial: The financial metrics serve to measure how well a company is doing financially. These metrics depend directly on the other categories and, thus, will improve directly in response to improvement in the other metrics.
Great leadership involves more than simply showing up; it requires being present, proactive, and in the know on all aspects of the warehouse.