Your current implemented labor standard is up to date, follows a defined process, has passed a union audit and your workforce is well trained. So why is your workforce still saying that the standard is unattainable?
There are factors outside of the actual labor standard that can affect whether the standard is achievable. One factor could be working long hours. If associates are working long hours over an extended period of time, morale and cases per hour (CPH) will suffer.
We were recently at a client that had experienced a large influx of new business and associates were working 12+ hours per day over the past few months. We were asked to assess the labor standard because the associates were complaining that it was unattainable given the additional new business. Many concerns were heard, including added congestion, an increase in the aisles selected, new customer cases and outdated calibrations. In the end, we found that there was minimal change in the engineered time standards, with an impact of only 1-2% loosening per department for order selection. While making observations and talking with the associates, we discovered that the engineered time standard was not the issue, but rather the long hours exhausted associates. After 8 hours each night, fatigue set in and percentages dropped. So, we adjusted the rest and personal needs (RPN) value to account for the longer hours, which resulted in a change between 4-5% to the labor standard. But, without proper staffing, the problem will continue and the potential to lose valued associates exists.
At the end of the day, it’s important to look at all factors contributing to low morale and unhappy associates. Selecting cases is not getting any easier with low profit margins and new technological advancements. As recently as 5 or 10 years ago, less than 120 CPH was a common expectation. Today, many warehouses are asking associates to select 170-220 CPH.
If you find your workforce continually working extended overtime hours and failing to meet the expectations set by the labor standard, you may need to adjust your staffing model. West Monroe Partners can help assess the accuracy of the current model by auditing the validity of the labor standard and creating better staffing plans.