Today, we will explore the three prevalent challenges confronting warehouse managers and discuss their strategies for overcoming these hurdles. For this purpose, we interviewed Michael Currie, CEO of Fling and an expert in the supply chain industry.
What are the top three challenges faced by warehouses today?
M. Currie: Warehouses face three main practical challenges, and these are: people, hardware, and software. A crucial component is the warehouse management system (WMS), ensuring accurate information recording. If the system lacks vital data, operational KPIs suffer, hindering efficient delivery. Having fitting and functional software tailored to the warehouse is paramount for success. On the hardware front, warehouses aim for an efficient setup with well-maintained forklifts, intact and properly spaced racking. The physical infrastructure must align with the operational demands — adequate warehouse size and equipment for the daily turnover and swift goods movement. Managing expectations, whether delivering 500 or 5,000 pallets a day, necessitates having enough trucks for seamless operations. Challenges arise in handling equipment breakdowns and maintenance, adding another layer to the intricacies of warehouse management. Lastly, the human element poses a significant and arguably the most substantial challenge in warehouse management. Identifying and retaining exceptional staff is crucial but challenging, given the inherent variability. Retaining competent employees becomes problematic, impacting institutional knowledge and daily operations. High turnover rates result in a constant influx of new faces, risking the loss of essential processes and insights. For instance, every year you have to run a stock check but maybe 50% of your people have changed from the year before and they don’t know how it runs. “What do we enter into the computer, how does it work, what if there’s a mistake, all this”. To retain quality staff, competitive salaries may be necessary, impacting overall expenses and competitiveness. Balancing cost-effectiveness with employee retention becomes a delicate task.
How can a warehouse tackle these three challenges as effectively as possible?
M. Currie: To tackle these challenges, warehouses globally are increasingly embracing automation and digital transformation. Automation involves replacing human physical activities with repeatable processes run by computer or robotic hardware. Digital transformation focuses on digitizing previously recorded information to enhance warehouse efficiency. Warehouses are enticed by automating tasks initially done by humans. However, the decision hinges on factors like goods value, velocity, and warehouse size. While some, dealing with high-value goods and rapid movement, opt for fully automated systems, many supply chain warehouses find complete automation financially unjustifiable. The cost-benefit analysis often steers warehouses towards a more measured approach to automation. The critical question becomes: how much automation is justifiable? Companies like Fling provide a middle ground, offering automation that significantly reduces labor costs and facilitates consistent data collection for digital transformation. While around 5,000 out of 160,000 warehouses globally might warrant full ASRS automation, others dealing with less frequent or bulky goods might not justify even basic racking or labeling. The spectrum of goods accommodates every imaginable scenario. The key lies in finding the right level of automation tailored to the unique needs and characteristics of each warehouse.
In essence, warehouse managers face a triad of challenges: people, hardware, and software, and finding the right balance between these three is key to overcoming the challenges faced by warehouse managers and ensuring operational excellence in the ever-evolving supply chain landscape. Michael Currie, CEO of Fling.AI and an expert in the supply chain industry, has shed light on these hurdles and proposed strategies for addressing them.
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