Where is the Weak Link in Your Fulfillment?

Sometimes, outside of meetings and performance reviews, managers will refer to employees who are the “weak link” in their processes, especially when it comes to fulfillment. But it is rarely the employees’ fault. Most problems actually stem from outdated methods.

Consider the chain of events that occurs in a purchase, from marketing to purchasing to fulfillment and customer service. There are many steps that need to occur, and information has to flow from each step to the next. Any errors that get injected into this process will cascade down the chain of events, causing problems.

Here’s an exercise, then: Consider the various ways in which errors and inefficiencies can occur in this chain of events and what causes them. In speaking with fulfillment managers, our experts have identified quite a few, including:

• Typos and other errors in entered shipping and billing information at time of purchase
• Shipping and billing information not compared to historical order information to spot potential errors
• Stock levels not adjusted in a timely manner, leading to backorders
• Stock not stored in an appropriate location
• Forward staging not used for efficiency, or forward staging information was not made readily available
• Allocation and/or lot mixing rules violated
• Picking paths not optimized
• Lack of appropriate checks for order accuracy
• Manual entry of data into shipping system introduced errors

These are just the tip of the iceberg. Notice that these errors are not necessarily due to employees being lazy, careless, or insufficiently trained (in fact, errors tend to occur when employees are overworked). Many of them occur because human error is a fact of life. Automated systems, with appropriate checks and balances implemented in real time, are needed to minimize errors and correct them when they do occur.

The correct course of action to take when fulfillment runs into problems, then, is not to identify underperforming employees. The first step is making sure that processes are set up correctly, using automation and appropriate checks on the system.

What should this entail? We recommend starting with these three steps:

Review Your Process

At the risk of sounding obvious, the first step in changing your processes to avoid problems is to review processes to see where the problems are. For example, where are the bottlenecks occurring? Where is erroneous data entering the system? Ordering? Receiving? Shipping? Is speed the problem, or accuracy? Or both? And are the problems seasonal, coming when demand is greatest, or do they persist throughout the year? To the best of your ability, you need to get clear on the actual problems and zero in on the steps at which they occur.

Stop Relying on Manual Data Entry

Manual data entry is the worst option for keeping a warehouse or inventory database, right after “no data entry at all.” A slightly better alternative is to find ways to integrate various systems across the organization. For example, is there a way to integrate your WMS with your shipping stations? With the organization’s accounting software? (Even here, the type of integration matters. Integrating your standard ERP will be tougher than a software solution using APIs, for example.)

Even better would be finding a system that natively incorporates these functions from the start. Instead of piecing together software solutions and hoping they can “play well” together, a good warehouse leadership team will invest in a system that already has inventory, labor management, receiving, and shipping capabilities, and that is compatible with most shopping cart and accounting software “out of the box.”

Start from the Back and Move Forward

Different stages of warehouse and fulfillment operations require focusing on different values to shape management and operations decisions. So, while each step in your process might present problems or inefficiencies, it is important to look and see how each stage affects the whole.

For example:

• Accuracy should be the main value informing positive changes at the receiving stage. Ensuring accuracy means a focus on automation and quality control, as well as efficient planning and proper storage according to defined mixing rules.
• Prediction and planning are needed when it comes to picking and packing. Pick paths should be optimized, and forward staging should be used for fast-moving items. Data integration here is key to make sure that these efficiencies are found and communicated to workers on the floor. Room should be made for returns and dead stock in order to avoid mix-ups.

• Efficiency and flexibility should be the focus in your shipping department. It should have the ability to automatically generate packing slips and shipping labels, find the optimal packing methods and materials, and allocate labor as needed.

Solving issues at any one stage can help all of them. For example, more accurate receiving and storage will cut down on picking time and errors. Forward staging will speed up packing and shipping, which in turn allows more time for shipping to do its job. (More details about these three stages can be found in our white paper on the topic.)

Where Are the “Real” Weak Links in Your Fulfillment?

Looking at these three steps, it should be apparent that there are many areas of warehousing and fulfillment where problems can occur and efficiencies can creep in. What might look like an employee problem at first may actually turn out to be a systems problem. (And if you can’t see what the problems are, it might be because you are relying on a hero instead of proper systems.)

Taking a step back to review the state of your operations might be well worth the investment in time. Nothing is more costly than misdiagnosing a problem.