• Miebach India

How to improve productivity in my warehouse?

The plight of managers at distribution centers with manpower intensive operations is no different from the farmer who had to carry his goat, wolf and a bag of cabbage in a rowboat across a swelling river .

In a geography where project viability calculations almost invariably work against automation due to manpower cost arbitrage, distribution center managers are in considerable trouble if they automate and doomed if they don’t. The solution to this seemingly paradoxical business problem is fairly simple – continually looking at ways to improve manpower productivity at distribution centers till such time partial / full automation begins to make business sense.

If you are asking where to start looking, may be this post will help.

 As-Is and To-Be Value Stream Maps

 Creating a current state value stream map for the distribution center is most often a quick yet reliable way to identify improvement potential. Value stream maps help the distribution center managers to separate the wheat from the chaff by identifying value added and non-value added activities amongst the entire set of activities carried out at the distribution centers. From this As-is, a future state can be arrived at by identifying the Good, bad and the ugly.

 Good, Bad and Ugly

Once the value stream maps are in place, it is easier to take the three dimensional “Good –Bad –Ugly “ approach to improving site productivity as below:

  • Improving efficiencies at all value adding steps
  • Minimizing value erosion at all ‘unavoidable’ non-value added activities
  • Removing all redundant non-value added activities

Productivity improvement at distribution centers typically come from changes in three major areas as below:

  • Process
  • Layout
  • Storage and material handling techniques

 Changes to storage and handling techniques at distribution centers are normally a direct function of available capital budgets and site constraints. Hence, identification and implementation of “Quick wins”, steps with highest impact potential which need little or no capital investment is most often the logical first step.


 While every distribution center has its own set of challenges, few fundamentals like the ones mentioned below work like a charm almost everywhere:

  • Dispatch velocity / cube based SKU slotting: Basically this means that you use your most easily accessible locations for the fastest moving products. Think of lowest racks, or racks near the docks, or even block storage near the dock in some cases.  What most people forget while using slotting, is that the fastest product changes from time to time and it is not enough to slot once in 6 months or even a quarter. When running promotions, for instance, the promoted product is likely to run at a much faster rate than usual, and should be placed in easy-pick areas.
  • Zoning: Zoning is keeping items in such a way that average pick tours are shortest. It could involve variety of algorithms. For e.g.: keeping items with similar order characteristics together, so that an entire order can be picked with minimum travel, or keeping fastest moving items in a zone closest to the docks.
  • Heijunka (or going visual): Using mail slot like systems (Heijunka – as shown in the picture below) for lining up products and orders is an effective tool to share the picking sequence with the picker so he travels less. Picker completes his/her assignments in the allocated sequence, gathers the product, returns it to the staging area, and then repeats the process. If zoning has been done properly, pickers can be assigned to specific zones only – which also has the benefit that there will be regulated aisle traffic.

Heijunka Box (Image courtesy Wikipedia)

  • Provision of adequate staging areas and aisles: This is an important consideration while designing a warehouse. A smaller staging area will inevitably lead to detours of pick trucks, or material overflowing into aisles. Smaller aisles are even more inefficient as they will slow down the trucks. While the rising rentals may tempt you to keep your non-storage area to a minimum, a penny saved there will cost you a pound in under-utilized equipment and labour.
  • Ergonomic and Safe work practices: A worker who is scared of having some boxes fall on him, or one who is bending down to the ground floor every second minute, will never be able to work as well as he could (Did you think otherwise??). Make him feel safe and comfortable before driving him to reach those productivity goals.
  • KPI & Measurement: Ofcourse, you can’t fix something till the time you know its broken. So measure your operations – how many picks you do per man hour, how many tons do you put-away every hour, what is your picking frequency from each zone, what is the pick to dock time – all these will, like the value stream, point you in areas of reinforcements.


 Productivity improvement is a never ending journey of on-going improvements towards an utopian state called perfection. Like they say, the journey itself is the reward!

If you have some thoughts on improving warehouse productivity, please share them with us.

Debottlenecking brown-field distribution centers to achieve significantly higher manpower productivity (with little or no capital investment) is a key service offering at Miebach Consulting. Miebach has successfully re-engineered operations at many distribution centers across industry segments like Apparel, Automotive, FMCG, Pharmaceutical industries etc. 

For knowing more about this service and our success stories in supply chain consulting, please write to mcindia-mkt@miebach.com

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