It isn’t news to anyone that many industries will be facing a slow recovery in the coming months – even years – as different places around the world are at various stages of recovery from the COVID19 pandemic.
Warehouses have seen sporadic changes over the last 4-6 months from changing consumer demands, increased freight volumes, both increased labour demand for essential services and layoffs for non-essential production, and retooling machines to meet changing demands. All of this, coupled with amplified health and safety risks, creates a challenging environment nobody could have been prepared for. While many of these changes came overnight, the recovery back to what is considered “normal” will be much slower, if it comes at all.
In many parts of Canada such as Ontario has only recently tentatively moved into Stage 3 of recovery and in the US, many states are slowing down or reversing business openings because of new waves of cases. This could signify the start to a return to normal, but there is a long way until consumer spending, supply chains and demand planning return to what they once were. One thing is certain. The effects of this pandemic will be with us for a very long time.
Warehouses have begun re-staffing or re-planning shift structures, but they may have done so too soon. The looming threat of a second wave means warehouse planning and inventory management is more difficult and uncertain than ever. However, periods of disruption can also create new opportunities and a platform for a paradigm shift to make operations better than they were before if you plan effectively and prepare for a drawn our recovery period.
This is not a seasonal transformation where things will bounce back after a spike in action. We are experiencing a global transformation in how we live our lives, think and act. Opportunities must be aggressively pursued. As mentioned above, it will be increasingly risky to make decisions and big changes, but it is time to leap. Fight your natural tendencies toward inaction when uncertainty abounds.
Protecting your employees’ interests and well as their safety will make them want to come to work and serve the organization to their best. Engaged employees who feel valued at work are more productive and more likely to go above and beyond in their roles. If changes will need to be made in the near future to processes and operating procedures, employees who feel safe, valued and are committed to the company vision will also be more open to change.
If cost-cutting needs to be made, consider cutting other expenses before employee salaries. Alternatively, consider reducing hours for all employees for a short period across the board and allowing employees to retain their benefits. At the end of the day, many of these staff will have to come back and you don’t want to burn your bridges or create a toxic environment when things do start returning to normal
It can be hard to find a vendor who can serve your company’s needs, provide good products and a good price. Like you, they are also likely facing new challenges including overwhelming demand and/or reduced cashflow. Understand that some vendors may not be able to pay invoices on time. Consider creating ore flexible payment options for the short term instead of burning relationships with quality vendors. This may create resentment across multiple fronts once your business finally recovers. Sometimes having a reliable vendor can be more beneficial than speed.
Transparency in warehouse operations is key. Increase communication across the warehouse, between employees and leadership, between leadership and consumers and between the warehouse operators and vendors. Communicating relevant information can create a motivated and prepared workforce working toward the same goals. It also ensures that everyone is on the right track and aligned with the same vision.
Think of the voice of the customer. Customers who buy from your company care about the safety measures put in place to protect them and your employees. They want to know if their products will be delayed, and by how much because of recent circumstances. Communicate safety measures, shipping delays and other concerns in your branding and marketing material.
Throughout nearly six months of the crisis, the closing and reopening of economies has thrown out of sync the usual seasonal flow of goods from China and other large manufacturing hubs, rendering forecasts useless for shipping plans. This makes the future hard to predict.
Automation and new digital technology can handle the unpredictability of today’s circumstances more effectively and efficiently then many manual tools can, by using data to make decisions and meet customers’ needs quickly. Warehouse operators can use digital platforms to manage inventories, dock to stock, production capacities and more.
A warehouse automation system can help maintain inventory balance, shifting away from just-in-time or just-in-case inventory and moving towards a system that creates products as customers order them, saving both time and space waste. E-commerce and omnichannel shipments can also be navigated easier. It can identify alternate distribution channels or delivery routes and transportation schedules to narrow delivery windows. It can also manage shift schedules to ensure compliance with social distancing and safety regulations and reduce staff shortages.
In a recent webinar we hosted with Supply chain expert Jim Tompkins, we discuss the idea of “optionality” vs. “optimality” where supply chain, warehouse and other fast-paced industries must have prepared several options available so they can pivot on a dime and make quick decisions. More data (and the ability to make use of it) means more informed, rapid decision making and the reduction of human error, allowing you to pivot between multiple options quickly.
Warehouse management systems, blockchain technology and robotics have enabled warehouses to be smarter, more transparent and more agile. Once the initial shift is made during crazy times, companies can start to implement more long-term geographic or business model realignments to reap the full benefits of an automated system including narrowing delivery windows, reduced labour costs, faster production times, diminished risk of processing errors, increased productivity and efficiency and better management of inventory.
Warehouses are some of the biggest hit from this pandemic, and they must accept their new reality and in doing so, must be proactive, take risks and protect their most valuable assets. The Poirier Group is a trusted partner for many manufacturers across North America, creating sustainable solutions in their warehouses that save them time and money while creating alignment throughout their teams. Contact us to find out more about how we can help you optimize your warehouse and navigate your organization through these uncertain times.