How to Create a Warehousing Strategy Geared Towards Growth

Published : May 24, 2016

Warehouse picker-packer

The very concept of optimizing warehousing and logistics has completely changed shape and boundaries since the emergence of the omni-channel movement. Rather than a single, clear road to success, keeping fulfillment capabilities on par with business growth has become more like several concepts simultaneously navigating a maze that changes from moment to moment. It can be dizzying for a strong, slow-moving portion of a company like traditional warehousing to keep up with the fast pace of change. But for a business to remain wholly competitive, it must develop a warehousing strategy that mimics or surpasses the ambitions of sales and marketing efforts — otherwise the latter will quickly outpace the former. But how can an evolving company effectively transfer and apply techniques designed for another department to the heart of their fulfillment center?

Step One: Buff Out Your Supply Channels

The first step towards optimizing a growth-oriented warehouse is to ensure that incoming product or component channels are free of obstacles or other “traffic jams.” While workarounds typically caused minimal disruption when fulfillment was more of a cut-and-dry process, they add unnecessary cost and effort when viewed through a lean, efficiency-driven lens. In a recent article for Supply Chain Nation, Thad Zylka advises warehouse professionals to work with their suppliers to incorporate clear supply chain collaboration, expectations and progress reports, each keyed to keep partnerships functioning at peak efficiency. Slowdowns, late deliveries and similar negative trends are immediately highlighted through these measures, allowing inefficiencies to be discovered and addressed. 

There is often a measure of hesitation involved when it comes to big changes, particularly in something as entrenched as a fulfillment center. However, it's important to consider the risk-vs-reward of marketing actions companies take every day. It's not unusual at all to design and implement a new ad campaign or to extend sales channels into new venues in the name of securing more profitability. Warehousing teams need to embrace this concept in their own operational planning; not to the end of disrupting necessary workflows, of course, but through utilizing tactics that almost certainly fall outside of their well-defined comfort zone. Experimentation — and, yes, even failure! — is a normal part of growth. The key is not to bet the farm on every hand, but to dole out risk in a responsible, well-managed way. 

Step 2: Don't Treat Your Warehouse Like an Island

“The warehouse” and “the office” shouldn't be treated as two neighboring, yet separate countries. The actions of one directly affect the other, and sending emails and messengers back and forth with snippets of information won't support the strong, collaborative environment necessary for growth. It can feel unusual to chase down additional internal transparency, particularly if cost-cutting measures or budget allocations are on the table. It's still vital, however, and an important step in not only growth, but sustainable growth. Finger-pointing and disastrous operational decisions all have their root in lack of communication. Scheduling periodic “state of the warehouse” meetings will keep everyone on the same page, rather than jockeying for position. 

While proprietary information needs to be safeguarded — to a point — from the prying eyes of external actors, there should be few secrets within your company walls. If you find yourself habitually hedging reports or holding your cards close to your vest, you are likely working in an unhealthy informational relationship. Is it uncomfortable to confront communication or expectation issues? Of course. But living around them is doing your entire team a disservice. Problems can't be remedied if they aren't exposed, and it's rare that issues like these do anything but fester over time. When they're discussed matter-of-factly and as soon as possible after they appear, they don't have the chance to infuse the wrong kind of growth into your company interactions.

Step 3: Get Your Transportation Providers On Board

You can do everything perfectly within your warehouse walls and still fail to hit the delivery and fulfillment targets you're aiming for when the supply chain doesn't truly end until your finished product is in the customer's hands. Some companies would even extend this into perpetuity by tying in reverse logistics. This means that incoming data streams are particularly important in managing your third party logistics providers. If you aren't currently working with transportation and shipping providers that make real-time data available, it's well past time to either demand access or switch to a company that does. 

Technology is a necessary component for the trucking industry in particular, thanks to a new ELD (electronic logging device) mandate that went into effect earlier this year. Their requirements can easily be used to your benefit, provided they agree to make collected information available in real time. Imagine the efficiency boost to your warehouse workflows when your team knows exactly when a shipment is arriving, rather than depending on a trend window. Consider the positive customer perception of a company that proactively provides tracking information for incoming defect returns. These are benefits of making transportation providers a partner in your warehouse approaches, rather than treating them as a necessary, static component of getting items from point A to point B. 

Step 4: Accept that Change Is Not a Destination

To reiterate, you can do everything you set out to do in order to invite growth, yet still find it elusive. Change and growth are inexorably linked in the journey to improvement, and that means that your shelving might need to move, your inventory systems might need to change, and warehouse-wide adjustments need to be made over time.  The worst fallacy that a supply chain professional can embrace is that “if we just do X or achieve Y, we'll be fine.” Growth can't exist or flourish in a stagnant environment, and a culture of relay race thinking within a company stifles it. Instead, commit to small, controlled experiments with an eye towards wider implementations in the case of success; continually study the methods used throughout your industry and enthusiastically discuss acceptable risk spend with higher-ups in pursuit of better efficiency and versatility within the warehouse

The best warehouse managers do not merely follow a company-provided script, they keep watch over the SWOT matrix and actively minimize problems while pursuing potential improvements. Growth needs to start with warehouse strategy, certainly, but that begins with the attitude of a decision-making individual, and the way he or she approaches the C-suite when it comes time to decide on direction. The challenge is balancing the demands of operations and the burdens of growth with equal measure, but here's a hint: it's much easier to start on that foot than to try and catch up later on. 

Your warehousing strategy needs to remain influenced by a variety of external factors — demand in the marketplace, the actions of your competitors, the state of the logistics network — as well as internal ones in order to remain healthy enough for growth. As the saying goes, if you aren't moving, you're standing still. In business, that's a recipe to fade into obscurity. Fight to stay on top by focusing on a growth-driven strategy for your fulfillment center and eliminating the obstacles that remain the relics of a pre-internet age of commerce. 

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Topics: Warehouse Management

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