Day: June 14, 2016

Tips to Improve Warehouse and Distribution Productivity

There are three key areas to consider in improving productivity at your warehouse, distribution facility or fulfillment center:

  1. Information flow must match physical flow. When the flow of information matches the physical flow of goods, inventories can be better managed and storage, pick-and-pack and retrieval operations can be streamlined, increasing productivity. It is important to realize that optimal inventory does not necessarily mean minimal inventory. To efficiently manage inventory and the flow of goods, look beyond weekly order statistics. Today’s global market demands consideration of complex logistics. If goods must be shipped from distant or multiple locations, maintaining a higher inventory of certain products can enable faster and more efficient customer response. Gathering maximum information about each specific facet of your operation allows you to discern customer and supplier patterns and the interrelationship of the many logistical factors that connect them. Developing a thorough understanding of “the big picture,” puts you in position to more effectively and efficiently direct the flow of goods through your facility.
  2. Know and improve your total operation first. Before implementing new technology, particularly before engaging in the requisite evaluation that precedes a major change in your operation, make certain you have a thorough understanding of every aspect of your present operation. Current processes should be honed and improved to maximum efficiency and productivity before embarking on the time, expense and training involved to implement new technology. A thorough understanding of your total operation will enable you to make optimal use of current processes and pinpoint areas that can best profit most from new technology.
  3. Automate where possible. As labor becomes more expensive and laborers become harder to find, automation is the key to increasing productivity. With the Baby Boomer generation reaching retirement age, the traditional U.S. workforce is beginning to shrink. There are fewer people available to replace the retiring workforce, and fewer young people are seeking jobs in warehousing, distribution and fulfillment. A smaller available workforce will be in a position to demand higher wages. Increased automation and, where automation is not possible, the use of equipment that allows a single worker to accomplish more tasks in less time can decrease necessary workforce and labor costs while increasing efficiency and productivity.

Material Handling Offers Good Job Growth Potential

Particularly in a tight economy everyone wants to know where the jobs are and where they’re going to be for the next decade or so. Material handling and the related fields of logistics and warehousing are growth industries that offer good job potential now and into the future. International development is predicted to drive 5% annual growth in the worldwide material handling industry for each of the next five years (see our Sept. 22 post). In the U.S. retiring baby boomers are creating critical worker shortages in logistics and warehousing. However, automation and increasingly sophisticated technology are also creating a need for more highly skilled and more highly educated workers.

While the value of experiential education is still recognized, a bachelor’s degree is the new entre into a professional career; and a master’s degree, the ticket to climbing the career ladder, according to Mike Ensby of Clarkson University’s Engineering & Global Operations Management Department. “The three most important credentialing letters today seem to be ‘MBA,'” he said in a recent interview with Modern Materials Handling, particularly if you’re aiming for the boardroom.

Companies do still hire people right out of high school, and many professionals who began their own careers that way seem to place greater value on certified skills than college degrees. But material handling is in a state of transition. Industry experts say the drive to automation and integrated systems will increasingly demand a workforce with advanced technical skills. Tomorrow’s warehouse worker is more apt to operate a computer than a forklift.

In the coming decade, high school grads may find themselves stuck in a career track that rarely rises above skilled labor, such as order fulfillment. “Going into the future, not many people will have much success in their career progression without professional development of some kind,” Ensby said.

Next time: What courses will catapult your material handling career to success? What will employers be looking for?

Education That Will Forward Your Material Handling Career

Material handling offers good growth potential now and for the future. It is also becoming increasingly automated and technical (see our Sept. 29 post). So how can students interested in material handling as a growth career and current workers who want to move up position themselves to be in demand by employers today and into the future?

Industry experts agree that education is the key. While a high school diploma can still get you an entry-level job on the warehouse floor, it will take certified skills to maintain that job as the level of technology accelerates through the material handling, warehousing and logistics industries. Moving up the corporate ladder will increasingly require a bachelor’s degree. If you aspire to a management position, plan on putting in that extra year or two to get your MBA. Some colleges now offer concurrent bachelor/MBA programs and many offer night, weekend and online courses. Executive MBA programs geared to working business professionals provide an accelerated path to a higher degree by recognizing acquired experiential knowledge.

“Going into the future, not many people will have much success in their career progression without professional development of some kind,” warned Mark Ensby, director of Clarkson University’s Engineering & Global Operations Management Department. “The three most important credentialing letters today seem to be ‘MBA.'”

As automation and the global economy drive industry to greater integration, versatility and cross-industry knowledge will be increasingly valued. Students who combine material handling courses with industrial engineering, logistics, supply chain, warehousing, project management and computer systems studies will best position themselves for the future.

Partnerships between industry associations and universities are also expected to increase experiential learning. As it moves toward the future, material handling and associated industrial engineering industries will be looking for graduates with experiential learning, not just theoretical knowledge. “Associations like MHIA are going to play more and more of an important role in leveraging universities as the provider of skilled employees,” predicted Dan Boos, president of consulting firm Gorillas and Gazelles.

Mark Tomlinson, executive director of the Society of Manufacturing Engineers, has called for public schools to place greater emphasis on manufacturing as a viable career choice. Industry pressure is expected to increase two-year technical training opportunities in manufacturing, material handling, and industrial engineering fields. Tech schools, some beginning at the high school level, are seen as a quick way of solving the looming worker shortage in these industries. “The challenge is there just isn’t going to be enough of anybody for what’s needed,” Boos said.

“Over their lifetime, many of them (high school grads) will earn more because they started working sooner than those who took four or five years to finish college,” Tomlinson pointed out. “So we’ve got to get away from a good job/bad job mindset and encourage people to get some training.”

SJF Material Handling Checks In

We were delighted to hear from one of our Minnesota brethren this week. Kent Powell of SJF Material Handling, Inc. in Winsted, Minnesota, just a couple of hours down the road from our home office in Little Falls, ran across our blog and dropped us a line.

SJF is a material handling equipment supplier and consultant. For more than 25 years, they’ve been providing new and used material handling equipment from their Minnesota base. Their Genesys division designs and engineers cutting-edge material handling and distribution systems. Services include customized consulting, layout/design, engineering and control programming services for warehousing and distribution-based industries.

You’ll find the SJF Material Handling Blog an interesting read and will want to add it to your list of “favorites.” Their blog focuses in large part on the steel market that provides the raw material for the conveyors, pallets, carousels, rack and other material handling products they sell. It provides readers with another level of insight into the issues that concern our industry today.

DJ Products manufactures ergonomic electric cart pullers and motorized cart pushers for the manufacturing, distribution, warehousing, logistics, automotive, healthcare, hospitality and retail industries. We specialize in ergonomic material handling solutions that eliminate the strain and resultant injury that occurs from manually pushing or pulling carts and wheeled equipment. We’re one interesting cog in the larger material handling wheel, as is SJF Material Handling. We know there are others out there and we want to hear from you.

We invite our readers and others who share our interest in material handling and its applicable industries to share your comments. Alert us to other interesting websites and blogs that we can share with our readers. Drop us a comment if you read an interesting blog post. Share your own experiences or concerns or let us know what you’d like to hear more about. Our goal in creating the DJ Products blog is to share news, information and insights about material handling. We’d love to hear from you. Drop us a line.

U.S. Manufacturers Turn to ‘Insourcing’ to Save Money

Insourcing is the new buzzword in U.S. manufacturing circles. U.S. economic woes are causing many manufacturers to replace outsourcing with insourcing, an unexpected boon for American workers. The declining value of the dollar against foreign currencies, skyrocketing transportation costs caused by high fuel prices, and decreasing export demand resulting from the global economic downturn are making it more cost efficient for U.S. manufacturers to produce their products at home.

The same economic forces that sent U.S. jobs overseas are now bringing them home. Manufacturing costs in Alabama are currently running 3% below those in China, causing companies like Exxel Outdoors, Inc., which makes sleeping bags for Wal-Mart and other customers, to execute an “about face” on its production priorities. Since the Wall Street tumble, the company has hired more workers, added new equipment and beefed-up production at its Haleyville, Alabama plant, while cutting production at a joint venture in Shanghai. In 2007, 60% of Exxel’s bags were made in Shanghai. This year, the company will make more product at home than abroad and expects to produce 90% of their product at their Alabama facility by 2010.

Exxel founder and CEO Harry Kazazian is predicting a 20% increase in company revenue this year to $42 million. He credits insourcing as a major factor in his company’s success during a tight economy. Since 2005, he has seen the yuan appreciate 17% against the dollar, pushing up Chinese wages, material costs and freight costs. Kazazian says moving production from Shanghai back to Exxel’s Alabama plant just made financial sense.

“Labor is China’s advantage and our weakest link,” he said. “But they can’t compete with me on my just-in-time” production cycle. Exxel can deliver a sleeping bag from its Alabama facility within three days where shipping from China can take two months.

According to government statistics, U.S. manufacturing is contracting at the fastest rate since 2001, the last time America dipped into a recession. As countries around the globe struggle with the growing financial crisis, there has been a marked decrease in export demand. Without demand for the prodigious output that originally spurred outsourcing over the last decade, producing goods in the U.S. is becoming increasingly cost efficient. Smart companies are re-evaluating their outsourcing policies and making the switch to insourcing.

Plenty of Jobs Available in Material Handling Fields

With the economy down and unemployment up, jobs are a hot topic this election. As industry starts to feel the economic pinch, plants are closing, workers are being laid off and some companies are facing bankruptcy. But there are jobs aplenty in the material handling industry and the associated industries of logistics, fulfillment and warehousing.

There’s a severe shortage of qualified industrial workers in America, particularly in material handling fields, that holds promise for job-seekers. The material handling industry is expected to be “50% short in terms of employees needed by 2010,” said Virginia Wheeler, executive director of the Material Handling Industry of America’s (MHIA) Education Foundation. The growing worker shortfall guarantees job security well into the next decade for people going into material handling jobs in warehouses, fulfillment centers, logistics operations, and factories.

“Our industry is begging for people,” said Dan Quinn, MHIA VP for education. He feels America’s high schools are undercutting the value of the trade jobs that built and continue to build America. “A lot of schools measure themselves on the percentage of students who go on to college,” Quinn criticized. “Schools should embrace the concept that non-college-bound students are still valuable contributors to the economy and society.”

The reality is that many high school students are not interested in pursuing a college education for a wide variety of reasons. Many simply prefer hands-on, physical work to sitting at a desk. Many are anxious to get out on their own and lack the interest in four more years of schooling. Many do not have the financial resources to consider college but must provide for themselves immediately after high school graduation. As the recession deepens, finances are expected to play an increasing role in education/work decisions. Some high school juniors and seniors, like Alaska Governor Sarah Palin’s future son-in-law, have already been forced to drop out of school to help support their families. Some employers are offering their employees the opportunity to complete their high school education through GED programs.

It’s unfortunate that many high school guidance counselors are so focused on college that they ignore the positive opportunities available in material handling industries. Raising awareness of job opportunities is one of the primary challenges facing the material handling industry, said Alan Howie, author of Fundamentals of Warehousing and Distribution. “. . . the essential problem is we have to get the message out there that . . . work in the material handling industry is much more than a manual labor job. It’s a career in a high-tech industry. Our challenge is to build awareness of all of this in the schools and colleges.”

What You Can Do to Attract Workers to Material Handling

By the end of this decade — that’s only two short years away — industry experts are predicting a 50% shortfall of material handling workers. Worker shortages are already being felt in manufacturing, logistics, transportation, warehousing and fulfillment venues; and it’s only going to get worse (see our November 3 post). The Material Handling Industry of America (MHIA) and other industry leaders are spearheading initiatives to build awareness of material handling job opportunities in America’s high schools and colleges, but they can’t do it alone. Each of us must work to change public opinion and entice young people into our industry if we are to survive.

In building awareness of job opportunity in the material handling industry, we will need to update our image with school counselors, students and the public at large. Our efforts to attract new workers are burdened by the outdated perception of material handling workers as unskilled manual laborers lagging at the bottom of the payment and benefit scale. Times have changed. Material handling jobs offer good pay, good benefits and a growth industry, an appealing triumvirate, particularly during the current economic downturn that is forcing many industries to lay off workers.

Of added benefit is the ability of material handling to offer jobs across the educational spectrum. While college grads and MBAs increasingly populate our industry, there is still great appreciation for the individual who moves right into the workforce out of high school, determined to work hard and make something of his life. It’s how many of today’s leaders in the material handling industry got their start, and we haven’t forgotten. The increasing emphasis on automation and system integration in our industry should appeal to the computer-savvy teens and 20-somethings poised to enter the workforce. Material handling jobs can offer young people the opportunity to reap immediate reward from their prodigious self-taught computer skills. And many employers will help workers increase and improve both their technical and business skills through educational assistance programs. The “you learn while you earn” approach can be particularly appealing during a tough economy.

So how can you help get the word out? Visit guidance counselors at local high schools, tech schools and community colleges. Let them know what material handling has to offer their students and leave some brochures they can pass out to students. Volunteer to speak at career day programs. This is a great opportunity to talk directly to students. Invite vocational high school or community college classes on a tour of your facilities and explain job opportunities. Offer summer internships or initiate a co-op (work/study) program through local high schools, community colleges or universities.  This is time-honored way to give interested students a taste of the real work world, and many co-op students become full-time employees.

Attracting future workers to the material handling industry is everyone’s job. Get out there in your community and start spreading the word. Our future depends on it.

Ergonomic Equipment Cuts Strain on Depleted Workforce

News continues to look dire for the labor market. The Conference Board Employment Trends Index, or ETI, continued to decline in October. Down nearly 12% from a year ago, the index fell to 105.3 in October, a further 2% decrease from its September level. And the future isn’t looking good, said Conference Board Senior Economist Gad Levanon who predicts continued deterioration of the labor market and rising unemployment rates well into 2009.

“The economic developments of the last two months made it clear to businesses that demand for goods and services in the U.S. is declining, and businesses are responding by aggressively slashing their payrolls,” said Levanon in an interview published in Manufacturing & Technology eJournal. “Unfortunately, it seems this environment will persist for several more quarters and business leaders will continue reducing their workforce.”

Published monthly by the Conference Board, a global non-profit business organization that monitors and forecasts economic trends, the ETI is a compilation of eight labor-market indicators:

  • percentage of workers who find jobs “hard to get”
  • initial unemployment insurance claims
  • percentage of companies with job openings
  • number of temporary hires
  • number of part-time workers working for economic reasons
  • number of job openings
  • industrial production rates
  • real manufacturing and trade sales

Whether we like it or not, in a recession most businesses are forced to trim labor costs in order to survive. It’s happening in every sector of U.S. economy. From retail sales to office workers to manufacturing, layoffs are occurring, workforces are being downsized and retiring workers are not being replaced. This means fewer workers must shoulder greater burdens if production quality and output are to be maintained.

Ergonomically-designed equipment easily enables a single worker to do a job that may previously have required two or more workers when performed manually. By transferring physical effort from the worker to the equipment, ergonomically-designed carts and equipment movers allow business owners to effectively reduce their workforce without taxing their workers.

Ergonomic equipment is designed to prevent the expensive and debilitating musculoskeletal injuries that plague manual pushing, pulling and lifting tasks.  The introduction of ergonomic equipment and ergonomic practices into the workplace have been shown in countless studies to immediately reduce worker injury, decrease associated medical and insurance costs and improve worker morale and productivity.

To find out how ergonomically-designed equipment can help you maintain production values with a depleted workforce, talk to the ergonomic experts at DJ Products.

Tips for Creating a Successful Ergonomics Program

Last time we talked about the financial and production benefits of implementing an ergonomics program (see our Nov. 24 post). A recent study on the bottom-line value of ergonomics showed a $4 savings for every dollar invested. Most businesses that purchase ergonomic equipment recoup their investment costs within the first year. The financial benefits alone make ergonomic equipment a shrewd investment in your future. But forward-thinking businesses that investment in ergonomics understand that they are also making a powerful proactive investment in the health, safety and retention of their workforce.

Creation of a successful ergonomics program requires three important elements, Mike Kind wrote recently in the New Hampshire Business Review:

Support of top management. To be successful, an ergonomics initiative must become part of your corporate culture and be thoroughly embraced and supported by top management. The introduction of an ergonomics program can be an excellent step toward creating a wellness-based focus in your organization, notes Kind.

Other wellness-centered activities include offering wellness training classes, scheduling health screenings and flu shots, providing healthier snacks and beverages in vending machines, sponsoring Weight-Watchers groups, offering gym membership discounts. Employers only stand to gain from sponsoring activities that promote a healthy workforce.

Established goals and measurable results. Any new initiative requires a bit of tweaking once it’s off the launch pad. Particularly in the early weeks of a launch, it’s important to conduct regular workplace assessments of a new ergonomics program to ensure that maximum efficiency and productivity are achieved. Close monitoring of employee complaints, injury reports, medical costs, workers’ compensation claims, absenteeism, lost man-hours and production results will provide the hard data needed to assess the success of your program and make any necessary changes.

Kind adds a word of caution: Don’t be surprised if you find an initial increase in incident reports. As employees learn about ergonomic issues, they are more likely to recognize the symptomatic causes of musculoskeletal complaints and report them. As your ergonomics program progresses and becomes an effective component of corporate culture, incidence reports will decrease significantly.

Next time we’ll discuss the importance of effective education, training and leadership in implementing a comprehensive ergonomics program in your workplace.

Successful Ergonomics Program Requires Strong Leadership

With President-elect Obama and a Democratic Congress poised to enact tough ergonomic standards within the next year, we’ve been discussing the financial, production and personnel benefits of implementing an ergonomic program (see our Nov. 24 & 26 posts). Being proactive in creating a wellness-focused corporate climate will enhance your ability to compete in the future. Implementation of a strong ergonomic plan and a move to ergonomically-designed equipment has been proven to increase production efficiency and decrease healthcare costs.

The success of a comprehensive ergonomics plan is dependant upon the support of top management, the creation of demonstrable goals and measurable results, and, most critically, the provision of effective employee education and training coupled with strong program leadership.

Effective education, training and leadership. Thorough education and onsite training of employees is critical to the success of a new ergonomics program. Education about the features and processes of a new ergonomics initiative must be backed up with onsite training.

As workers become familiar with new features and practice new processes, the provision of adequate onsite supervision is critical. Workers need time to learn new skills and procedures and change long-established habits. Continuous supervision not only reinforces raining, but reveals areas that require adjustment. Ask your employees for input. People who perform the tasks often spot potential problem areas in new procedures and provide keen insight into productive solutions.

In an article published in New Hampshire Business Review, Mike Kind also recommends selecting a “champion” to spearhead a new ergonomics initiative. Designating a person with clear oversight over the program facilitates implementation of the original initiative and subsequent revisions. It creates a clear chain of command easily accessible by both management and workers. It centralizes the dissemination of information and collection of review data, improving analysis quality and speed.

A recognized industry leader in the design and production of ergonomically-designed material handling equipment, DJ Products provides a useful Ergonomic Load Calculator on our website. Created to assist ergonomic and health and safety professionals in designing ergonomic programs, our free calculator estimates the amount of horizontal force necessary to move wheeled loads. By inputting vital data about your specific application, including floor condition, terrain, footing, load weight and transport distance, our Ergonomic Load Calculator calculates the specific needs of a given application.

DJ Products’ ergonomic specialists are also available to assist you in evaluating your ergonomic needs. We’re the experts in finding creative solutions to ergonomic issues in the workplace. Give us a call today and let us help you position your business for the future.