The Problem with “No Problems”

Warehouse managers might think a report of “no problems” means their warehouse is running in top form — but there is a big problem with a report of “no problem.”

You’ve probably heard the story of the Toyota executive who, while touring a plant, asked about the problems that factory faced. When he was told there were no problems, he noted that if there were no problems, there was no need for a manager.

This illustrates a key management lesson that is especially applicable in warehouse optimization: if no problems are being reported, then no improvements of efficiency are being made.

Warehouse optimization is all about continually improving efficiency; a turnback is anything that causes a deviation from the established system. In order to address any inefficiencies, we recommend you tackle them in three parts:

  1. Turnback Collection: Identifying problems or inefficiencies that exist
  2. Turnback Response: Addressing and fixing the problems so they don’t happen again
  3. Implementing Change: Learning from your experience by implementing sustainable improvements

If, while a worker is packing a box, they notice there is an item missing and they leave their station to locate it, this constitutes a turnback. A vigilant manager would notice this deviation and ask what had caused the turnback, but ideally, the worker would report the missing item before starting his or her own search for it. The name of the game is getting these turnbacks reported so that action to remedy them can be taken.

Managers should be constantly on the lookout for turnbacks. While the workers in the warehouse are usually the ones best suited to notice an immediate problem, it is the manager’s job to build an environment that encourages all employees to actively identify these problems.

There are many methodologies in collection turnbacks. They can be as simple as a white board and as extensive as a high-tech Andon system. Following the Lean 5S methodology can also help with collecting turnbacks.

Once a turnback is reported, it’s important to analyze the problem and discover its source. Why is this happening? Is it a substandard ID system? Is there a discrepancy in the order forms, or human error? Is the pick/pack process poorly engineered? Once the problem is identified, the solutions can be formulated that can change future outcomes.

Developing a Culture of Change

It’s crucial to act quickly and proactively to resolve whatever problem is causing the turnback. The act of solving the problem and implementing a change as a part of your warehouse optimization process acts as a positive reinforcement of problem-reporting behavior, in that the changes result in tangible improvements. Inverse reinforcement is true when nothing is reported — the lack of change perpetuates a culture of shrugging off inefficiencies by indicating the feeling that “it won’t matter.”

It’s easy enough to implement a rule that problems should be reported — it’s another thing altogether to create and maintain a culture in which speaking up about inefficiencies is accepted and encouraged. Many workplaces may say that they’d like to know about inefficiencies, but in effect punish workers who bring turnbacks to their attention by ignoring them or even blaming them for the problem. Or worse, the turnbacks negatively impact a facility’s dated operational KPIs that ultimately affect the employees’ annual performance.

There is an obvious and fundamental difference between warehouse operations that talk about Lean on a project or function level, and a company that values improving the lives of its employees by engaging them in process improvement as a part of the culture.

In a true Lean warehouse, reporting problems is seen as a good thing — an opportunity for improvement and an important part of warehouse optimization. Many companies will talk about Lean practices in terms of standalone functions like reducing headcount, cutting costs, etc., and the results are clear: dissatisfied customers.

If your workers and managers aren’t finding the problems in your warehouse, you can be sure your customers will. And that will be a big problem.

Andy Dishner is Senior Vice President, Client Solutions at LEGACY Supply Chain Services. He is a seasoned professional with 22 years’ leadership experience in multiple areas of the Supply Chain Industry. Andy has worked for both shipper and 3PL in various leadership roles, starting his career in distribution and fulfillment for a major Retail/Catalog Company. In his 15 years with LEGACY SCS, he has worked in many operations and business development roles, where his efforts have resulted in supply chain efficiencies and bottom line savings for a host of Fortune 500 companies across multiple industry verticals. Currently, he leads LEGACY’S solutions development team which engineers fully integrated supply chain services to include Value-Added Warehousing, International & Domestic Transportation, Customs Brokerage and Installation/Project Management. Andy received both a BS Degree in Logistics and Transportation and an MBA from the University of Tennessee. He is an active member of several Industry organizations including both WERC and CSCMP.