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Plan, Monitor and Measure – The Cornerstones of Supply Chain Labor Management

It’s surprising how many companies have not yet considered Labor Management as their next initiative. Especially since most companies would agree that you first need to measure what the current state is to understand if the future state is an improvement right? The old phrase of “you cannot manage what you do not measure” was one of the focal points of the prior blog, so let’s pick up where we left off regarding managing your most important (and typically largest variable) supply chain cost – your workforce!

There are three cornerstones to Labor Management – Planning, Monitoring and Measuring. Your Labor Management program should be designed to support all three of those and each of them require one another to be effective. You cannot plan or monitor what you do not measure, just as you should not try and measure what you do not need to plan or monitor. For example, if you have 1 person handling returns out of 100 people, is it necessary to measure that returns process with 5 variables and discrete handling and traveling characteristics?

Planning with Labor Management

An effective Labor Management system should be designed to help you plan labor requirements by area, function, wave, or any other critieria that drives the execution of your distribution center. This plan should be derived from multiple variables supported by standards that are based on what it should take to complete the job.

Monitoring with Labor Management

We all know that the only thing right about a forecast is that it is wrong. So while a labor plan may give you a starting point, it’s important that a Labor Management system give your operational leadership the ability to monitor the workforce productivity in real-time. This real-time access to individual productivity will help managers make the necessary decisions about labor re-balancing requirements as the work plans progress during the day.

Measuring with Labor Management

Industrial Engineers know that seconds are for track meets (not labor standards) just as operation managers should know that UPH (units per hour) is for facility reports. Industrial Engineers who know work methods and measurements know that standards are in decimal minutes; and operation managers should know that labor performance of an individual is driven by work content. Utilizing multi-variant discrete standards provides a great view of labor, and coupling it with the workforce management systems to effectively track labor from clock-in to clock-out will uncover the lost time and productivity that can easily be regained. And by regained I mean get more out of what you already got.

In my next segment, we’ll look at the basics to Labor Management – where to begin and what to look for as you consider this initiative for your supply chain operational excellence.

Read Other Posts from Supply Chain Logistics Series…By Brian Lindenmeyer
Managing the Most Important Part of Your Supply Chain. The People.

myERPcloud Announces Strategic Microsoft Dynamics AX Cloud ERP Software Solutions

One-stop shop for 30-day trials of ERP and CRM solutions

San Diego, CA: PR Web – RoseASP, one of Southern California’s largest providers of hosted Microsoft Dynamics solutions, today announced myERPcloud™ will offer Microsoft Dynamics AX enterprise resource planning (ERP) software solutions for Supply-Chain Management and Manufacturing. Through partnerships with TDCI, the 2012 Microsoft Dynamics ISV Partner of the Year for United States, and Blue Horseshoe Solutions, the 2012 Microsoft Dynamics Distribution Industry Partner of the Year, myERPcloud will make preconfigured on-demand ERP cloud solutions available for trial to help evaluate customizable manufacturing suites and supply-chain management software. The myERPcloud 30 Day Free Trial site featuring Microsoft Dynamics AX, GP, NAV and CRM will launch later next month to the public.

myERPcloud will showcase BuyDesign from TDCI in a demo instance dedicated for Dynamics AX Manufacturing. BuyDesign is a Product Configurator and Guided Selling solution that helps manufacturers and their distributors streamline the buying process for customized products. BuyDesign provides a web-based modular application for guided product selection and configuration, product visualization, quoting and ordering, drawing and data generation, consumer interest creation, and more.

myERPcloud will showcase Supply Chain Suite for Dynamics AX from Blue Horseshoe Solutions in a demo instance dedicated for Microsoft Dynamics AX Supply Chain and Distribution. The entire Supply Chain Suite for Microsoft Dynamics AX includes Warehousing for Dynamics AX (WAX), Transportation for Dynamics AX (TRAX), Business Intelligence As A Service (BIAS), and Vendor Portal (VP) provides industry-specific functionality directly into the business layer of Dynamics AX’s architecture for superior performance.

“myERPcloud is a great example of how partners work together in the channel to showcase and deliver Microsoft Dynamics Cloud solutions and with the option of deploying either in the cloud or on-premise,” said Noman Akhtar, General Manager – ERP Products U.S., Microsoft Corporation. “Combining full-service partner hosting at a low monthly subscription with deep industry expertise and our feature-rich hosted ERP Microsoft Dynamics products is a very attractive offer that I expect will resonate very well with our target customers and enable our partner channel to deliver quickly and efficiently.”

The myERPcloud service has been developed by RoseASP, a division of Rose Business Solutions, a Microsoft Gold Competency Partner and Microsoft Dynamics Cloud Excellence Partner of the Year Finalist – 2012 and Microsoft Dynamics ERP Cloud Partner of the Year – 2011.

About RoseASP

RoseASP is a leading provider of hosted Microsoft Dynamics ERP and CRM applications. Since 2000, it has hosted systems for small and mid-sized companies and a growing number of Microsoft Partners around the world. With a highly skilled and experienced team of experts in hosting financial and accounting systems, related modules, and other third-party systems leveraging knowledge for customer success, RoseASP is committed to customer service. For more information about RoseASP, visit www.roseasp.com.

About Microsoft Dynamics
Microsoft Dynamics is a line of easy-to-use, integrated and adaptable ERP and CRM applications that enable business decision-makers to quickly respond to market shifts, take advantage of new trends, increase their competitive edge and drive business success. Microsoft Dynamics solutions are delivered through a world-class network of reselling partners providing specialized services and additional innovation to help customers excel in their industries.

Enterprise Software -One Version of the Truth

Can you handle the Truth?

The term “One Version of the Truth” is often overused in the IT space, but intended to describe accessibility to accurate information as it relates to Business Intelligence within the enterprise. The need for this elusive “One Version” manifests itself as the result of having multiple discrete and disconnected systems within the organization to handle very specific business functions. This may include such systems as;

  • Financial systems,
  • Forecasting,
  • Web Store,
  • Order Management,
  • Manufacturing Execution,
  • Warehouse Management,
  • and Transportation Management.

 

How Did We Get Here?

The question is…how did we get to this place of requiring all of these unique and specialized systems to perform our job?

The natural evolution of technology has led us to where we are today, a spider’s web of systems and information exchange via cobbled together batch and “near real-time” interfaces. In IT, when there is a need for more control, visibility, accuracy, efficiency, etc., that need gets designed, developed, and plugged with a new system. Over time this “build it” philosophy has led to the multitude of different types of systems that are necessary to run an enterprise. The issue is that this best of breed attitude creates a vast data puzzle across the organization, forcing all of these data pieces to be put back together in a very precise arrangement to create A TRUE VIEW OF INFORMATION.

The provisional solution to this system jigsaw architecture has been to build yet another application that umbrellas all of your enterprise solutions to mine and aggregate information into yet another database so that it can be uniformly presented to the executive team. However, this is delayed information being aggregated, old information is the same thing as bad information in a real-time transactional operation, you are making decisions in the past, not about what is happening in the present or better yet, what may happen in the future.

Colonel Jessop played by Jack Nicholson in the movie A Few Good Men said it best when provoked by U.S. Navy lawyer Daniel Kaffee (Tom Cruise); “You can’t handle the truth!”

I stand with Col. Jessup on this belief, creating One Version of the Truth in a multiple best of breed systems; multi-database world is a daunting task and one that most organizations “can’t handle” and constantly struggle with.

Are we stuck with what we have?

Do we need to stay on that wall of Col. Jessup’s and keep fighting the fight in search of unified data in the current world of duplicate master data and interfaces?
The answer is NO!

Technology evolves faster than any other aspect of our world, and there are pivotal points in history that redefine and reshape the future. In technology we can point to many such examples; the evolution of the smart phone took multiple best of breed solutions in the form of phone, calculator, email, social media, music player, internet browser, shopping/ price comparison, GPS and unified them into a singular device. A single solution that provides you with real-time decision making tools and answers at your fingertips, information when you need it to make important and informed decisions such as where is the nearest Starbucks and how do I get there.

Enterprise systems must also follow this evolution and move towards the creation of a powerful and agile business through a very simple philosophy; everyone within the global enterprise work from One Version of the Truth; a single customer master, product master, order file; inventory view, transactions, shipment file, etc. Business is real-time, organizations can no longer afford to act and react in a batch delayed fashion. Instant access to up to date and accurate information is the cornerstone of intelligent decision making and empowers every employee across the enterprise. With One Version of the Truth, customer service and sales groups have real-time access to available inventory during order entry, and shipment status while on the phone with a high priority customer. No longer does the process need to be interrupted to pick up the phone and call the warehouse, or log into a separate best of breed system to access information.

This enterprise evolution takes you beyond a transactional system and into the paradigm of a Business Process Platform; a real-time decision making platform that synchronizes information and processes across the entire enterprise to empower and simplify. Monitor, communicate, notify, and execute based on events across all aspects of your business. The fundamental requirement to achieve this level of evolution is to provide immediate access to accurate and validate data when it is required regardless of which representative, department, facility is requiring it.

Platforms that Evolve Technology

The Microsoft Dynamics AX platform provides the capabilities to evolve the technology by extending and adding best of breed capabilities within a common framework, user experience, and data model. The Supply Chain Suite for Dynamics AX is a progressive example of how the Microsoft Dynamics AX solution has been naturally extended to provide advanced logistics and distribution capabilities in the areas of

  • Warehouse Management,
  • Transportation Management,
  • and Supplier Management.

The Supply Chain Suite for Dynamics AX allows manufacturing and distribution organizations to achieve “One Version of the Truth” across their global enterprise in a business simple and powerful approach.

Learn more about these advanced supply chain solutions:  Warehousing for Dynamics AX, Transportation for Dynamics AX, Vendor Portal (Supplier Management).

Managing the Most Important Part of Your Supply Chain. The People (Labor)

Supply Chain Logistics Series: Labor Management

by Brian Lindenmeyer

As an industrial engineer who has worked in a variety of industries and verticals, my focus has always been how to get more out of what you’ve already got. And more often than not, in the supply chain of companies, it’s about labor. Labor management is one of those topics that has been around for a long time, but doesn’t seem to go away. While there are companies that have had fantastic results year after year, there have also been companies that have gone away from using the tool like they did before. Often the reason is that they claim that they have no embraced LEAN or some other continuous improvement initiative – but to say that Labor Management is not a part of LEAN is going to be something we discuss in other conversation.

The one thing I’ve learned in looking at the successes – and failures – of Labor Management implementations is that you get what you “P” for. And “P” could mean “pay”, but also “praise”, “practice”, among others.

So let’s look at why it’s important to manage labor, how you can set the right foundation to support continuous improvement, and ultimately understand how to effective plan, monitor and measure the results of your improvement.

  1. You cannot manage what you do not measure.

    My father was also an Industrial Engineer, and as a professor emeritus he stressed this to his students (and his three boys). There are a lot of measurements out there in the Supply Chain: Perfect Order, On-Time Delivery, Fill Rate, Units Per Hour, but in the end, what are you managing? PEOPLE. So if you are not measuring people, how do you expect to manage them properly?

  2. At the same time, you cannot manage all that you measure.

    The advancement in technology has created an easy means for companies to get into information overload. Reports, dashboards, KPIs, and alerts are just a few of the items that every company is proud to display. However, what is more important when you are driving, the rear view mirror or the windshield? Too often we get wrapped up in what reports show, but that’s only going to show you where you’ve been, and the key is looking for metrics and measurements that can help you navigate to a future (better) state.

  3. Understand what motivates your most important asset.

    I’m not going to say that Labor Management programs are going to point this out. But if you understand how to interpret the information Labor Management provides you, then you can equip your leadership team with the necessary tools to foster continuous improvement and operational excellence.

In the next supply chain segment, we’ll look at the cornerstones to Labor Management – Planning, Monitoring and Measuring.

ABOUT TRANSTECH CONSULTING

TransTech Consulting, A Blue Horseshoe Company is a privately held management consulting firm that has been providing expert supply chain consulting solutions to Fortune 500 and mid-market businesses throughout the world since 1983. Based in North America, TransTech assesses business needs and applies world-class business applications to improve profitability and increase efficiency. For more about TransTech, visit www.transtechconsulting.com.

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