Manufacturing and Warehouse Operations best practices commonly follow the same principles. If you tour any great warehouse or manufacturing plant, it will excel in the following seven performance areas:

  • Labor productivity
  • Capacity utilization
  • Safety
  • Customer Service
  • Inventory turns
  • Quality
  • Employee engagement

Labor Productivity

All successful operations carefully manage and improve their labor productivity (also known as plant or warehouse efficiency). This is accomplished by optimizing the facility layout, to minimize materials movement, and with the adoption of 5S Visual Management to prevent employees from spending time looking around for information, materials or supplies.

All successful operations carefully manage and improve their labor productivity

Capacity Utilization

High warehouse and manufacturing capacity utilization is the key to achieving high return on assets. Utilization is measured using operating equipment efficiency or OEE. The OEE calculation is based on the actual units successfully processed divided by the total product that can be produced in the facility based on standard cycle time and a 24 hour a day, 7 day a week, 52 week a year schedule. Often when OEE is measured, managers will find that they are using only a small percentage of their capacity. Utilization is improved through the use of Quickchangeover and Total Productive Maintenance to minimize downtime on their assets (machines, trucks, forklifts, etcetera).