How to Use Data to Improve Labor Standards and Warehouse Performance

Labor Standards are essential for warehouses to track productivity, identify areas for improvement, and make informed decisions about staffing and scheduling. However, traditional labor standards can be time-consuming and expensive to develop, and difficult to maintain.

Warehouses without engineered standards often are blocked from implementing a Labor Management System (LMS) or Continuous Improvement program that can lead to significant labor, cost per unit (CPU), or cost per order savings.

Data driven labor baselines offer a cost effective and accurate alternative to start measuring performance and driving improvement. It is important to recognize that baselines are not the same as engineered standards. Engineered standards are in depth engineering effort with time motion studies, process analysis, and human factors analysis. Baselines are a benchmark of historical performance by cohort of employees, 3PLs, facilities, etc.

Baselines use historical data from warehouse operations to calculate the time it takes to complete tasks. Takt makes it easy to identify processes within your warehouse and start developing baselines using the Takt Rate Analyzer. Takt identifies all the necessary data points, filters out outliers, and creates a performance distribution that helps operations teams and/or engineers to develop accurate baselines of performance.

This allows engineering and operations teams to focus labor standards development or process improvement for the most critical processes first while measuring performance against the baseline.

Takt enables leaders to easily create rates and recommends rates based on industry best practices. For example, Takt recommends that 25% of employees should be hitting a standard on any given day.

If your warehouse does not have engineered labor standards, then data driven baselines are a great option for focusing teams on the most critical bottlenecks while introducing an accountability program. Data driven baselines can be developed based on as little as a week of data and can be scaled across your network of facilities.

Creating standards or baselines is not a one time event. Standards and baselines need to be maintained and adjusted as the organization improves, processes change, or equipment of the floor changes. Takt makes it easy to measure the accuracy of standards and baselines so that engineers can ensure rates are correct and kept up to date. Accurate standards are critical to the success of any employee, manager, or facility incentive program. If the employees lose faith in the accuracy of performance the program will lose steam and fail to produce the desired results.

If you are looking for a more accurate, efficient, and flexible way to manage labor standards in your warehouse, then data driven baselines are a great option for getting started quickly and then maintaining standards and baselines. If you are interested in learning more about how Takt can help you maintain engineered labor standards or develop baseslines, request a demo!