Why are you in this class? DID YOU KNOW? http://www.youtube.com/watch?v=jpEnFwiqdx8&feature=related
You can’t manage what you can’t measure Measuring & Benchmarking Chapter 3
Total Quality Management • TQM requires a new process thinking mindset. We must realize that everything we do is part of a process. Our focus shifts from managing outcomes to managing and improving processes; from what to do to how to do the processes better. Quality performance expands to include how well each part of the process works and the relationship of each part to the process. Also, process improvement focuses on continuously achieving the greatest potential benefit for our customers.
International Benchmarking Clearinghouse • http://www.quality.org/html/benchm.html http://images.google.com/imgres?imgurl=http://www.apqc.org/images/bookstore/Pure_Simple.jpg&imgrefurl=http://www.apqc.org/portal/apqc/ksn%3Fpaf_gear_id%3Dcontentgearhome%26paf_dm%3Dfull%26pageselect%3Ddetail%26docid%3D109913&h=180&w=120&sz=19&hl=en&start=1&um=1&tbnid=DM7QTNrwqW-sHM:&tbnh=101&tbnw=67&prev=/images%3Fq%3Dinternational%252Bbenchmarking%252Bclearinghouse%26svnum%3D10%26um%3D1%26hl%3Den%26sa%3DN
Benchmarking Warehouse Operations • 3 Perspectives: • Internal • External • Competitive
Benchmarking Warehouse Operations Efficient consumer response Quick response Just in Time Continuous Flow Response
Warehouse Productivity The ratio of the output of a resource to the inputs required to achieve that output Most popular and traditional warehouse performance measure = Productivity
Space Productivity The ratio of the amount of inventory storage capacity to the square footage in the warehouse
Warehousing Unit Costs • Goal: • Consumption of warehouse resources to meet the mission of the warehouse: • Shipping perfect orders and storing product efficiently.
Warehousing Performance Measures • Businesses compete on the same basis of financial, productivity, quality, and cycle time performance
Warehouse Productivity Performance • Labor Productivity: • Ratio of shipped product to hours • Storage Density • Amount of inventory storage capacity to the square footage in the warehouse. • Location utilization
Warehouse Quality Performance • Put-away Accuracy • Inventory Accuracy • Picking Accuracy • Shipping Accuracy
Warehouse Cycle Time Performance • Dock-to-stock Time (DTS) • Warehouse Order Cycle Time (WOCT)
Warehouse Performance Index • Combines: • Mission outputs (orders shipped, material stored, processed) • Resource consumptions(labor hours, sq footage, systems)
Workforce Demographics and Warehouse Performance • High performance = “systematically measure the flow”
Warehouse Size & Performance • Little support in the economies of scale in large warehouses • Penalties for improper slotting, order batching, or task sequencing are far greater • Size increases the span of control (greater need for skilled management