Productivity has always been a leading concern for supply chain companies. As the industry grows increasingly competitive and faces mounting disruptions, it’s become an even more pressing concern.
A recent survey found that nine in ten supply chain leaders say they need to increase hiring to meet peak demand. Ongoing labor shortages can make that difficult, so organizations must also make the most of their current workforce. They need to maximize their productivity.
Boosting productivity begins with finding areas where it needs improvement. Here’s how supply chains can identify and address productivity gaps.
Identifying Productivity Gaps
It can be difficult to know where to begin with productivity optimization. Supply chain leaders may feel they’re already at their peak efficiency. Alternatively, they may notice room to improve but not understand what specifically to address.
Supply chain organizations can identify productivity gaps through a few different means. Going through these three processes and comparing the results can help uncover where the most critical areas to address are.
Benchmark Against Competitors
The first step in finding productivity gaps is comparing key performance indicators (KPIs) to competitors. Recent SEC guidance requires KPIs to come with disclosures like clear metric definitions and how a company calculates them. Companies can take that information to understand their competitors’ success and how they measure it.
Once supply chain organizations have these benchmarks, they can compare them to their own KPIs. It’s important to account for any discrepancies between the companies’ metrics and measuring techniques to provide the most accurate comparison.
Comparing KPIs can reveal where some productivity gaps may lie. Even if a company outperforms competitors overall, it may fall behind its benchmarks in one or two specific areas. Those areas could be home to productivity pain points. While these differences can arise from many places, any shortcoming warrants further investigation.
Compare Goals to Results
Next, supply chain leaders can look internally. A company may perform well compared to others in the industry, but that doesn’t mean there’s no room for improvement. Reviewing goals and how recent results compare to those targets can reveal more shortcomings.
The easiest way to perform this analysis is to compare current KPIs to past goals. Has the company met the targets they’ve set in the past? Are they on track to meet future goals? The categories that show the largest discrepancies between expectations and results are likely where the largest productivity gaps lie.
It’s important to break KPIs into specific categories to isolate problem areas. At the same time, businesses must also map the relationships between KPIs to see how they affect each other. One category’s performance may hinge on another’s, so it’s important to understand these relationships.
Employees are an excellent but often overlooked resource for identifying productivity gaps. While workers may not have a complete picture of management processes, they understand their specific workflows intimately. This familiarity can give them insight into areas for improvement that management lacks.
Studies show that happy workers are 13% more productive, so the source of lackluster performance may lie in employee satisfaction. Regular surveys and interviews can help reveal which factors impact this satisfaction, both positively and negatively. Common themes between workers’ responses are likely key productivity blockers.
Similarly, employee surveys can ask about workflow improvements that workers think could help. It’s highly likely that at least one worker has noticed how part of a process slows their work down. If multiple employees talk about the same process hindering their productivity, it’s worth looking into.
Addressing Productivity Gaps
After identifying productivity gaps, supply chain organizations must work to fix them. The most effective strategy will depend on the specific gap in question, but these generally fall into a few distinct categories. Adjustments in training, work environments and technology can maximize productivity in virtually every area.
Productivity gaps often result from skills gaps. That could mean that employees lack technical knowledge and abilities to streamline their work, or it could apply to soft skills. In either case, more comprehensive training can help remove these productivity barriers.
Seemingly small adjustments can make a considerable difference here. For example, teaching warehouse employees proper lifting techniques and the importance of using them can prevent burnout from repetitive stress. Employees will then be able to work longer before getting tired, maximizing their productivity.
Similar methods can work with office staff, too. Employees should look at something 20 feet away for 20 seconds after every 20 minutes of looking at a computer screen. This will reduce eye strain, preventing the loss of productivity and focus that comes with it. Teaching office employees tips like this can help them consistently perform their best.
Address the Work Environment and Culture
A distracting work environment is another common cause of productivity loss in supply chains. Softer but more consistent lighting and comfortable working temperatures can minimize environmental distractions that hinder productivity. Similarly, white-noise machines can drown out distracting noise in office settings.
Workplace culture plays a substantial role in this area, too. One of the most important things to address in this regard is communication. Employees and managers must consistently communicate so everyone knows what others expect of them and people learn of changes or issues faster. Holding regular meetings and using instant messaging platforms can help.
Making sure the workplace is engaging and empowering is another crucial step. Listen to employees to learn what they need or would appreciate to feel more respected and engaged. When workers feel satisfied in their work environment, they’ll be more productive.
Capitalize on Technology
If workplaces face more concrete productivity challenges, technology may be the answer. Automation is one of the best tools for improving productivity, as it minimizes repetitive, non-value-adding tasks, letting employees accomplish more and remain engaged.
Some of the most valuable automation applications in warehouses are picking and material moving. Walking accounts for more than 50% of picking time, so these workflows are ripe for automation. Robots can easily handle many of these processes, and human workers can then focus on other, less inefficient tasks.
Automation can benefit office workers, too. Robotic process automation (RPA) can handle repetitive tasks like scheduling, data entry and file organization to give employees more time to perform more value-adding work. Programs that consolidate multiple processes to reduce clicking between windows are also helpful.
Optimizing Productivity Starts With Finding Gaps
Supply chains today must be agile, but to achieve that, they must address shortcomings within their operations. Recognizing where they can improve is the first step to becoming more productive.
When supply chain leaders understand and follow these steps, they can make the most of their workforce. They can then accomplish more work in less time, outperforming their competitors and ensuring future success.