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3 WMS Reports You Should Run Regularly

 

Regularly running reports in your WMS system is critical for diagnosing the health of your inventory and warehouse management processes. These reports can help you identify which products are raising your inventory holding costs, improve the use of your warehouse space and define best practices for your labor force.

But how do you determine which reports are the most useful to run? We spoke with three WMS experts to find out. They identified the following three reports that, while frequently overlooked, can improve your overall warehouse efficiency.

1. Vendor/Supplier Performance Report

Before a warehouse or distribution center manager can begin making changes to improve efficiency, they must first gain visibility into the inventory they’re receiving. To do this, Kirk Anderson, VP of North American sales at Snapfulfil, recommends running a report on vendor or supplier performance.

What data does this report track?

A basic supplier performance report should track all inbound shipments by product type, size or any other metric that will provide visibility into your purchase orders (POs) and help anticipate the amount of work required to receive and process them. This workload will vary for every warehouse or distribution center, so no two reports will necessarily be alike.

The report should monitor a supplier’s track record—how often are are they on time, and how common is it for orders to arrive incomplete or incorrect? Some warehouse managers may want to note additional information, such as the condition of items when they arrive, to further gauge vendor performance.

Screenshot of a vendor shipment report in Snapfulfil

Once managers gain an overall picture of what’s coming in, they can begin to manage how many employees they’ll need on staff, how long it will take them to handle and process a PO, and even how much room they’ll need in their warehouse to store everything.

What are some red flags this report can identify?

The most important issues this report can highlight are those relating to an individual vendor’s order fulfillment percentage.

“Lets say a supplier short-ships you,” Anderson says. “You were supposed to receive 100 items, but you only received 75, and you have orders for 100 items to fill. That’s going to affect your labor performance and your order fulfillment on the outbound side, because suddenly you have 25 items that you can’t pick, pack and ship.”

This report can also alert you to overdue items, flagging them when they haven’t arrived and allowing you to observe a vendor’s overall on-time percentage. If you have a recurring shipment that is only 75 percent on time, for example, you’ll have to adjust your outbound orders accordingly, which impacts how you allocate the work performed by your labor force.

How can you address these red flags?

With regards to supplier errors such as short-shipping or late shipments, red flags can be addressed by making changes to the way your labor force is managed.

“If you know that a vendor is likely going to be late, you can adjust your receiving accordingly,” Anderson says. “Maybe you have additional receiving staff that you transfer over to picking until that receipt gets there.”

Having the ability to go back and rate a particular supplier’s history also provides you with leverage when it comes time to draft and negotiate new contracts and rates with vendors.

“If a supplier is close to 100 percent on time, I’m going to continue to do business with them,” Anderson says. “But if they’re not, then maybe we need to have a conversation around penalties we’re going to put in the contract, or if I even want to keep them as a supplier.”

If red flags continue to mount around a supplier’s poor performance and methods to improve this are not successful, one temporary solution would be to increase your safety stock and/or re-order point to account for the this lapse.

While this results in higher carrying and labor costs, “it may not be avoidable if saleable products are unique via a single supplier,” Anderson says.

Anderson has seen several of his customers use supplier performance reports successfully. “One of our ecommerce customers was experiencing challenges with receiving, storing and finding their inventory, which directly affected their outbound order fulfillment and warehouse space utilization,” he says.

These challenges also required additional temporary staff to manage operations. Once the client began running supplier performance reports, however, it helped them identify that they had more receiving staff on shift than necessary, which led them to reduce their receiving and temporary staff requirements.

“By managing their inbound receipts, they also aligned their operations for efficient outbound order fulfillment,” Anderson says.

2. Direct and Indirect Labor Report

Labor is the number one cost in any warehouse, so managing it effectively has a clear impact on your bottom line. Once you’ve gained visibility into the amount of work you have to do, implementing the most efficient processes for your workforce will improve the overall operation of your warehouse or distribution center.

In order to do this, you should start with the basics. Chuck Fuerst, director of product strategy for Highjump Software, recommends running a WMS report that captures direct and indirect labor. This provides visibility into where employees are spending their time and what work they’re performing.

What data does this report track?

A direct labor report should track information such as how long it takes employees to pick an order and employee travel times to pick areas. This data can begin to provide reporting that helps optimize the layout of your warehouse and/or the travel routes mapped within it.

Capturing indirect labor activity such as employee breaks, while more difficult, is also important. Fuerst says this report should include anything not being tracked and measured that might explain why one particular worker is more efficient than another, such as how often employees are on time for work or their individual order fulfillment percentage.

Screenshot of an employee labor report in Highjump

What are some red flags this report can identify?

This report may identify discrepancies between how long it’s actually taking work orders to be completed versus what you’re estimating on the front end. “Maybe workers aren’t taking the most efficient path to pick certain products,” Fuerst explains.

One way to determine this, he advises, is to look at historical data to determine how long it’s taken to pick orders in the past, and then compare that to the current pick times your workers are logging. By breaking down the information by pick area or work region, you can drill into the direct labor data to identify the cause, e.g. product location, equipment, lack of adequate labor, etc.

Fuerst recommends drilling down specifically into pick tasks and products, because some products will take longer based upon their size or makeup. “If you have a bulkier item, it will take longer to do the physical pick,” he explains. “So then you need to ask if that location is right for that item.”

Other red flags may include discovering that certain tasks are taking too long, indicating that an employee is not performing a work task properly. You may also find that employees are abusing their break time or not accurately recording breaks.

How can you address these red flags?

Fuerst advises using red flags as opportunities for additional training. Identifying exactly what’s causing delays or other unwanted behaviors will offer insight into the specific training needed to resolve the issue.

“Maybe somebody’s stopping to talk to somebody else every time they pass them during a pick, or they’re just wasting time in between picks,” Furst says. “If you’re not measuring and monitoring these tasks, you’re not able to capture where the waste is.”

Employees might simply need renewed guidance as to the correct path for certain picks, or may need to be relocated or even terminated based on their performance.

Other ways to address red flags include deciding to align performance with incentives, such as bonuses or increased overall pay. “You might determine fair performance targets and align hourly pay rates and incentives with performance results,” Fuerst says. “Tracking direct and indirect labor would allow you to do this.”

3. Bulk Pick Report

Keeping close tabs on items after they’ve arrived and been stored in your warehouse can also produce helpful, actionable information. Running a bulk pick report in your WMS with an emphasis on the products themselves will help you optimize the pick process from the opposite end: making sure items are in an ideal location from the start, so employees can take the most efficient path when picking them.

What data does this report track?

Roark Janis, VP of global services at SphereWMS, recommends running a report that tracks products by bin location, product code, lot number, product description, order number and even the inventory status type (e.g. returned or raw materials) to be picked.

Tracking products with an emphasis on their location provides data that, like the other reports mentioned here, can be used for predictive planning when managing your labor force. For example, if you’re able to identify a bin location that holds items for 10 of your upcoming orders, using that information to make a single concerted pick will save your employees time.

What are some red flags this report can identify?

Running a picking report can highlight inefficient processes regarding how picks are carried out. While labor reporting can tell you about the individual paths employees are following en route to picks, this report identifies the locations of the items being picked, allowing employees to pick more items at once after they’ve arrived at a certain area in the warehouse.

A common red flag would show you that two items located very close to one another in your warehouse are being picked individually, when they could be picked at the same time.

How can you address these red flags?

An immediate way to address red flags is to identify product locations and batch items that appear together into one pick, rather than sending employees on single picks for individual orders. This reduces the number of picks your employees are currently running.

“The idea is that instead of going and picking 50 orders individually, you want to go to the warehouse once, and pick all 50 at once by making a stop at each of the bins,” Janis says.

These are just a few WMS reports you can run to to improve your warehouse efficiency. What other WMS reports is your business using successfully? Share your experience by leaving a comment in the section below.

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About the Author

Abe Selig joined Software Advice in 2014. As the Managing Editor of Plotting Success, Abe analyzes and writes about BI trends and tools. He also writes content related to supply chain management.

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