Labor management has proven to be a successful supply chain tool for managing costs related to labor. This is especially critical as labor is reportedly the largest cost center in any SCM facility. This also means that it provides the most significant cost savings opportunity. Labor management systems constantly evaluate, measure and adapt day to day labor tasks with the main goal of achieving the highest level of productivity and cost savings. Its’ functional counterpart, slotting, helps to identify SKU placement throughout your warehouse facility to reduce travel times, increase picking accuracy and increase asset utilization – all of which are key factors in optimizing workforce productivity. Slotting alone has saved companies upwards of $500,000 annually and can prove even more useful when used in conjunction with LMS software. Selecting a labor management system that is built into warehouse management software can make optimization efforts even more fruitful as it allows your team to pull data from one system to anther with little to no manual data entry (where many inventory errors occur) and test slotting plans while receiving measurable results. This can help to improve the success of your labor optimization efforts.
Many SCM decision makers are hesitant to implement labor management software suites as there are common misconceptions or myths about their success and usefulness. Some of these myths include: full LMS functionality is available if I have a WMS, employee morale will be negatively impacted, LMS implementation requires significant IT resources and more. If your team can get past these concerns, find a functionally robust labor management system and implement it in a way that will help you meet your specific goals it is well worth the investment. To learn more about LMS and slotting contact Datex experts today at marketing@datexcorp.com or 800.933.2839 ext 243.