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Safe Warehouses are Best-Practice Warehouses

DC managers are primarily focused on achieving the logistics targets for their warehouse operation. The KPIs related to the cost, logistics service, efficiency, and quality of the shipments are measured daily and continuous improvement plans are often in place to improve these metrics. In addition to being efficient, the warehouse operation should also be a safe environment for the operators. Although safety is always regarded as important, many DC managers are regularly afraid that increasing “safety” will have a negative effect on efficiency, productivity, and throughput capacity. We have found, however, that the opposite is actually the case. Safe warehouses are also well performing warehouses.

Election “Safest Warehouse of The Netherlands”

In The Netherlands, the most common location for European distribution centers in Western Europe, there was an annual contest called “The Safest Warehouse of The Netherlands”. From 2006 until 2021, this contest’s goal was to highlight good examples of safe warehouse operations, their best practices, and show how those examples can help others to improve the safety in their operations as well. Warehouses could sign up for the contest and the DC operations were audited by experts in the field of Logistics Operations, Ergonomics, Material Handling Equipment, Safety, Temporary Labor, etc.  The participants received an audit report about the status of the “safety” in their warehouses. St. Onge Company was actively involved in the jury and review process as the logistics expert and supported by auditing the logistics concept.

One of the main conclusions of the election each year was that the safest warehouse, the warehouse winning the election, also scored very highly on the logistics KPIs. We found that the safest warehouses were also best-in-class performing warehouses.

Safety in warehouses must be sustainable

To be sure that the safety in the warehouses was sustainable, contestants had to demonstrate a high logistics productivity, high logistics quality, good logistics service. They needed to show the ability to be flexible to adjust in a safe way to continuously changing market requirements. The reason for this rule was that if the warehouse operation would not perform well, that the pressure to change and improve the warehouse operation would increase and that the implemented changes could reduce the safety level of the operation.

Winners of the “Safest Warehouse of The Netherlands” award

There were several similarities between the top nominees and the winners of the election.

Some examples from the safest warehouses are:

1. Good logistics concept
   • All winners did have a good and logical logistics concept. Even older facilities, which were not really designed for efficient warehouse operations, still had good logistics techniques, with logical flows and proper working methods.
2. KPI measurement and feedback to operators
   • All winners did have clear KPIs related to efficiency, logistics service, logistics quality, near accidents, etc. The KPIs were also well explained to all the operators and were discussed with the total team. Team leaders and supervisors discussed with the operators how the KPIs could be improved and asked their support and input. The KPIs were reviewed together in the daily start-up meetings.
3. Continuous Improvement
   • All winners had a clear and structured Continuous Improvement Program. Operators were motivated and stimulated to generate improvements of their own working environment, their own working processes, and the equipment and tools to use in the operation. One of the differentiators in those safest organizations was also that each improvement idea was evaluated AND that feedback was given to the person who created the improvement idea. Although more than 50% of the improvement ideas were in general not implemented, feedback was given anyway and it was also explained why the improvement would not be used. Due to this, the operators understood the reasons why their ideas were not implemented and remained motivated to keep on generating improvement ideas.
4. 5S
   • All winners had a form of 5S (Sort, Set in Order, Shine, Standardize, and Sustain) in daily use. The operations were well organized, with sufficient space, but not more than that, to execute the processes in the correct and structured way with all required tools and equipment available. Operators were in general also responsible to keep a part of the warehouse nice and clean. For example, each warehouse operator was responsible to keep one specific aisle clean, and a picture of the operator was presented on a board on the racking in the beginning of the aisle.
5. Gemba walks and involvement of management
   • Gemba walks by the management, but also by the operators, were organized on a weekly, bi-weekly, or monthly bases. Representatives of the management team were joining the tours for about 1 to 1.5 hours per tour, together with 1 or 2 warehouse operators and observed together the operation from an efficiency, quality, ergonomic, and safety point of view. The representatives also provided a good example by following the rules, supporting in cleaning the environment, wearing vests and safety shoes, etcetera.
6. Motivation and involvement of all the operators
   • A most remarkable finding was that there was high motivation, involvement, and openness of the warehouse operators in the safest warehouses and all had a feeling of being a part of the organization. Due to this, they were a big part of supporting the improvement of the efficiency, logistics service, logistics quality, ergonomics, and safety of the warehouse operation. They had influence on the way their own working processes and environment was organized.

Several winners and nominees reported a year on year efficiency improvement of 3% to 4% per year since they started with a program of continuous improvement of the operations while also paying continuous attention to safety. Increasing the safety in the warehouse was in general a combined effort to improve the efficiency, logistics performance, ergonomics, and logistics quality of the warehouse operation.

We would like to wish you success with improving the performance and safety of your warehouse!
 
—Eric Hereijgers, St. Onge Company
 
 

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