Categories: Management
By Mark Tomalonis
Principal, WarehouseTWO, LLC
June 2015
Got summer interns? High school and college students can be enthusiastic, tech-savvy, and inexpensive resources for your company. (Here are three articles about hiring a summer intern: “Why Hire Interns?”, “Should You Hire an Intern This Summer?”, “5 Tips for Hiring and Managing a Summer Intern”.)
We recommend that you assign to your interns projects, not regular work expected to be done by full-time employees. By having them work on projects, your company will gain benefits on things that you have put off for too long, and your interns will gain valuable experience on how your company works, and how to make it work better.
A good intern should possess these skills:
Last year, we offered a list of five projects suitable for summer interns. Click here to see that list.
Here are five more good projects that most distributors can assign to a summer intern.
I. Label Your Warehouse Shelves
Does your company’s ERP system have a “bin location” field tied to each (stocked) item record? Assigning a bin location to every item in stock makes it much easier to find these items. Particularly for new warehouse employees. Before you can take advantage of such functionality, you will need to assign location “addresses” to all of your warehouse shelf space, and apply labels to them. Suggested steps:
Step #1: Define your warehouse’s bin location schema. Common components of an a bin location are zone, aisle, bay, shelf, position
zone (e.g., tube rack, pallet rack, bin shelves)
aisle (typically defined by letter of the alphabet, starting with “A”)
bay (area of shelving between rack uprights, typically defined by a number; facing down the aisle, the left side bays are odd numbers and the right side bays are even numbers)
shelf (typically defined by a letter of the alphabet, starting with “A” as the top shelf)
bin location (typically defined by a number, starting with “1” at the left end of the shelf)
For example, location PA04E03 could be the bin location for a storage space in the pallet rack area (“P”) in aisle “A”, bay “4” (the second bay on the right side of the aisle, starting from the front of the the aisle), shelf “E” (the fifth shelf from the top of the shelving), bin location “3” (the third space on the shelf, starting on the left edge).
Step #2: Create Bin Location Labels. Using your schema defined above, a map of your warehouse and an MS Excel spreadsheet, create your bin addresses. Then, using MS Word’s “mail-merge” functionality, and Avery printer label stock, create the labels. There are fonts available to create bar codes, if desired. Of course, you can have the labels professionally printed to wear-resistant laminated labels, for a much more professional-looking, durable result.
Also create much larger labels/signs to identify warehouse zones and for the front end of all aisles.
Step #3: Apply the labels to the bin locations. Precisely. Accurately. Under careful, constant supervision. Create and use measuring devices or templates to ensure consistent spacing between labels.
II. Assign Bin Locations to all Items in Inventory
Of course, the intern project described above has no value until you assign a bin location to all of the items currently in stock. This is very labor-intensive and requires focus without being distracted by other job responsibilities. Which is why this is a great project for interns.
Don’t forget to also create a sustainable method of always assigning bin locations to newly stocked items and re-assigning bin locations to items moved from one location to another. While an intern can help define and document the process, creating the process must be done by full-time warehouse staff. This is to ensure “buy-in”.
III. Identify/Address Root Causes of Errors, via Analysis of Credits
Errors made by your employees (and customers) cause avoidable rework. Your company can reduce such rework by reducing errors. One of the easiest ways to identity the root causes of errors is to analyze credits. Assuming that you record the reason for a credit each time a credit is issued, provide one or two years’ data to your intern. Then have him/her group credits by reason. With a little additional analysis, you ought to be able to identify a few root causes. Use a combination of better training and improved procedures to reduce these errors.
IV. Identify/Address Root Causes of Errors, via Analysis of “New” Surplus Inventory
Errors made by your employees (and customers) can create “new” surplus inventory. “New” surplus inventory is defined as inventory that you own, you don’t want to own, and you’ve owned for less than one year. Your company can reduce the accumulation of such inventory by reducing errors that caused you to buy this inventory but not sell it. Provide to your intern a list of all inventory in stock for which you do not have a stock plan and was not in stock twelve months ago. Have him/her research each instance, reviewing the purchase order behind each acquisition. Categorize the reason why each item was purchased. Was it tied to a customer that was canceled? Did a data entry error cause you to buy this item? Was it put into stock speculatively? With a little additional analysis, you ought to be able to identify a few root causes. Use a combination of better training, more restrictive purchasing policies and improved procedures to reduce the creation of “new” surplus inventory.
V. Clean Up Your ERP System Databases
Entropy: lack of order or predictability; gradual decline into disorder. Given enough time, the customer, vendor and item records in your company’s ERP system get messier and messier. Consider cleaning up your system databases by tackling one or more of these common maladies:
For customer and vendor records:
For item records:
About the Author
After a successful career in sales and operations management in the wholesale-distribution industry, Mark Tomalonis is now principal of WarehouseTWO, LLC. He amuses himself by writing articles, such as this one, to help wholesaler-distributors execute their operations better. Mark’s articles and tips are published in WarehouseTWO’s monthly e-newsletters. Click here to subscribe.
About WarehouseTWO
WarehouseTWO, LLC is an independent “inventory-sharing” service created exclusively for durable goods manufacturers and their authorized distributors, and for any group of durable goods “peer” wholesaler-distributors, such as members of a buying/marketing group or cooperative. To learn how inventory-sharing with WarehouseTWO can help your business, visit the WarehouseTWO website, or email info@warehousetwo.com.