Waste and inefficiency frustrate your team, annoy your customers, and take a toll on your company’s bottom line. Preventable waste is the worst kind, and an excellent place to stop wasting is with your Enterprise Resource Planning (ERP) system. How can businesses overcome ERP time wasters in their product-centric company?
When it comes to product distribution, the many steps involved leave lots of room for wasted time and resources. Some of the significant categories of waste involve sluggish order fulfillment or even outright dysfunction.
The first step is identifying processes that may have worked in the past but are now holding you back. We’ve identified some common time wasters. See if any of them apply to your company, then consider our suggested solutions.
Defective products
This form of waste is exactly what it sounds like: your process allows shipping the wrong product, or the product becomes defective or broken during shipping. That shipment represents not only wasted products, shipping costs, return costs, and more, but also potential costs in customer dissatisfaction. Defective waste can be unforeseen and, therefore, difficult to prevent. But with proper planning, you can minimize it.
The solution
Distributors can’t always prevent defective products or breakage during shipping. Still, with sufficient planning, you may be able to identify the problem before it results in a loss of time, money, and customers.
Of course, this will require real-time insight into your pipeline so you can track inventory touchpoints and identify potential hazards. Establish workflows for tracking each order, from entry to fulfillment, and check on your products at each step or stage of their journey.
Product delays
Backlogged materials and stagnant inventory have no value to your customers. The more time that products remain in these stages of your operation, the more resources you are wasting. It’s crucial to keep your products moving from manufacturer to warehouse to distributor as quickly and smoothly as possible. You’ll have to look for logjams and delays along the way.
The solution
Automating your processes where possible is going to be a game-changer. Why squander resources processing orders manually when so many other items beg for your team’s attention? Customize your automated processes to run scripts, forward documentation, and update batches. You'll save your team a lot of time and headache, and minimize opportunities for human error.
Human resources waste
Often, it’s not a question of product waste, but the manpower required to keep things moving. Your workflow can get backed up when next-step actions are delayed. These delays could be caused by employees not having the skill or the authorization to proceed, or by authorized persons being unavailable.
The solution
The solution to this bottleneck may depend on the upper-level management of your company. They should evaluate how their teams function in each role and department. Perhaps a reorganization of talent could give operations a boost. Employees may need training and a more intuitive technology solution to reduce non-value-added efforts. Improved collaboration between departments and the automation of authorization where appropriate will also help move products along.
Wasted motion
Motion waste refers to the idea that your product may be moving through several processing steps but not getting any closer to its end goal. Inefficient driving routes or a poorly organized warehouse can significantly contribute to the sense of one step forward and two steps back.
The solution
When optimizing your warehouse to avoid excessive movement, you must ask yourself one key question: are you tracking or managing your inventory? They are not the same. To manage your inventory, you’ll need a complete view of pricing and purchasing, as well as an idea of how to organize your warehouse more efficiently. Can you store your inventory more efficiently or utilize poorly organized space? Are there other factors that are slowing your inventory movement? An inventory management system can cut waste and raise profits through increased visibility and organization of your operation.
Excess processing waste
Excess processing refers to duplicate efforts. We’re not suggesting that you cut out any necessary or helpful steps, but there are plenty of ways to reassess your overall process to eliminate unnecessary and limiting roadblocks.
The solution
One way to identify time wasters is to invite an outside perspective. A Business Process Review by a qualified technology partner can give you a fresh perspective on your operations. Determine where workforce energy can be better applied and eliminate unnecessary steps in your workflow. Combine several processes into one step, and move your product through the pipeline with as few touchpoints as possible.
Ultimately, some waste is inevitable. But eliminating known inefficiencies and maximizing your ERP capabilities will significantly impact your day-to-day operations.
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