Can a Warehouse Management System Really Help Managers Retain Employees in the Warehouse?
Published on 25 April 2023
Talk of labor shortages in the logistics and transportation industry is nothing new to warehouse managers who’ve been struggling to fill their roster for the better part of the last decade. And things are not looking up. According to the U.S. Bureau of Labor Statistics, there were 445,000 job openings in the transportation, warehousing, and utilities sector in December 2022 while hires were numbered at roughly 336,000. That’s a significant gap to say the least.
To make things worse, 319,000 workers left their job during that same period.
In other words, if attracting qualified employees in the warehouse has been making life difficult for managers, it turns out that retaining them is no piece of cake either.
There’s hope yet.
A high turnover rate isn’t a headache for just your HR department; it’s also having a detrimental impact on your bottom line. When employees come and go, it increases training costs and slows down operations, both of which ultimately melt your margins away. Retaining employees isn’t just a matter of having the workforce you need to maintain your throughput and meet your KPIs. It’s also about protecting your business’ profitability.
There’s a number of things warehouse and distribution center managers can do to improve their retention rate and enjoy the benefits of a stabler workforce. We’ll get to some of those in just a moment. First, let’s take a quick look at some of the reasons that explain why it can be so hard to retain qualified warehouse employees.
Why Do They Leave?
In a recent paper about labor shortages in the industry, we’ve outlined some of the reasons that explain why companies struggle to attract qualified warehouse workers. Unsurprisingly, the same reasons also explain why it proves so difficult to retain them.
Here are a few examples:
- Physically demanding work: It’s not uncommon for workers in a distribution center to have to walk 8 to 9 miles a day. Forklift operators are also at risk of physical strain. The U.S. Bureau of Labor Statistics reports 9,000 forklift related illnesses and injuries in the industry in 2017 alone.
- Repetitive tasks: There’s not a lot of creativity involved in a warehouse worker’s everyday tasks. After a while, the tediousness of repetitive work leads many to leave.
- Austere and stressful working environment: Warehouses are seldom seen as a “fun place”. Workplace aesthetics are normally trumped by the demands for efficiency. Meanwhile, the constant pressure to achieve a higher throughput paired with fewer workers on the floor makes for a stressful environment.
- Unappealing work schedules: This is especially true for operations that run 24hours a day.
All of this, however, has almost always been true, so why is it that employee retention has recently become that much more difficult to manage?
Well, it looks as though the new generation of workers isn’t willing to put up with warehouse working conditions the way that their predecessors did. And this is not mere perception fueled by some agist bias. The BLS data shows that the average tenure of individuals between the ages of 18 and 24 is somewhere around 1.1 years, well below the median in that industry (3.4 years in 2022).
With an aging workforce in warehouses across the U.S., if managers are going to solve their retention problems, the bulk of the solutions will have to come from paying attention to the needs and demands of the younger workforce. Surprisingly, it turns out that a Warehouse Management System (WMS) may very well be the key to doing just that. But, before we get to that, let’s take a look at other solutions companies should implement.
Solutions to Improve Employee Retention
There’s a number of measures companies can take to improve morale and augment their retention rate.
This one is a bit of a no brainer: if you pay your employees better than other companies in your industry, your chances of keeping them immediately go up.
But competitive hourly wages are just a part of it. The quality and extent of healthcare benefits, insurance, and retirement savings plan a company offers its employees are also key differentiators—especially in the U.S.
Training and skill upgrading
Rigorous training presents obvious advantages. It notably improves the safety of your employees and makes for a more efficient crew.
What is less obvious, however, is the impact good training might have on an employee’s perception of their own work. An employee is far more likely to remain who has the feeling of being good at what they do. A solid training program goes a long way towards cultivating that feeling.
A company’s training program should also enable skill development and upward mobility within the company.
Millennials seemingly get bored of their job faster than previous generations. By giving them the chance to develop their skills and take on new challenges within the company, you foster a sense of loyalty. Another advantage to internal mobility, as Caroline Vernon notes in her Forbes piece, is that it’s “not just a tactic to retain talent; it also serves as a way to create a powerful message about your employer brand for job seekers looking for that type of professional environment.”
Companies should promote a management culture that enhances the feeling in employees that their contribution is valued. This can be done in a number of ways: establish a strong feedback loop; focus more on your employees’ successes than on their failures; give good employees the chance to become “owners” by rewarding them with shares of the company; etc.
Another way to show that you value your employees’ well-being is to improve their working environment: invest in ergonomics; provide a well-stocked cafeteria and comfortable rest area; etc. Giving them better tools to perform their tasks—such as WMS enabled mobile devices, more on that in a minute—can also go a long way towards improving their perception of their work.
The potential for antisocial shifts and the fluctuating availability of hours caused by seasonality can lead employees to seek better conditions elsewhere. While the usual “3 x 8-hour shifts a day” might make it easier for managers to build their schedules, it can turn out to be detrimental to employee retention. Technology solutions exist that enable managers to implement more flexible scheduling (annualized hours, run a mix of shifts, etc.) more easily, thereby improving their employee’s working conditions.
Speaking of technology solutions in the workplace…
Turn Warehouse Work into a Game with a WMS
The measures outlined above are guaranteed to improve an employee’s working environment as well as their perception of their work’s value within the company, improving in equal measure their employer’s chances of retaining them longer. They will not, however, make the work itself more pleasant.
Cue in “warehouse gamification”.
At the outset of this paper, we’ve stressed how difficult it is to attract and retain the younger generation of warehouse workers who perceive warehouses as foreign and unpleasant. One way to offset that is to introduce in their working environment something they’re already willingly using all the time: technology.
Companies can, for example, implement a WMS on mobile devices very similar, if not identical to the mobile phones the younger workforce uses in their everyday lives. Thanks to intuitive and easy-to-use interfaces, a WMS like SOLOCHAIN makes the work feel more like a game—hence the concept of “gamification”.
When you think about it, many of the most popular games involve repetitive and somewhat meaningless tasks—just think of Candy Crush and the likes! Yet, many of us willingly engage with those and get a sense of fulfillment from completing levels and progressing in the game. WMS-enabled devices that exhibit displays reminiscent of such games contribute to making work more fun, if not rewarding.
Case in point: After having implemented the SOLOCHAIN WMS/MES, Cameron’s Coffee made significant gains in efficiency, which rapidly led to the company’s growth. By trading pen and paper for iPads and handheld devices in the warehouse, the company made it easier and more pleasant for employees to perform their tasks, which greatly improved morale and their retention rate. You can read more about how the SOLOCHAIN WMS benefitted Cameron’s Coffee here.
Paired with other solutions stated above, warehouse gamification by means of WMS enabled mobile devices is a real game changer—no pun intended—for warehouse and DC managers.
About Generix Group
Generix Group North America provides a series of solutions within our Supply Chain Hub product suite to create efficiencies across an entire supply chain. Our solutions are in use around the world and our experience is second-to-none. We invite you to contact us to learn more.
Download our Guide to the Warehouse of the Future