New Technology Falls Short of Promised Results

Client Challenge

A distribution center had recently converted to a new warehouse management system. But rather than improve efficiency and save money, the new software made processes less efficient and more costly.

Action Plan

The Dorsey Group worked with the company to develop a culture in which employees identify and prioritize issues, create area-crewing guidelines based on projected volumes and work standards, and drive employee accountability and ownership.

Results

• 18% reduction in full-time equivalent (FTE) requirements
• Increase in hourly pick rate from 34 to 41
• Increase in on-time delivery from 93% to 97%
• 140 hours of overtime eliminated per month

Economic Benefits

• 22% improvement in picks per hour
• $129,000 annual cost savings through headcount reduction
• $60,000 annual cost saving through overtime reduction