Inside you’ll find: cost-cutting strategies for your fulfillment operations; how to protect your inventory from internal theft; how to assess your catalog systems options; and how to determine your optimal IT spend.
Successful cost-cutting strategies for your catalog fulfillment operations.
By William J. Spaide
Lackluster operating performance in your catalog’s fulfillment operations can result from a combination of factors: poor productivity, inefficient processes, and unanticipated marketing and merchandise results. Failure to identify early warning signs of trouble and, more importantly, not addressing these problems decisively and effectively, are common characteristics of the operational “also-rans.” It all comes down to a question of focus, process and performance.
To be effective, fulfillment managers must maintain a laser-like concentration on the key performance indicators of their departments. They follow a simple dictum: Less is more, and sooner is better than later.
Typically, savvy managers generate a dashboard of key indicators every morning, with weekly and monthly summaries. They can differentiate and distill actionable data from the continuous flow of information crossing their desks. The specific metrics depend on the activities being measured, but in general, I’m talking about workload and staffing projections in relation to actual results, labor costs per transaction, transactions per hour, and operating cost as a percentage of net sales.
Managing by the numbers alone, however, may not give you adequate warning of poor performance. Line managers often become adept at manipulating numbers, with operating costs ending up a question of who’s counting what. Also, avoid making “last year’s results this year’s standards” a practice. It dampens both future cost-reduction initiatives and ongoing performance.
Managers in the best-run operations know things can always get better. They believe if it isn’t broken, it’s still broken. For them, process improvement isn’t an initiative; it’s a mind-set.