How can you have a satisfied warehouse workforce, and what does it take to retain them?
That was the focus of a research project conducted by Bryan Edwards, an Assistant Professor in the Department of Management at Oklahoma State University, together with Kevin Gue, an Associate Professor at the Department of Engineering at Auburn University, with funding from the Material Handling Industry of America (MHIA). I spoke to Bryan recently and he sent me an initial draft of their findings.
They conducted focus groups and surveyed 531 warehouse workers across six different distribution centers. The goal was to find statistically significant links between job satisfaction and job retention. Here are the factors that were statistically significant:
- Supervisors/managers provide frequent developmental feedback.
- Supervisors/managers provide opportunities for employees to voice opinions.
- The organization rewards good performance.
Bryan was quick to point out that these findings do not indicate causality. In other words, just because warehouses with managers that provide frequent developmental feedback have less turnover does not mean that giving frequent feedback increases retention. But that is just statistical gobbledygook. In statistics, proving one thing causes another thing is always very difficult.
Here is what struck me: If I was running a warehouse, I would care more about performance than turnover. In other words, if higher satisfaction led to lower performance, I’d live with the turnover. However, implementing discrete labor standards in an optimal manner improves performance while also relying on the behaviors listed above.
For example, back in July I wrote about how DSC Logistics implemented a Labor Management System (see “Labor Management at DSC Logistics”). Here are some excerpts from that article:
Reward good behavior: “Once the great majority of their staff was regularly achieving their daily goals, DSC put in place an incentive program. They pay ten cents an hour above the base pay for every percentage point above 100 percent in direct labor that a worker achieves. This made the program self funding – both workers and DSC profited from higher productivity.”
Supervisors provide frequent feedback: “Managers do daily coaching observations.”
Supervisors provide opportunities for employees to voice opinions: “In addition to making sure best practices are being followed (in the daily coaching sessions), part of their job is to keep their eyes open for barriers to worker productivity. Are there empty pallets in aisles? Do workers need to make extra key strokes to complete a task? At the end of the coaching session, the manager gets feedback from employees concerning the barriers they perceive and their ideas for making the job easier and more efficient.”
What was DSC’s experience? “DSC did lose some workers because of this program. However, they felt the workers that left were the ones with the worst attendance and safety records, and so they were left with a lean and efficient work force. Today, turnover is as low as it has ever been, and most of that they attribute to this program.”
And in relationship to the daily coaching and employee feedback: “[Jim Chamberlain, the Director of Engineering at DSC Logistics] believes this has helped improve employee and management relations, while the data from the LMS has been critical in creating a culture of accountability.”
In conclusion, it is possible to achieve high performance, a more satisfied workforce, and low turnover simultaneously.