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Jason Stark

7 Warning Signs Your Logistics Processes Are Outdated

by Jason Stark
Man in a warehouse counting packages

Just as in any other industry, logistics processes are changing rapidly. If you're not careful, you could find yourself lagging behind your competitors in the blink of an eye. The best thing you can do is understand some warning signs and set up systems and processes to catch them before it significantly impacts your business.

1. You keep having to find "workarounds."

This is high on the list of one of the most overlooked aspects of a broken and outdated system. People seem to get into a flow and accept that something works for them and fall into the "If it ain't broke, don't fix it" mentality. But unfortunately, that doesn't work from a business standpoint.

As any logistics business owner or manager can tell you, seconds count. So an inefficient process that costs you a few seconds each time may not seem like much. But what if that process is repeated 100 times a day? And what if 20 employees do that same process? That's an hour and 40 minutes wasted every day. Or better yet, over 400 hours a year. With costs of $15 an hour, that's over $6,000 a year.

Now imagine you have four or five processes like that where you find little workarounds. It adds up very quickly. So every process should always be looked at through that long-term lens and changed as soon as possible.

Woman packing clothes

2. You constantly find things coming down to the wire, or even worse, you're missing deadlines

In a logistics environment, you can't help it. You're going to have situations outside of your control that make it so that it comes down to the wire. However, if you keep finding yourself in that situation, it might be time to investigate further. Several factors can cause issues – poor time management, communication, misunderstanding of the assignment, and more.

In these situations, smart operations people perform thorough documenting. Of course, you don't need to document every little thing, but if something didn't go as planned, it’s worth keeping a note on it in a central place. After a while, you may start to notice trends and patterns. If that's the case, you know you need to address the issue and make a change.

3. You haven't done a review of your logistics processes in the last 6-12 months

Every business I know does periodic reviews. Most companies, though, don't regularly review processes. Especially logistics processes. Many businesses just review the people who oversee any department and then assign praise or blame. Doing a proper and scheduled inspection of your operations is as important as doing personnel reviews.

Often, we tend to look at the results of KPIs and assign them to the manager's impact. However, many managers and supervisors are merely working within the given system. Therefore, it is crucial to review your processes, so you know that your managers, supervisors, and employees, all have the proper support they need and be judged on an even playing field.

People working together in a warehouse

4. You did a review but haven't implemented any of the proposed changes

So I can hear you now, "Jason, we've done our reviews and found so many ways to save our company time and money!” That's amazing! Now, how many have you implemented? I understand that change can be challenging to implement, significantly the larger your company gets. But if you find yourself in that situation where you've done your due diligence and still nothing has changed, that's the first process that should be looked at.

Every review should list proposed changes that could improve your operations. Typically, I find highly successful organizations assign a value based on how immediate the changes should be implemented, and then they quickly implement the most crucial ones. Being adaptable is one of the most critical characteristics of a successful logistics operation.

5. You have to issue more and more refunds, credits, and concessions

When I have done consulting in the past, one of the first things I ask to see is a list of refunds, credits, and concessions and why they were issued. There is no quicker way of getting to the heart of any suspected logistics operations failings than that. Every business is going to have unsatisfied customers. Every business will have to issue returns and credits for one reason or another. But when you see patterns, that should cause the alarms to start going off.

Patterns in your logistics process should terrify you. There is no quicker way to lose your shirt than inefficient logistics processes. If you see something that continually costs you money, identify it and fix it – immediately.

6. Your customers are complaining about your processes

Customers complain. That's true of any business. If your customers keep complaining about the same issues, that should cause some concern. As mentioned above, you should have regular reviews of your processes. However, that doesn't mean you should wait until the next time one is scheduled to do one.

Having an ad hoc review process can be immensely helpful for catching issues before they become full-blown emergencies. For example, if you keep hearing your customers tell you that they have a problem with one or more of your processes, it would be an excellent time to initiate a review.

7. Your staff is telling you that your processes are outdated

This is, without a doubt, the number one most overlooked warning sign. Unfortunately, some employers don't listen to their employees. The reality is that they are on the ground dealing with these processes and issues every day. They might not always have the answer for you, but they can certainly tell you when something is wrong.

I know it's not always fun to hear complaints, but if the complaints are about the same thing repeatedly, it might be worth taking a look at. I find it helpful to have a system to allow employees to openly report issues they see without reprisal. After that, have a strategy to catalog what processes are brought up most frequently.