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SIMSA Audit Software

About

SIMSA is an integrated Audit Management Platform based on the PDCA (Plan-Do-Check-Act) framework of operational excellence. It cuts out the bureaucratic layers of reviewers & approvers, therefore quick to deploy and intuitive to use. Its simplicity and mobility feature is the key factor for the buy-in from the operational staff. It can be used for self-assessments and tracking of corrective actions.

Author: Ashish Mendiratta

Audits post pandemic

Re-imagining Operational Audits in Post Pandemic World

The COVID-19 pandemic has had a profound impact on businesses worldwide, disrupting supply chains, altering consumer behavior, and challenging traditional ways of working. As organizations adapt to the “new normal,” operational audits have become more critical than ever. In this blog, we will explore the role of operational audits in a post-pandemic world and how they can help businesses navigate this challenging environment.

Operational audits are a systematic and objective assessment of an organization’s operations, processes, and controls. They are designed to evaluate the effectiveness of the organization’s risk management strategies, identify areas of inefficiency, and provide recommendations for improvement. Operational audits can cover a wide range of areas, including financial operations, IT systems, supply chain management, and health and safety practices.

The pandemic has created significant disruptions across all industries, forcing businesses to adapt to rapidly changing conditions and new ways of working. These disruptions have also impacted the way operational audits are conducted, with many businesses facing new challenges in the audit process.

One of the biggest challenges faced by businesses is the need to conduct audits remotely. With many employees working from home, auditors have had to rely on digital communication tools to conduct interviews and gather information. This has created new challenges around data security and privacy, as well as communication and collaboration between auditors and auditees.

Another challenge faced by businesses is the need to assess new risks and vulnerabilities created by the pandemic. For example, businesses may need to evaluate the risks associated with remote work, such as data security and employee productivity. Additionally, the pandemic has created new risks around supply chain disruption, employee health and safety, and compliance with government regulations.

Despite these challenges, operational audits remain a critical component of effective risk management in the post-pandemic world. By leveraging the right tools and strategies, businesses can conduct audits effectively and efficiently, identify and mitigate new risks, and improve overall operational efficiency.

Operational Audits are more important than ever

In a post-pandemic world, operational audits have become essential for several reasons. Firstly, the pandemic has led to significant changes in business operations, with many companies adopting remote work arrangements, altering supply chain strategies, and implementing new safety protocols. Operational audits can help organizations assess the effectiveness of these changes and identify any new risks that have emerged.

Secondly, the pandemic has created new risks and challenges for businesses. Supply chain disruptions, cybersecurity threats, and employee health and safety concerns are just a few examples of the new risks that organizations are facing. Operational audits can help businesses identify these risks and develop strategies to mitigate them.

Finally, the pandemic has heightened the need for transparency and accountability. With stakeholders, including employees, customers, investors, and regulators, demanding more information about how organizations are managing risk, operational audits can help provide assurance that proper controls and processes are in place.

Role of Technology in Operational Audits post-pandemic

Technology plays a crucial role in operational audits, especially in a post-pandemic world. With remote work arrangements becoming more prevalent and businesses increasingly reliant on digital systems and processes, technology has become an essential tool for operational auditors. Here are a few ways in which technology can support operational audits in a post-pandemic world:

1. Remote Auditing: Technology can enable auditors to conduct remote audits, reducing the need for in-person interactions and allowing audits to be conducted safely and efficiently. Remote auditing tools can include video conferencing, screen sharing, and remote access to systems and data.

2. Data Analytics: Technology can help auditors analyze large volumes of data quickly and accurately, identifying patterns and anomalies that may indicate areas of risk or inefficiency. Data analytics tools can include data visualization software, artificial intelligence, and machine learning algorithms.

3. Automation: Technology can automate many of the tasks associated with operational audits, freeing up auditors to focus on higher-value activities. Automation tools can include robotic process automation, workflow management software, and electronic document management systems.

4. Collaboration: Technology can enable auditors to collaborate more effectively, even when working remotely. Collaboration tools can include cloud-based project management software, virtual whiteboards, and chat applications.

5. Security: Technology can help auditors ensure the security of their audit data and protect against cyber threats. Security tools can include encryption software, multi-factor authentication, and network monitoring tools.

In addition to these specific tools and technologies, the use of technology can also help auditors to work more efficiently, reduce costs, and increase the speed and accuracy of audits. For example, technology can automate many of the routine tasks associated with audits, such as collecting data and generating reports, allowing auditors to focus on more strategic and analytical activities.

Audit Software

In conclusion, operational audits are more critical than ever in a post-pandemic world. They can help businesses navigate the challenges and risks posed by the pandemic, evaluate the effectiveness of new operational strategies, and ensure ongoing compliance with relevant regulations and standards. By providing transparency and accountability, operational audits can also help businesses build trust with stakeholders and maintain their reputation in a challenging environment.

The Operational Excellence Compass

In a recent webinar on Reimagining Operational Excellence in a VUCA world, there were panelists across different industries. Everybody agreed that the business leaders are losing interest in OE initiatives. Despite so much time & effort being spent on lean, six sigma and many blackbelt projects, they don’t see a real impact on the business outcome. It was felt that OE needs a new Avtar in the world that is changing at a very fast pace.

Many companies bet upon their continuous improvement program and often brand it as operational excellence. However, there is a vast difference between the two in many aspects. The goal of continuous improvement is to eliminate wastes, cut cost, reduce lead times etc. The most common techniques used for the continuous improvement are Kaizen, Lean, Six Sigma. Continuous improvements are based on small changes rather than paradigm shift or breakthroughs. Operational Excellence, on the other hand, is focused on delivering the performance to make an organization or business better than the competition. Operational excellence starts with leadership setting the strategic direction, which percolates through every process and decision making.

Standalone, Continuous Improvement initiatives do not Sustain

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The continuous improvement follows a continuous cycle of Improve, Sustain, Measure & Monitor. The gains realized at the beginning of implementing a continuous improvement program are significant. But over a period of time, the law of diminishing return sets in and the spiral of improvement become smaller and smaller.

After a few years, the continuous improvement program becomes a ritual, focus shifts to the quantity of projects than the quality, and little impact on the company’s top line and bottom line. It has also been found that the continuous improvement projects keep running in isolation, essentially being driven by a group of employees in their specific area and mostly focused on manufacturing operations.

The idea is not to belittle the importance of continuous improvement but without an umbrella of operational excellence, it may lose direction & significance.

Operational Excellence is an Organizational Compass

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Operational Excellence is much more than the improvement program. The term Excellence means superiority or better than others. When applied in the business sense, excellence means delivering value to your customers superior to your competitors. It involves setting the organization up for growth by understanding what the market wants and creating an uninterrupted value stream aligned to the customer needs.

Considering the fact that we live in an increasingly dynamic world, the customers, markets and business models change frequently. Operational excellence acts like a compass, always pointing and aligning to the customers’ needs, provides a new strategic direction to the entire organization.

When ingrained into the organization culture, it works in auto mode and continuously aligns the internal journeys to the customer journeys. It provides the agility in decision making, execution as well as resilience by minimizing the time to recover in case of any shocks.

How does the Operational Excellence Compass work?

It begins with understanding what the company would want to excel at to gain competitive advantage or the customer value proposition. Is the value proposition the low price, high speed of response, flexibility or variety offered, superior customer service or anything else?

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It is also a fact, that you cannot excel in every performance parameter. Therefore, all energies should be focused delivering a superior performance than your competitors on the parameters that are critical for the value proposition.

For example, for McDonald the value proposition is quick delivery. Therefore, for them the operational excellence means standardising the processes, making the operations agile to minimize customer waiting time. But if you are looking for variety of options or flexibility, then MacDonald is not the place to go.

Another example is Starbucks whose value proposition is superior quality products and comfortable ambience. For them the operational excellence means sourcing finest beans, retail outlet design, making the customers feel at home. If you are looking for a cheap coffee, then Starbucks is not the right place to go to.

Using Operational Excellence Compass

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 1. Find True North:

Finding true north means identifying the Customer Value Proposition or what do you offer to the customers that will put your business in the leadership position. It could be superior quality, large variety, fastest delivery, or lowest prices etc.

 The challenge is that the true north is not stationary in a dynamic environment. For example, restaurants that offered dine-in had to shift to home delivery during Covid. Similarly, online grocery delivery companies are offering 10 minutes delivery. As the competition heats up, the true north may need to shift.

 It is the responsibility of the leadership to continuously watch, question, redefine & communicate the customer value proposition to stay ahead of competitors.

 2.    Plan Customer Wow Experiences:

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 Customer wow experience or customer delight means exceeding (not just meeting) customers’ expectations. For example, if the value proposition of a grocery delivery company is the speed, then delivery within 10 min is a customer wow experience. Similarly providing a salon experience with all safety measures at home is a wow experience provided by Urban Company.

3. Align Customer Journeys:

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 Customer journeys are the processes that create customer experiences which include how a customer enquires about the company’s products, how they place the orders, what communication they receive, and how the products are delivered etc.

 Amazon is one of the best examples of the excellence in the customer journey. Not only customer is able to search variety of products, but they can find technical details, reviews of buyers, alternative products, find many options for making payments, get rewards but also return the products if they are not satisfied.

 The customer journeys must be aligned to create the customer wow experiences. Many companies set-up customer experience centres so that they can experience the products before making a decision to buy.

4. Align Internal Journeys:

 The internal journeys are the internal operations and processes e.g., customer order to cash, supply chain, manufacturing and procure to pay processes. Getting an alignment and coordination between these processes is one of the most challenging tasks.

 This is because how different functions are incentivized and may end up having conflicting true north. For example, while supply chain department may be incentivised on the service, manufacturing may be incentivized on lowest cost. That is why using the right true north (value proposition) for the cross-functional alignment is very important.

 The role of the operational excellence is to facilitate the internal alignment of the objectives, targets to the customer journey. For example, to create the experience of 10-minute delivery the logistics must ensure the network that can cater to this requirement.

 5.  Implement Cultural Enablers

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 Unless the excellence is embedded into the DNA of the organization, the operational excellence initiatives are not sustainable. Every employee needs to understand how their role fits in, see its impact and feel empowered to contribute towards creating customer wow experiences.

 Sensitizing the employees to customers’ needs, communicating the customer value proposition, training & skilling them, equipping with right tools, encouraging the cross-functional collaboration, creating transparent and visual systems for every employee to see the impact, are some to the measures for the cultural enablement.

 6.  Continuously Improve:

Once there is an understanding on the quantitative and qualitative aspects of the internal journeys, the continuous improvement programs should focus on those areas where there are significant gaps from the targets or expected outcomes.

 Sometimes, automation or complete transformation may be required before implementing the continuous improvement. Periodically conducting operational audits, checking if the improvements are sustained, ensuring corrective actions where gaps are found is an important piece of continuous program, which mostly is neglected.  The reason is use of spreadsheets based systems and manual workload involved in managing the entire workflow. Using technology e.g. SIMSA, for automation of workflow and use of advanced analytics to predict risks helps to ensure that the improvements stay on the right course.

7.    Re-assess True North & Realign

 As mentioned earlier, in an increasingly dynamic environment, the true north keeps shifting. Therefore, periodically re-assessing the true north and realigning the customer & internal journeys ensures that you continue to win in the game of competition.

Conclusion

Operational Excellence has been reinvented to overcome the challenges posed by the dynamic world. Its role has evolved from providing the tactical advantage to providing strategic competitive advantage.

The operational excellence compass automatically points to the shifting true north or the customer value proposition and realigns the customer & internal journeys. It ensures that the organization never lose the sight of the right direction and continuously win in the marketplace.

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Need & Benefits of Operational Audit Software

Operational audit software is a powerful tool that can help organizations improve their operations and ensure compliance with regulations. It allows companies to automate their audit processes and streamline their operations, which can save time and money while also improving the overall quality of their audits and ensuring timely closure of the gaps found.

Operational audit software can automate time consuming manual tasks such as data collection, data analysis, report generation, tracking and reporting corrective actions etc. By automating these tasks, organizations can reduce the time and resources required to complete an audit which can be especially beneficial for companies with complex operations or those that conduct multiple audits each year. Additionally, these software programs can also help organizations identify areas of improvement in their operations, which can be addressed as part of the audit process.

Another benefit of operational audit software is that it can help organizations ensure compliance with regulations. Many of these software programs include built-in compliance checks, which can help organizations ensure that they are meeting all of the requirements set out by regulatory bodies. Additionally, these software programs can also help organizations track their compliance efforts over time, which can be useful for reporting purposes. This can be especially beneficial for companies that operate in highly regulated industries, such as healthcare or finance, as compliance is of paramount importance to these organizations.

Operational audit software can also be used to improve the overall quality of audits. Many of these software programs include advanced analytics and reporting capabilities, which can help organizations identify patterns and trends in their operations. Additionally, these software programs can also be used to create detailed, actionable reports that can be shared with stakeholders, including management and regulatory bodies.

Operational audit software can also be used for real-time monitoring and control of operations, which can help organizations to quickly identify and address issues as they arise. This can be especially beneficial for companies that operate in industries such as logistics pharma, chemicals, healthcare, where the ability to identify and address issues quickly can have a significant impact on the bottom line. Additionally, many of these software programs also offer the ability to automate corrective actions, which can help organizations to address issues more quickly and efficiently.

Operational audit software also allows organizations to store and organize data in a centralized location. This can include information on audit findings, compliance data, and other relevant information. This can make it easier for organizations to access and analyze data, and can also help to ensure that data is accurate and up-to-date. Additionally, this data can be easily shared with stakeholders, such as management or regulatory bodies, as needed.

SIMSA is one of the best operational audit softwares with unique features e.g:

  1. Scheduling Recurring Audits at any frequency in one shot e.g. daily, weekly, monthly, quarterly
  2. Gamification of audit performance scores by awarding Diamond, Gold, Silver, Bronze ratings to the sites
  3. Conducting surprise audits
  4. Providing the standards & guidelines for assessment to the auditors on the go
  5. Off-line mode for conducting audits on mobile in case of poor or no data connectivity.

SIMSA can save up to 70% of time as compared to using spreadsheets or any other manual systems. It allows people to focus on the value added part of audits as all non-value added activities are taken over by the software.

In conclusion, operational audit software is an essential tool for organizations looking to improve their operations and ensure compliance with regulations. These software programs allow companies to automate their audit processes and streamline their operations, which can save time and money while also improving the overall quality of their audits. Additionally, these software programs can also help organizations ensure compliance with regulations, improve the overall quality of their audits, and monitor and control operations in real-time. By adopting operational audit software, organizations can improve their operations, ensure compliance with regulations, and reduce costs, which can have a significant impact on their bottom line.

10 Must Have Features for Operational Audit Software

Operational Audit Software is increasingly used by companies that have significant risk exposure to the operational failures. The purpose of the software is to standardize & streamline the audit process and at the same time save people time in managing end-to end audit workflow by automating the manual activities. There are many solutions available in the market, but if you ask the users, they will have a long list of expected features. However, the top 10 features, required by most of the users are:

1️⃣ 𝙎𝙘𝙝𝙚𝙙𝙪𝙡𝙞𝙣𝙜 𝙍𝙚𝙘𝙪𝙧𝙧𝙞𝙣𝙜 𝘼𝙪𝙙𝙞𝙩𝙨: Operational audits should be done at a regular frequency or cycle. What if you can schedule recurring audit at any frequency required e.g. daily, weekly, monthly etc., like scheduling recurring meetings in calendar?

2️⃣ 𝘼𝙡𝙡𝙤𝙬𝙨 𝙗𝙧𝙚𝙖𝙠𝙞𝙣𝙜 𝙩𝙝𝙚 𝙨𝙞𝙩𝙚 𝙞𝙣𝙩𝙤 𝘼𝙧𝙚𝙖𝙨: A site has multiple areas e.g. a warehouse site may have security, parking, utility, docks, storage, packing, office areas. Shouldn’t the checkpoints be specific to each area? Does your audit software allow that and ensure no area is missed out by the auditor?

3️⃣ 𝙎𝙚𝙦𝙪𝙚𝙣𝙘𝙞𝙣𝙜 𝙩𝙝𝙚 𝘼𝙧𝙚𝙖𝙨 𝙞𝙣 𝙖 𝙇𝙤𝙜𝙞𝙘𝙖𝙡 𝙊𝙧𝙙𝙚𝙧: Imagine the auditor moving back & forth in different areas as the check points may be listed randomly. With sequencing of areas, the check points will be presented to the auditors in a logical order, saving time and avoiding any confusion.

4️⃣ 𝘾𝙤𝙣𝙩𝙧𝙤𝙡 𝙤𝙣 𝘾𝙝𝙚𝙘𝙠𝙡𝙞𝙨𝙩 & 𝙫𝙚𝙧𝙨𝙞𝙤𝙣𝙨: If you follow any QMS, you will know the importance of standardization and control of documents. Does your audit software ensure that all are using the latest version of the checklist and standards?

5️⃣ 𝘾𝙤𝙣𝙙𝙪𝙘𝙩𝙞𝙣𝙜 𝘼𝙪𝙙𝙞𝙩 𝙞𝙣 𝙈𝙤𝙗𝙞𝙡𝙚, 𝙚𝙫𝙚𝙣 𝙞𝙣 𝙊𝙛𝙛𝙡𝙞𝙣𝙚 𝙈𝙤𝙙𝙚: Many sites like warehouses, depots, fulfillment centers are located in remote areas with poor data connectivity. Also, in the cold room there may not be good data connectivity. If you don’t have an offline mode, you cannot use mobile device to conduct audits. Does your audit software work even without data or wi-fi connectivity?

6️⃣ 𝘼𝙘𝙘𝙚𝙨𝙨 𝙩𝙤 𝙎𝙩𝙖𝙣𝙙𝙖𝙧𝙙𝙨 𝙤𝙣 𝙩𝙝𝙚 𝙜𝙤 𝙬𝙝𝙞𝙡𝙚 𝘾𝙤𝙣𝙙𝙪𝙘𝙩𝙞𝙣𝙜 𝘼𝙪𝙙𝙞𝙩: What if auditors can access the relevant standard for each check point as they are conducting the audit, without going thru the pain of checking soft or hard copies?

7️⃣ 𝘼𝙪𝙩𝙤𝙢𝙖𝙩𝙚𝙙 𝙍𝙚𝙥𝙤𝙧𝙩𝙞𝙣𝙜: In the age of social media, people don’t want to read manually written long reports. Does your software provide automated report that includes all details but yet to the point?

8️⃣ 𝙎𝙡𝙞𝙘𝙞𝙣𝙜 & 𝘿𝙞𝙘𝙞𝙣𝙜 𝙤𝙛 𝙋𝙚𝙧𝙛𝙤𝙧𝙢𝙖𝙣𝙘𝙚: Does your software allow you the slice & dice the performance by Areas, Categories, Sub-Categories, Risks or a combination of that, so that you know where the problem is?

9️⃣ 𝘼𝙨𝙨𝙞𝙜𝙣𝙢𝙚𝙣𝙩 & 𝙏𝙧𝙖𝙘𝙠𝙞𝙣𝙜 𝙤𝙛 𝘾𝙤𝙧𝙧𝙚𝙘𝙩𝙞𝙫𝙚 𝘼𝙘𝙩𝙞𝙤𝙣𝙨: What is the point of conducting audit if it doesn’t lead to timely corrective actions? Does your software allow assigning actions with timeline and then track, sends auto reminders for follow-ups?

🔟 𝙂𝙖𝙢𝙞𝙛𝙞𝙘𝙖𝙩𝙞𝙤𝙣: What if your audit software gives coins or badges based on the scores & actions taken? Wouldn’t that motivate people to go for higher standards & ratings?

SIMSA Operational Audit Software is the only platform that has all the above features. SIMSA can help you save up to 70% of the time in managing the entire workflow. Then why settle for less?Audit Software

 

Warehouse Picking

7 Tips for Improving Picking Productivity in Warehouse

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Importance of Picking Process

Picking is a process of retrieving goods from their storage locations to fulfill customer orders. This is one process in the warehouse that has significant impact on the warehouse performance, namely, warehouse productivity and customer service.

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The typical operational cost break-up of warehouse cost shows more than 50% cost is spent on the picking process. Even today in most of the warehouses, picking process is manual and dependent on the skills and experience of the operators. The picking cost has been increasing due to SKU proliferation, smaller order quantity by the customers, especially with the growth of eCommerce channel.

Apart from the cost picking is also responsible for the errors in wrong products shipped, inventory inaccuracy, product damages, shipment delays etc. that may have serious implications for customer service.

Pain Points of Picking Process
1. Optimize the Warehouse Layout & Slotting

Warehouse layout and slotting of product have significant impact on the picking efficiency & accuracy. If the layout is optimized so that most frequently ordered products are slotted closer to the docks, the travel time of the pickers is minimized. The pickers can pick more orders in the same time leading to significant improvement in the productivity.

Warehouse Layout

Also, if the inventory is organized according to the SKU codes & batches, the chances of errors by the pickers are minimized. It also reduces the search time of the picker thereby improving the productivity.

However, the business dynamics may change so rapidly that can make the layouts & picking process sub-optimized. Most warehouse managers are so occupied with day to day operations that they may not spend enough time to review the layout periodically.

2. Apply Right Picking Strategy
Warehouse Picking Strategies

Picking strategies can vary depending on the customer orders profile and the warehouse layout. There are 4 picking strategies: Discrete, Batch, Zone and Wave picking.

The right picking strategy optimizes the time taken to pick each order and the travel time of the picker. Inappropriate picking strategy may lead to fewer orders picked by each operator, leading to lower productivity and delays in shipments.

 

3. Use Appropriate Technology & Automation

The objective of using technology for the picking process is to reduce picking time and improve picking accuracy. The appropriate technology depends on the the volume and complexity of the picking activity.

Barcode scanning along with Warehouse Management System is the one of the most commonly used technology.  The other technologies are pick to light system, sorters & conveyors, robots etc. Each technology has its pros and cons, therefore, it is important to select the right combination of technologies that addresses the picking complexity for a warehouse.

 

Warehouse Barcode Scanning
Operational Audit Software
4. Plan & Schedule Order Picking

Planning plays a very important role in the picking process to ensure optimal utilization of resources. In most cases, picking is triggered as & when new picklists are generated. It leads to under occupation of resources during certain times and over occupation in the other times.

By planning the picking activity in advance based on the planned shipments would help in levelling the resource requirement leading to minimal idling as well as overtime. Some of the planning techniques that can achieve this objective are:

  • Combining high resource intensive picks with low resource intensive picks
  • Sequencing the picks based on the shipment loads
  •  Prioritization of picks based on the order priority - orders with lower priorities can be picked next day
  •  Creating picking teams based on zones or docks and ensuring coordination with the staging and shipping teams
5. Use Visual Management Techniques
Warehouse LED DIsplay

Whatever is visual and eye catching, gets more attention of the human beings. Since the picking activity has a huge involvement of people, visual  management is very effective in ensuring discipline and adherence to the process.

Some of the ideas for Visual Management for picking are:

  • Display location codes / numbers of the storage location prominently. It will minimize the search time of the pickers & improve productivity.
  • Segregate and place signboards on the products that are not supposed to be picked e.g. quality hold, expired, damaged or red tag zone. It will minimize the errors & improve the accuracy.
  •  Use LED Boards to display the picking target for the day, picks completed and picks balance. It is a great motivator for completing the target for the picking operation.
6. Periodically Audit Picking Process

Warehouses are under constant pressure for timely delivery of products. As a result, many shortcuts are taken and exceptions become the rule. If such deviations and bad practices are not identified and addressed timely, it may lead to major incidents or failures.

Periodic warehouse audits ensures that gaps & risks in the operations are addressed in a structured manner. SIMSA Audit and Improvement tool enables digitization of audit schedules, reporting as well as tracking corrective actions leading to operational improvements. SIMSA can save up to 70% of the time in managing the warehouse audits as compared to using spreadsheets. Also, it provides full visibility to all stakeholders on various gaps and actions taken.

Download the free editable Warehouse Picking Process checklist here.

 

SIMSA Audit Mobile
7. Measure, Monitor and Improve Picking Performance

What you don't measure, you cannot Control. And what you don't Control, you cannot Improve.

It goes without saying that measurement of the performance picking process helps to understand its impact on overall efficiency & cost. It may also point to certain changes that may be required either in the warehouse layout, reorganization of SKUs, resource allocation, automation or even training the operators.

The common performance indicators for the picking process are:

  • Pick to Ship Time
  • Backorder Rate
  • Picking accuracy (Perfect Order Fulfillment)
  • Units picked per resource (Productivity)

Analyzing the performance indicators, performing the root cause analysis and following PDCA cycle enables continuous improvement in the picking process.

SIMSA Operational Audits