Executive Briefings

Who Wants to Work in a Warehouse?

The holiday shopping season is upon us, and retailers are bulking up their supply chains to handle the expected surge in sales. Finding enough warehouse workers to fill the orders, however, could prove to be a tough challenge.

Who Wants to Work in a Warehouse?

Start with the fact that the national warehouse workforce is growing older. Many of its members are approaching retirement, and there aren't enough younger workers lining up to take their places, says Peter Schnorbach, senior director of product management with Manhattan Associates.

By its nature, warehouse work involves tasks that are numbingly repetitive. The productivity of employees is measured down to the minute. Working conditions can be brutal. So it’s not surprising that many young people “are frankly not interested in those jobs,” Schnorbach says. The high-school graduate who might previously have sought work in a distribution center today has a number of options, such as home healthcare and customer-service positions.

Those who do choose work within the walls of the warehouse aren’t especially happy about it. The latest Gallup survey of U.S. employment engagement revealed that transportation, distribution and production personnel ranked well below the national average in that sentiment, with only 23 to 25 percent of employees declaring themselves “engaged” in their jobs. What’s more, millennials were the least-engaged generation in the survey, at 28.9 percent. Together those numbers paint a portrait of aging, alienated workers and younger individuals who aren’t especially interested in performing one of the most vital tasks in the supply chain.

Clearly, warehouse employers need to find better ways of attracting and engaging workers. The most obvious step would be to pay them more, but most distribution operations are low-margin in nature, with wages reflecting the lack of higher education credentials among job candidates.

Some operations are launching incentive programs that reward the highest performers. But others continue to keep overall wages low, or depend heavily on temporary workers that are even less productive than their full-time counterparts. “Industry still seems to be throwing labor at the problem, as opposed to figuring out how to optimize that labor,” says Schnorbach.

One step that employers can take is to make sure that the full-time labor force is operating at peak efficiency. Workers need to understand the goals of management, which should provide both training opportunities and clear performance metrics. Only then should the employer be thinking about bringing in temps or pushing permanent staff for overtime.

Relentless measuring, of course, can be a big factor in employee disengagement, especially if workers feel they’re being treated like programmed robots. According to Schnorbach, though, they needn’t know they’re being measured. Or if they do, the information should be used to incentivize behavior, not browbeat workers for missing arbitrary performance targets.

“The most successful programs are the ones that are engaging the employees,” says Schnorbach. “Make them an important part of the overall mission of the operation.”

Then there’s the concept of gamification – applying the elements of gaming to the workplace in order to drive desired behavior. Examples include competitions based on posted results, with the awarding of prizes or other kinds of recognition as incentives.

Schnorbach cites the example of workers at the end of a shift writing down the number of units picked, as a challenge to the next shift. The ongoing competition could serve as a means of ramping up productivity.

At the same time, management gets valuable data on the efficiency of the operation. “I don’t think you can ever collect too much information,” says Schnorbach. “It’s what you do with the information that counts.”

The right kind of program will be driven by the workers, not management. Beyond any incentives that might be offered, workers get the benefit of knowing how they’re doing. “People are starved for feedback,” says Schnorbach. But the information in question shouldn’t be limited to the strict number of units picked, without taking into account individual workers’ abilities and the difficulty of various tasks.

The concept of gamification is still young. Schnorbach says Manhattan considered building a module into its warehouse-management application, but ultimately decided that “it was a little too early to do that.” Most of the company’s warehouse customers “are still at the point where they’re trying to figure out how to expose information to employees in the most meaningful manner.” Options include bulletin boards and flatscreen TVs, but most current tools don’t go beyond merely displaying the statistics.

The future might look something like the social performance platform originally known as Rypple, acquired by Salesforce.com, Inc. at the end of 2011. It morphed into a tool that provides real-time feedback on job performance, recognizes high achievers and aids in the recruitment of talent. “That’s a great concept,” says Schnorbach, “but I think it’s a little early for warehouses.”

In the end, the key to attracting and motivating warehouse workers will likely center on more traditional techniques: offering fair pay, varying work assignments, providing adequate training and getting buy-in from labor unions. Schnorbach says unions are open to performance measurements if they’re applied objectively and can serve as the arbiter in disputes.

The problem of attracting young people to an aging industry might be tougher to solve. The Gallup results suggest that employers need to focus on the issue of engagement. “Companies that want to hire these workers need to promote the cultural aspects of the job,” says Schnorbach. “They need to show how they’re going to provide value in these peoples’ lives.”

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Start with the fact that the national warehouse workforce is growing older. Many of its members are approaching retirement, and there aren't enough younger workers lining up to take their places, says Peter Schnorbach, senior director of product management with Manhattan Associates.

By its nature, warehouse work involves tasks that are numbingly repetitive. The productivity of employees is measured down to the minute. Working conditions can be brutal. So it’s not surprising that many young people “are frankly not interested in those jobs,” Schnorbach says. The high-school graduate who might previously have sought work in a distribution center today has a number of options, such as home healthcare and customer-service positions.

Those who do choose work within the walls of the warehouse aren’t especially happy about it. The latest Gallup survey of U.S. employment engagement revealed that transportation, distribution and production personnel ranked well below the national average in that sentiment, with only 23 to 25 percent of employees declaring themselves “engaged” in their jobs. What’s more, millennials were the least-engaged generation in the survey, at 28.9 percent. Together those numbers paint a portrait of aging, alienated workers and younger individuals who aren’t especially interested in performing one of the most vital tasks in the supply chain.

Clearly, warehouse employers need to find better ways of attracting and engaging workers. The most obvious step would be to pay them more, but most distribution operations are low-margin in nature, with wages reflecting the lack of higher education credentials among job candidates.

Some operations are launching incentive programs that reward the highest performers. But others continue to keep overall wages low, or depend heavily on temporary workers that are even less productive than their full-time counterparts. “Industry still seems to be throwing labor at the problem, as opposed to figuring out how to optimize that labor,” says Schnorbach.

One step that employers can take is to make sure that the full-time labor force is operating at peak efficiency. Workers need to understand the goals of management, which should provide both training opportunities and clear performance metrics. Only then should the employer be thinking about bringing in temps or pushing permanent staff for overtime.

Relentless measuring, of course, can be a big factor in employee disengagement, especially if workers feel they’re being treated like programmed robots. According to Schnorbach, though, they needn’t know they’re being measured. Or if they do, the information should be used to incentivize behavior, not browbeat workers for missing arbitrary performance targets.

“The most successful programs are the ones that are engaging the employees,” says Schnorbach. “Make them an important part of the overall mission of the operation.”

Then there’s the concept of gamification – applying the elements of gaming to the workplace in order to drive desired behavior. Examples include competitions based on posted results, with the awarding of prizes or other kinds of recognition as incentives.

Schnorbach cites the example of workers at the end of a shift writing down the number of units picked, as a challenge to the next shift. The ongoing competition could serve as a means of ramping up productivity.

At the same time, management gets valuable data on the efficiency of the operation. “I don’t think you can ever collect too much information,” says Schnorbach. “It’s what you do with the information that counts.”

The right kind of program will be driven by the workers, not management. Beyond any incentives that might be offered, workers get the benefit of knowing how they’re doing. “People are starved for feedback,” says Schnorbach. But the information in question shouldn’t be limited to the strict number of units picked, without taking into account individual workers’ abilities and the difficulty of various tasks.

The concept of gamification is still young. Schnorbach says Manhattan considered building a module into its warehouse-management application, but ultimately decided that “it was a little too early to do that.” Most of the company’s warehouse customers “are still at the point where they’re trying to figure out how to expose information to employees in the most meaningful manner.” Options include bulletin boards and flatscreen TVs, but most current tools don’t go beyond merely displaying the statistics.

The future might look something like the social performance platform originally known as Rypple, acquired by Salesforce.com, Inc. at the end of 2011. It morphed into a tool that provides real-time feedback on job performance, recognizes high achievers and aids in the recruitment of talent. “That’s a great concept,” says Schnorbach, “but I think it’s a little early for warehouses.”

In the end, the key to attracting and motivating warehouse workers will likely center on more traditional techniques: offering fair pay, varying work assignments, providing adequate training and getting buy-in from labor unions. Schnorbach says unions are open to performance measurements if they’re applied objectively and can serve as the arbiter in disputes.

The problem of attracting young people to an aging industry might be tougher to solve. The Gallup results suggest that employers need to focus on the issue of engagement. “Companies that want to hire these workers need to promote the cultural aspects of the job,” says Schnorbach. “They need to show how they’re going to provide value in these peoples’ lives.”

Comment on This Article

Who Wants to Work in a Warehouse?