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How ShipHero Meets SLAs & CPPs | Warehouse OS Series Ep 06

Experience the world-class operations of the ShipHero Las Vegas facility as Ryan Mulroy, our General Manager, takes you on a journey through all that this warehouse offers.

See firsthand his commitment to efficient picking and packing (50+ UPH) and effective implementation of SLAs and CPPs.

Discover the wonders of our state-of-the-art warehouse operation systems and learn how they can help streamline your own warehouse operations. Tune in now for a behind-the-scenes look at ShipHero’s Las Vegas warehouse!

Video Transcript
Everything in a warehouse should have a flow. It comes into the building. It comes out of the building. Right now, our pickers start at that end of the building, and they finish all the way at the far end. They put their carts completed over in this area. All right. I'm here today with Ryan, the GM of our Las Vegas facility. It's a 200,000 square foot facility that we operate and serve about a couple dozen clients. Just want to thank you for the time. How long have you been running this facility? As of right now, about eight months. Pretty short time, pretty big building. What have you learned over the last eight months? Learned a lot specifically about fulfilling small parcel packages. Previous companies have been rental industry and furniture, large format packages, so definitely learning a lot in terms of how to most efficiently ship out the small parcel, where we can improve upon and what sizes matter the most for our customers. You're the GM of the building. Yes. What does that mean? What do you do all day? For me, that means I'm responsible for everything that is within the four walls. Any associate that touches a box or misplaces a product, my job is to make sure that we have processes in place, and that if we have processes in place, they're being followed, so that we can efficiently get our inventory in, out on time. What are the metrics that ... Every day you're working towards a goal, right? What are those metrics? What are those goals? Yeah. The main metrics and goals is making sure that we are picking and packing efficiently. Our standard is pack 50 an hour, pick 50 an hour. So making sure that the associates are meeting those standards, as well as ensuring that they're set up for success. That's the biggest thing, because I'm not going to hold them accountable for not hitting their numbers if I'm not doing everything in my power to make sure that they are going to hit that. Whether that's better organization on the floor, more stuff replen-ed, and at the end, just making sure all the orders are getting out at the end of the day and in a timely manner. We've got some stuff that's expedited that we have to get out by a certain time. I'm very big on getting that stuff done. What I always hear, the acronyms are SLA and CPP. Tell me what those two are and why they matter. SLA, the service level agreement, that's the agreement between us and our customers. Every SLA is a little bit different, per customer. We may have a certain percentage that we have to hit to ensure that that amount of packages are leaving for the day. I always strive to do a little bit better than that. But it can be different from every single customer. It's not like a one size fits all when it comes to an SLA. You get a customer with big giant boxes that need to ship out, maybe they take a little bit longer in order to get out. In terms of CPP, the cost per package, that's the main metric we try to focus on. You can put 20 people in a building when you have the work for 10. That's going to reflect poorly on your CPP. It's a really good metric for me, myself, to be able to measure how efficiently we are operating, and making sure that everybody's hitting their targets of pick or pack 50 or more. Basically, we make money if we're consistently hitting our SLA while minimizing our CPP. That's basically the business model of this facility. Yes. When you come in the morning and when you leave at night ... What's the first thing you look when you get here in the morning, and what's the thing you look at before you leave at night that makes you know, okay, my job here is done, and I can leave? First thing in the morning, I literally wake up and roll out of bed. First thing I do is I just check the report to see how many orders we have, on the homepage right there. I can just quickly and easily see, okay, normal order volume, accelerated order volume. That just lets me know that, when I come in, I'm either going to have to reshuffle employees to better take care, or if we're slow, I'll give Tomasi a little ping and say, "Hey. I'm going to be sending some people your way first thing in the morning to do cycle counts." Right. Tomasi's our inbound manager. Yes. Right? What basically I'm hearing is if we have more people scheduled to work for the day than what you anticipate you'll need to fill all those orders, we shift some of those people to Tomasi's team so that Tomasi can use them to count some locations that maybe haven't been counted in a while. Is that accurate? Correct. Yep. Big on cross training in this facility, so a lot of people know how to do multiple types of jobs. There's times where we just have a rush, and we want to get the orders done. As we break off and finish, and complete a large chunk of orders, we may have them go assist with offloading a truck so we can get that done sooner. Does WorkforceHero help you manage who's doing what? Yes. WorkforceHero definitely helps us manage that. It's very easy to just look at a screen, be able to see how many people I have in picking, how many people I have in packing, and then help me balance it out. Maybe Tomasi is light on replen or cycle counts. It really, really helps. You were showing me earlier some interesting things that you were doing in Excel to track employees' time off task using the WorkforceHero data. Explain to me why you're doing that and what the goal there is. The biggest reason I'm doing that is so that I can see how much downtime there is with the associates. The warnings come after three minutes of no activity detected. The warning is the automatic ... when it turns red on the board, right? Yes. It'll turn red as a visual cue, but it also tracks it in the system so that I can action and, say, look at several employees over multiple shifts, and say, "All right. In the AM shift, there's X amount of downtime. In the PM shift, there's almost double or maybe even triple at times." That way, I can look and try to figure out why we are having such an issue in the PM shift, whether it's a system issue, whether it's lack of orders, in which case, if it was lack of orders in the PM, I would just get on my supervisor to reshuffle and move more towards inventory and cycle counts. Utilize them better. Yes. So basically, you go to WorkforceHero, you export the warnings, you do your pivot table, you do your analysis, and then you say, "Okay. Here's what I learned this week." Maybe there's a problem with a person. Maybe it's a problem with the shift. Maybe everything's great. Then you take your actions from there. Yeah. All right. Let's say you can go back in time and give Ryan on his first day something to think about. What would you tell him? I would say ask more questions. I made a lot of assumptions when I first came in. Everybody at ShipHero is kind of like an open book. If I would've reached out more, I probably would've learned a lot more earlier. I did a lot of double work trying to figure stuff out, but that comes from past experiences where I was one of the only people to figure it out. Yeah. I think if you ask Rob a question, he'll spend four hours explaining you the answer. He's usually quick, but he'll definitely have an opinion. What's your favorite feature in ShipHero? Favorite feature is honestly WorkforceHero. Every job that I have had, I have wanted the data and the metrics of individual employees, to see who's working on what almost every single hour of the day. This is finally allowing me to view that and create actionable data. Any tips for a new GM of a building for labor force management? Not the technology, the people side of it. The biggest advice I'd have is just to not be afraid to ask people what they are doing. A lot of times, managers and supervisors are kind of scared to have that initial conversation, especially with the new- They don't want to seem like they're harassing them or bothering them. But feel free to ask them, "Hey. What are you doing?" and just reinforce it. Ask a question. Like, "I'm just curious. I want to learn. What do you do in the first hour of work? What do you do as soon as you get off of lunch? What are you doing right now? What is going through your brain?" Ask the question, right? Exactly. We always ... believers in ask the question, you get an answer. That's great. Can you give me an idea of what the new employee onboarding, not the HR part, but the training, and where are you start them, and where you move them to when you bring a new associate in? Right now, once I get through the HR training, they come directly to the floor to one of the supervisors who immediately pairs them with an associate who can train them on the basics of what their task is going to be. It's a peer training? Yes, peer training. We do that for a couple of hours or until the associate is comfortable. As soon as they are comfortable to be able to operate on their own, we let them go do their thing, check in every once in a while. At the end of the day, we'll review logs, if we can, to see how well they did picking, how well they did packing. Some stuff is a lot easier to get them out into the world than others. Do you typically start with picking or packing? Always with picking. Picking. Interesting. Okay. Yep, 100% starting with picking, because if you make a mistake in picking, you're going to catch it in packing. If you start them in packing, then it's done. That's smart. You bring in a new picker. I assume you see in the hero board, at the end of the day, how many units they picked, right? Yes. What's the UPH, the units picked per hour, that's like this person needs to be retrained or let go, versus they're safe, versus this is a superstar? For me personally, I try to keep it at 100 per hour. That would be a this is a solid associate, we're going to keep investing in them? Yes. What about day one? Because day one, day two, it does take some time, right? Are you seeing that right away, or does it take a couple weeks till they get up to that level? It typically takes about three to four days ... Three to four days? ... to get to that level. It just depends on what we have in that time period. Because if you're doing a multi-item batch right off the bat, pretty easy to hit those numbers. If you have them working on custom or other specialty types of things, those numbers are going to fluctuate wildly. Socks are faster than standing desks. Yes, absolutely. Now, what's the trigger that's going to say, "Okay. I'm going to now cross train this person for packing"? How do you know they're ready to be trained in packing? Partially, it's time. Secondly, it is how many errors. How much time? Most of the time, about a week, maybe a week and a half. I prefer to have them pick, so then we can move them over to packing once they feel comfortable and they almost feel like they can pick in their sleep, as long as it's a low error rate. We are tracking if an associate puts too many items into a bin or too few items into ... I'm sorry, into a tote. How are we tracking that, by the use of the hospital button? How do we know? We use by the hospital button, and then the WAM or a supervisor will look at it. We just internally track if there was an error, what the error was,- not in tote, extra items in tote, things of that nature. For people who don't know, WAM's a warehouse account manager. What's a WAM's job? The WAM's job, it's massive. Okay. A super important role. Yep. Super important role. Kristian leads them. She's our chief WAM officer. Shout out to Kristian. All right. The WAM for us here in Vegas, they are a lot of the main interface between a customer and us in the warehouse. So on top of the other duties that they have, they're the main voice that we have. If we have an issue with a product, and we find out maybe something is noncompliant, or we're having issues in terms of automation such as an item is too big and it's showing up in a multi-item batch, it really should be custom, they are the ones that take that off of my hands and my manager's hands to get it fixed so that we can keep our pickers picking efficiently. The reason why we introduced the WAMs is customer support, instead of going to the warehouse manager, instead of going to Ryan with every question, can now go to the WAM. The WAM can address those customer specific issues and leave the warehouse manager, general manager to manage the team, manage the floor, manage the process rather than get buried in customer specific things. I'm not sure that WAMs are an acronym anyone else uses, but WAM's been a super helpful innovation that we've been using here at the ShipHero fulfillment warehouses. So recommend you guys try that. WAMs also deal with problem totes, right? Yes. If there's a tote that has an error, missing a product, won't scan, they just get through the resolutions on all those as well, right? Yep. Anything from a short pick to address issues, label issues, all sorts of stuff. All right. Can I have you walk us through how the packing stations here are set up? Are we going to do that physically over there? Yep. Okay. This is one of our pack stations. It is where we ship out all of our multi-item batch and single-item batch orders. It is designed to go from left to right and to not to touch anything whenever possible. We scan the totes. We scan the items. We then go to select the boxes. We've got smaller boxes up top. We have larger boxes down below, as well as poly bags. The idea is for a packer to never have to touch a mouse or a keyboard. Everything is basically automated to the point to where they only touch the box that they select. They build it. They scan the item, pack it out, seal it up, label it, get it on out into the mail totes. We do have lights at the pack stations. Our packers, when they go to the station, they turn it green, so that way, the water spider or any managers knows who's at a pack station and which ones are empty. If they're running low on supplies, they turn the light yellow. That alerts somebody to come and give them assistance. That's typically if they are running low on 6, 4, 4 boxes, poly or anything like that. If for any reason a packer is unable to complete their order, they turn it red, whether that's they don't have any totes, there's a system issue. They are basically dead in the water and they cannot do their job. If any of us sees a red station, a manager, a supervisor or a water spider will pretty much make that their top priority to try to fix. The water spider's main job is to ensure that the packers are well fed at the stations with totes, boxes and supplies so that they can try to focus on just packing out as many orders as possible and not worry about anything else. Their job is to bring them everything that they need so that they don't have to leave. Also troubleshooting anything that may go wrong with a station. The other thing is if it's going to take more than 30 seconds to fix, we're just going to have the water spider move them to another pack station. That's why we have ones that are empty, that aren't being used. That way, we can troubleshoot the issue if it's a longer fix, and keep the flow going, and ensure that the packers are going to hit the numbers that we want them to hit. If we have a problem tote, whether it's you don't have all the items you need, it's a label issue, anything like that, we do have a hospital button. In the middle of packing, if you have any of those issues, you hit the hospital button, you turn it around and put it back onto the cart. It's going to go to the WAM to get looked at and resolved. We have two cameras. We have one that actually hooks into the computer and one that works off of wifi. The one for the computer is for the orders. When we hit the photo and label button, it'll actually take a bird's eye view of whatever the packer is packing. Then we have the wifi ones which actually connect to a device over at our outbound command center. The device at the outbound command center, we just have pretty much every single pack station on the screen at the same time, so we can just try to make sure that people are adding the appropriate amount of dunnage, people are using bubbles when necessary, and that they are sealing up with the appropriate amount of tape. When we do void fill, we've got a couple of options. We either have bubble wrap, which is down here, or we use the paper void fill, which is going on behind me. It's automatic. If you pull it, more comes out. If you need longer rolls, there's a pedal down here. I can make an endless amount come out. Vegas is unique. We are a very hot facility, and we are in a very arid and dry climate. We have something called evaporative coolers which help keep our employees cool. What that is basically just a giant wet fan on the top of the building that sucks in moisture and throws out a cool breeze. We also have fans at the packing stations. During the hot heat days of 100 to 116, 120 degree weather that we have, we also provide our associates with Gatorade and electrolyte packets so that we can ensure that everybody is staying hydrated. The way this is taped off, I think you came up with this. Yes. Explain to me what we're doing here. Everything in a warehouse should have a flow. It comes into the building. It comes out of the building. Right now, our pickers start at that end of the building, and they finish all the way at the far end. They put their carts completed over in this area. We do follow FIFO for the carts that are being done. Where we're standing right now, the expediting priority area means that it's going to the front of the line. If somebody picks an expedited priority cart, it comes here, the water spider is going to bring it to a pack station first. All our regular orders that are due today that are not expedited priority, they all come right here. As they're picked, they're packed. We don't give any preferential treatment to any customer over another. We just get out whatever gets picked first. The way I understand this works is any order that's expedited priority or urgent, those carts get staged in this box. Right. As soon as there's an available associate to pack out orders, the water spider takes from this area first, gives it to them. Yup. Once this area is empty, they grab the first cart in the default area, which would be the first picked on the day, bring that to the packing area, keep working through it in order. So the first cart picked is the first cart packed. Correct? Correct. So we don't end up with someone, let's say, cherry picking and say, "Well, that's a tough one. I don't really want to pack that out because that has a lot of bubble wrap," and they choose to skip one. Right? It's FIFO, first in first out. You get what you got, right? Correct. Then we have over there custom. Those have a separate station that's just got a bigger area to pack on. It's not on the desk, it's on its own standing little scale. Right. We have that staged separately so the water spider knows to feed the next custom station with those. There's no mixing, so you don't get a custom accidentally mixed in, Right? Correct. This the way it works? Yeah. The important thing, and why I like to run FIFO for the carts, is that at 10:00 AM every single morning, we have already packed out all the orders that were picked the previous night. So we can run an age tote report, and see if there are any that maybe didn't make it into hospital or are just missing, so we can go find them, action them. We don't run into, "Well, this tote was picked two days ago. Why is it not packed out yet?" We get ahead of it. So the way you make sure that no totes sit and wait until the customer complains about it is you FIFO all the carts, first and first out, which means if by 10:00 AM today there's a tote that was picked yesterday, you know it's not waiting, which means it's in the problem tote area or some other issue, and you know to dig in. Correct? Yep. All right. If you have any questions, please put them in the comments below. Don't forget to smash that like and subscribe button.
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