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LABOR MANAGEMENT Technology
MORE CARROT, LESS STICK
Since its introduction decades ago, labor management
software has become a standard tool for managing human
resources within a warehouse or DC, offering companies a
neutral method of tracking the work output of their employees. While the methodology hasn’t changed much over the
years, companies today are using the data collected by the
software in new and different ways.
For example, in the not-so-distant past, employers com-
monly used their LMS data to identify underperforming
workers so they could essentially cull the herd. “It used to
be that every month, businesses would get rid of their bot-
tom 10% and replace them with new people,” says Peter
Schnorbach, senior director for product management at
Manhattan Associates, a developer of LMS and other supply
chain software. “That doesn’t work anymore, because you
can’t replace them.”
Nowadays, the focus has shifted from performance
improvement to employee retention. Among other things,
that means warehouse and DC leaders are more likely to be
using their LMS data to identify the top performers than the
laggards. It’s all part of a push to boost “employee engage-
ment”—and by extension, retention. Workers identified as
top performers are often rewarded with perks like prime
parking spots, lunch with a top manager, or extra compen-
sation. One Manhattan Associates customer brings a large
wheel into its DC once a month, calls its top performers up
to the stage, and lets them take a roulette-style spin to win
various prizes, like the TV show “Wheel of Fortune.”
But identifying those top performers isn’t always as cut-
and-dried as it might sound. In many warehouse opera-
tions, no two tasks are exactly alike, making it tough to
draw apples-to-apples comparisons. For instance, it would
be unfair to compare two workers on the basis of orders
picked per hour if Worker A collected them all from a single
aisle, while Worker B was forced to travel throughout an
800,000-square-foot DC.
In a bid to correct such inequities, a number of companies have begun adding warehouse “telematics” data—data
collected remotely from forklifts and other warehouse
equipment—to the mix, analyzing it along with the standard
worker productivity measures.
“Everything is creating data these days,” says Derrick
Miller, enterprise solutions manager at The Raymond Corp.,
a lift truck vendor that also provides fleet management and
labor management software. “LMS has traditionally been
only about tracking how many pallets Carl touched, or how
many crates Susan lifted. But you can also generate data
from lift trucks and conveyor systems, or even track when
employees use shrink-wrap machines.”
By analyzing telematics data, warehouses can generate a
richer, more detailed profile of their workers’ activities than
they can with basic performance measures. And more to the
point, perhaps, this approach allows for a more nuanced
