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In a sense, managing a warehouse or distribution center is like coaching a football team. First, you prepare for the big game, then you play it, and then you watch film to evaluate the team’s performance. Hopefully, small improvements over time result in many more wins than losses.
For shippers, the big game is peak season, and as the calendar turns to 2023, logistics professionals are heading into their version of the film room, using data to measure operational performance during peak season. Brian Poveromo, director of facilities and maintenance at American Eagle, said that process includes examining every equipment failure or downtime incident—or, to stick with the football metaphor just a bit longer, the costly turnovers.
Poveromo said that after peak season, American Eagle uses data analytics to determine what led to those failures and if anything can be done to prevent them. When a belt breaks down or a variable frequency drive on a motor fails, for example, he’ll look back to verify whether his maintenance team had performed preventative maintenance as scheduled.
He’ll also search for clues signaling that a breakdown was imminent, including equipment drawing more amps than normal due to wear and tear. The facilities team has begun using sonograms and vibration testing to detect failing equipment before it affects operations. Armed with that data, American Eagle can identify trends and best practices to maximize uptime.
“It’s a long-term goal, but we are moving toward reliability-centered maintenance,” Poveromo said. “I don’t want to be a fireman responding to emergencies. I want to be able to catch them before they happen and come up with a prescriptive repair prior to it happening.”
Evaluating data helps American Eagle to order the right number of replacement parts for equipment leading up to peak season—not so few that they run out, disrupting operations, but not so many that inventory costs pile up. His team also will prepare replacement belts for equipment before peak season, measuring the existing ones, cutting new ones off the roll and lacing them up. This practice can speed up repairs by as much as 70%, Poveromo said.
American Eagle tracks key performance indicators (KPIs) such as the amount of time its maintenance technicians spend on each job and how much overtime they put in, he said. That data may provide insights into whether maintenance techs are receiving the proper training to handle the most common repairs, and it allows them to build repair kits containing all the parts and tools they’ll need for those jobs, speeding up the process.
By increasing efficiency, American Eagle can reduce downtime and ensure that maintenance techs aren’t putting in excessive overtime, which increases labor costs and burns out productive employees, Poveromo said.
Michael Lennard, a warehouse and logistics industry consultant with MHI member Rockwell Automation, said companies that are still handling work orders manually instead of digitizing them are missing out on opportunities to improve performance. He said maintenance data often is “overlooked as a source of insights,” preventing companies from being proactive in addressing issues instead of reactive.
“Sometimes that doesn’t get tracked and reviewed well enough for you to really understand how your maintenance processes are performing,” Lennard said. “By looking at the number and different types of work orders, and the time it takes to close them out, you can gain a lot of insights. Today, when some companies fix an equipment failure, it’s kind of out-of-sight, out-of-mind because they’re thinking of maintenance and performance as two separate issues.”
Amid the labor shortage, shippers should track KPIs such as cost per pick, the amount of overtime worked, the number of job openings available during peak season, the time it took to fill those positions and the number of workers who quit. If those metrics are especially high, then they are symptoms of a larger problem and not the cause, according to Ed Romaine, vice president of marketing and business development at MHI member Conveyco.