sustainaility improve performance and growth concept

30 expert tips on how sustainability can improve performance in logistics operations

How are performance targets and sustainability goals related? Spoiler alert! Sustainability does actually have great potential to increase performance in logistics operations.

Heat waves, droughts, melting glaciers, etc. can no longer be ignored. That’s why consumers, employees, and governments demand more responsibility, transparency, and sustainable action from companies. Long gone are the times when these demands were limited to the end product. The three pillars of sustainability comprise social, environmental, and economic factors across the entire value chain. Thus, logistics companies must also ask themselves how they can profitably implement sustainability factors.

Can the reduction of the CO2 footprint, occupational safety, and financial guidelines be anchored in your operation in such a way that productivity remains high?

Economic, ecological, social sustainability factors that improve performance

Research suggests that “sustainable warehousing has tremendous potential to achieve goals of sustainable development”. Here are some examples what impact the different dimensions are likely to have on performance and costs.

Economic

Optimizing inventories in such a way that there is neither waste nor loss of sales is obviously sustainable. Less obvious may be the effect of good shift planning. If employees are given sufficient opportunity to rest and their biorhythms are disturbed as little as possible, their productivity increases. Also, efficient maintenance management helps to avoid incidents like damaged batteries, low tire pressure, loose screws and thus, reduces costs.

Ecological

Oil, gas, and coal are still widely used. Changing to renewable energies such as photovoltaics, wind energy, or biodiesel is not only sustainable, but can also contribute to lower costs in the long run. Water conservation through the use of rainwater offer further savings potential. Also, training employees on topics such as fuel-efficient driving also makes a lasting contribution to cost reduction.

Social

Studies prove that sleep deficiency has a negative effect on health and productivity. Balanced shift plans with rotating night shifts promote higher performance and employee safety. Like optimum usage of daylight, comprehensive trainings and a good work-life-balance have a positive effect on costs. A poor lighting scheme reduces visibility and thus, can lead to lower performance and a higher accident risk.

List of best practice methods

Sustainable logistics operations are even likely to increase their productivity. Here is a list of best practices that can make an impact.

Use renewable energy sources for running warehouse operations
Lighting scheme with maximum use of natural sunlight
Efficient artificial lighting
Set warehouse temperature at a level that uses a minimum amount of energy
Conserve water through latest water-management techniques
Minimize noise pollution
Enhance biodiversity of the facility and its surroundings
Optimize warehouse layout to minimize travelling distance for daily operations
Use a storage system and strategy that optimizes the warehouse operations
Avoid congestion by elaborate aisle design
Arrange warehouse departments for the most efficient workflow pattern
Optimize inventory levels to avoid both obsolescence and lost sales
Ensure accurate inventory records
Adopt policies to ensure work-life-balance for employees
Design shift roster in a way that minimizes disruption to natural body clocks
Ensure both technical and soft-skill training for warehouse staff
Maintain high standards of occupational health and safety
Use MHE that has environment friendly energy sources
Introduce comprehensive maintenance management
Train operators on fuel-efficient and safe driving
Optimize inbound processes for efficient unloading, receiving, rework and put-away
Optimize storage processes to improve utilization of storage space
Optimize picking process such that picker’s travelling time is minimized
Optimize outbound processes for efficient loading and dispatch
Provide welfare facilities (e. g. wash rooms, canteen, changing rooms) to all employees
Maintain an emergency/medical room with proper facilities and trained staff
Use cross-docking to enhance operational efficiency and customer response time
Establish a recycling facility onsite to minimize waste production
Implement a robust, scalable and reliable software system for performance measurement
Develop a warehouse strategy to improve sustainability performance using intelligent software