AP Photo/David J. Phillip
Walmart's network of distribution and consolidation centers keeps its stores stocked.
- Walmart's network of distribution and consolidation centers, staffed by 102,000 associates, are tasked with keeping its stores stocked.
- Greg Smith, the executive vice president of supply chain at Walmart US, told Business Insider that Walmart increased its supply chain efficiency by 13% in the last 18 months.
- "We're converting our people from firefighters into problem-solvers," Smith said.
Walmart boosted productivity at its nearly-200 distribution centers by 13% over the past 18 months.
"We have been driving productivity really hard, not necessarily by making people work harder, but by finding obstacles and finding issues of failure that we can eliminate," Greg Smith, the executive vice president of supply chain at Walmart US, told Business Insider.
Smith explained to us how exactly Walmart boosted productivity.
Standardize approaches across the distribution network
Smith said that, in the past, different facilities would have different approaches to the same tasks. Now, Walmart is pushing for one standard approach.
"Think about a conveyor belt," Smith said. "We want our conveyor belt to run 100% of the time. If it runs 70% of the time and goes down extended number of times, it impacts the productivity, it causes people to do work that's non-value added.
"So, we are seeking to standardize across the approach but then improve the work, drive the reliability, and eliminate loss," he continued.
Keep associates well-trained about new operations - and why they matter
Smith said Walmart is "going through a pretty significant change" in training its associates on new distribution techniques. That includes setting up academies within distribution centers to keep workers up to speed on new mechanisms.
That's not just about teaching systems, but why those systems are important to learn.
"We want to help them understand why we need to change and prepare for omnichannel excellence," Smith said. "We want to show them, articulate what it is that we want to go seek, so we've articulated what the future looks like and what success looks like."
One new mindset shift is called "reliable operations," in which equipment is seen as something that needs continual maintenance and monitoring. That ensures that associates know how a piece of equipment works, its likelihood to break down, and how to maintain it in a way to keep it at peak production.
The new technique also involves assigning one piece of equipment to one associate, rather than a group. "They always say the best way to kill a dog is to assign two people to feed it," Smith said. "We are now assigning ownership for equipment so people ensure that they are maintaining it and they are keeping it up to speed."
Walmart is also promoting the concept of DMAIC (define, measure, analyze, improve and control) among associates when it comes to problem solving.
"We're converting our people from firefighters into problem-solvers with the intention of being proactive in the problem-solving, so they can anticipate, see issues, and then we have a 102,000 people in our army fixing problems versus reacting to problems when they occur," Smith said.