Warehouse Startups: Organizing the Implementation

Managing a new warehouse start-up covers a lot of work. There are many moving parts and these parts have to be coordinated and managed. It can be daunting to think about whether you’ve accounted for everything. Let’s examine the work breakdown structure for a generic warehouse startup.

Typical work structure

At a workstream level there are always a few main categories of associated work. We’ll call these “workstreams.” The name of the workstream will indicate the “theme” of the associated work. These should have a business lead identified as well as project management support. The “workstream leads” each own their workstream. They are responsible for coordinating & integrating the tracks of work to deliver the workstream deliverables. Status reports should reflect the state of the workstream.

We’ll call a section of the related work within the workstream a “track.” Each track should have a definite owner responsible for its deliverables. This owner can be a functional specialist or outside consultant who is responsible for managing the work in the track.

For example, in the case of physical security, this may be a facilities team member who manages physical security at other sites. Another option is to bring in outside consultants or vendors to manage the track.

Some of the tracks can be work-intensive. For example, the site security installation can be a lot of work and coordination. But because it’s so closely tied to the site layout and building systems, it often naturally falls into scope of the Facilities workstream.

Each track may have multiple deliverables to accomplish. Each of those may be considered a “work package.” Again considering site security, one package may be the camera system; one may be access control; one may be employee screening technology; one may be visitor control.

Let’s look at the common workstream / track breakdown.

Work Breakdown

For warehouse implementations, workstreams and corresponding tracks should include the following broad categories and track-level scopes of work:

1. Operations Processes (or I’ve heard this themed as “process transformation” if a highly disruptive site)
   1. Process analysis: Developing the functional requirements for the warehouse operation
   2. KPIs: Identifying key performance indicators for the operation. Develop requirements for reporting.
   3. Logistics & Supply Chain: Coordination of required transportation assets & relationships for the operation.
   4. Quality Assurance and Inventory Control: Developing quality and inventory strategies for the site. Implementing policies and developing requirements for systems support.
   5. Planning: Developing the ramp and activation planning for the site. Developing order management, capacity, and forecasting strategies for the site.
   6. Transition to Operations: Operating the ‘war room’ during startup period. Ensuring critical business processes are identified and Operations team assumes control at the planned times.
2. Facilities Enablement:
   1. Construction: Design, procurement, and management of all construction activities.
   2. Physical Security: Design, procurement, and implementation of site physical security plan.
   3. Racking & storage media: Design, procurement, and implementation of storage media strategy.
   4. Warehouse Equipment: Design, procurement, installation of required warehouse equipment. (Everything from forklifts to fire extinguishers.
   5. Safety: During startup Safety is considered in Facilities Enablement due to strong dependencies on site Fire & Life Safety requirements for building inspection and commissioning. Site safety manager should be involved with policy & process development for ongoing operations.
3. Technology Deployment: IT departments are often organized into infrastructure and systems or applications teams. So it may make sense, depending on the scope of the project, to separate Technology into two workstreams.
   1. IT Systems:
      1. Integration: Communications with all internal and external systems.
      2. System Design & Deployment: Design, configuration, customization, of the warehouse management system and other systems in the solution system architecture. Side note – A great resource for understanding this complex work is “Managing A Programming Project.”
      3. Analytics & Reporting: Getting actionable insights and data out of the system.
   2. IT Infrastructure:
      1. Network: Connectivity in the warehouse and office areas, both wireless and wired.
      2. Computing: Servers and storage support solution.
      3. AudioVisual: Displays & monitors, warehouse and conference room A/V support.
      4. Warehouse or workplace equipment: Includes all user/tech interface points. Printers (office & label), RF scanners, telephones, computers & thin-clients setup, etc.
4. Organizational readiness:
   1. Build the team: Develop organizational strategy, recruit, hire.
   2. Training: Training strategy, documentation, and delivery plan and execution.
   3. Organizational change management: Communication of project to the wider team, project and team health, and gap analysis between current state and future state impacting peoples’ roles and responsibilities.

These workstreams are supported by shared services, including:

1. Finance
2. Legal
3. Risk / insurance
4. Tax
5. Human resources
6. Procurement or purchasing

Depending on the project and scope you may add:

1. Logistics Support:
   1. Transportation strategy,
   2. carrier management,
   3. transportation planning.
2. Material Handling Solution, or robotics/automation.
   1. Design, procurement, installation, and commissioning of an automation system such as robots or AS/RS is a large effort. It may warrant its own workstream, certainly it needs a clear lead with time and attention to monitor and control.
3. Integrated Testing
   1. Test strategy development and socialization
   2. Test plan design
   3. Testing coordination

Summary

We’ve reviewed a high level work identification and organization of work that supports many different warehouse implementation projects. It can be expanded or shrunk to suit the project. It clearly identifies the major bodies of work and a hierarchy for assigning project resources to them.

In future posts we’ll explore the resourcing of these projects in detail.