Why do Employees make Mistakes – or do they?

What mistakes; not to be laughed at, employee mistakes waste money, waste time and then there is more money and more time required to fix the mistakes. So how do companies and managers reduce the number of mistakes, how do managers get their employees to be more conscientious, more aware of what they are doing? Are there any proven methods for reducing the occurrence of mistakes? How do we even begin to look for these methods that work? Well the first and most obvious place in the i-Age is a search of the internet, it’s here we find promulgated, a multitude of corrective measures, suggestions and indeed ideal methodologies, all proposing concepts and solutions such as: “Turn mistakes into learning lessons, develop strict policies, consider the employee’s track record, consider motivation” and then random comments in the likes of: “Watch your language and don’t yell”

I don’t disagree with many of these ideas and methods for improving the employee’s ability to do the job, just as I don’t agree with quite a few of these either. But most of the ‘solutions’ currently found are coming at the problem from the wrong side, they automatically assume mistakes are all due to the employee; yep, their motivation, their lack of skills, training or even their focus (distractedness). Yet even when these are addressed, the problem of mistakes continues.

What’s the Point? Well it’s all about the question being asked, after reading most researched “solutions” it is obvious they have assumed the question is “Who made the mistake, then why”.  They continue to miss the most pertinent point: nearly every single employee; worker, manager or executive does NOT come to work to make mistakes, I have never heard of anyone waking up and thinking “wow, I am going to try and shorten my tenure with my employer and wreak my self-esteem at the same time by making mistakes”.  Yes, I do acknowledge there are those who want to sabotage their work, or that of others, but that’s a different situation/symptom.

Why not the Who? Before I get to this, I want to provide a clarification on what is a Mistake is. In simple terms it’s “an action, decision or judgment that produces an unwanted or unintentional result”. In this case we are talking about are errors of judgement happening in the workplace. And, the key point here is that it was unintentional or unwanted. Specifically, the employee did not want or expect that particular outcome.

I believe the typical questions regards mistakes need to be rephrased. When a mistake is identified the question in the first instance should be “how did the system fail the employee” (I know this works, this is a question I ask). This does not mean the system or process was too loose and we now need to make the process absolutely tight and regimented so there is no room for error. This would be counter-productive, time consuming and cost prohibitive, remember some mistakes are a blessing in disguise as they are often when the ah-ha or eureka moment happens. It’s about identifying the gaps the promoted the mistake or left the employee blind-sided.

The Point is: the first time a mistake is made, we should be looking at all the supporting functions, actions, processes and interactions that enhance, inhibit or don’t add value to the employee in doing their job effectively. So, before an assumption is made about the employee being the one “at fault”, a review, audit or analysis should be conducted on all the  mechanisms supporting the employee, including what levels of training, the on-hand tools and equipment, the support received from their supervisor/manager/peers, the IT systems, available information, etc. etc. The review should also look at whether similar issues or problems have happened with other staff, and if there have been complaints about, or suggestions to improve systems and processes, and don’t forget the culture and any imposed stresses. Is the employee’s manager (is this you?) doing the right thing by their staff, is stress being redirected to the employee unnecessarily?

The purpose of a review is to correct any insidious, systemic gaps which often get missed in the “normal” course of business. Now, this review also needs to be measured, the effort put into the review of necessity needs to be commensurate with the risks and costs. If it’s a small mistake with low risk and low cost, a simple review can be carried out and all within an hour or so, whereas, on the other hand a high risk, high cost error in judgement should command a lot more attention and resources. Careful consideration must also be made of the low level mistakes that indicate a bigger problem lurking in the background, gaining in energy and intensity – for example bullying and intimidation in the workplace. Although the mistake itself may have been small, a culture (workplace) that is growing in toxicity will eventually have to address an even bigger problem which goes beyond the individual and get the attention of the regulators and law makers, which will not be good for business.

The employee is not absolved. Although there is a focus on identifying the cause of the mistake, which to now is not yet on the employee themselves, the employee must still take responsibility for facilitating and participating in identifying, clarifying and resolving the mistake.  Being so intimate with the issue, they are in the optimum position to work as explorers and collaborators on this project. It is also in their-own best interest to identify the source, the cause of the mistake (obviously). This first tranche of finding the source then addressing it to limit the potential of more inadvertent costs, it can also provide us two more positive outcomes – specifically, those involved in the project are also learning and gaining experience in the identification of more potential problems and causes. And folks, that’s not all, the employee now feels a valued part of the organisation (if they didn’t before, they do now) and will have a more positive attitude towards the role, their manager and the company. Now that’s great, how many win/win/wins is that?

Damn, it’s happened again. If after doing all the previous work on stopping a mistake, there appears another very similar one, a very short question now needs to be asked: “did we solve all underlying issues or was this an error solely based around the employee”. If we recognise there are still underlying issues as not all were found and resolved, the next action is quite obvious – “Go back to start” and begin again.

Let’s just assume we did do a good job and all is well on the systems side of the equation, covering external events potentially impacting the employee. This then leaves the issue plainly with the employee, we now need answers to a number of questions but with an employee focus and in the form of what happened, how did it happen and why did it happen. We are trying to get to know why the employee is acting, reacting and responding to the situation in the way they did. This is to understand what triggered the decision, what caused the employee to make the decision they did from an intern al perspective

We are not only focusing on our investment in human resources, we really are also concerned about the overall health and welfare of our staff. Each one of us will react differently across a spectrum of pleasures and stresses. Some achieve great things under a particular type of stress, yet under the same stress, others can collapse and not function effectively, or even become dysfunctional, they may even make mistakes. When making enquiries at this second stage, the goal is to find out on a personal level what is happening to encourage this particular employee make judgements as they do.

Too many questions will definitely not solve the issue and may in fact push any opportunities underground. Here we are working on a personal level. It needs to be one to one, a relationship based on the mutual need to solve a problem that is having a negative effect on all stakeholders. Again, people do not come to work to fail, so what is causing this lapse in good decision making. When working through the problems at this second stage, the questions need to cover how the employee feels and reacts to situations, how is their physical health, how is their mental health, how are their personal finances, are things ok at home, is the family well, etc.  Very few people have the capacity or skill set to leave all their personal life at home and leave their work life at work. For some personalities it is very obvious, for others it’s an increscent noise at the back of their head which can distract them or affect their ability to think clearly – or maybe even rationally.

An offering of help can make a big difference. Once they open up (voluntarily) and provide information giving an insight to where they are at, options become possible and made available to help them. It could be anything as simple as a paid day off, or some advice on managing personal bills. At other times it might just be allowing them to state what is wrong and show them they will not be judged (this one works well) and best thing about this option, no people or animals are hurt or injured in the process. They just need to put their points, concern, worries and maybe suggestions on the table – I have found people may not say anything so as to not offend or worry the boss, or to look like fools. In one real case an employee even thought they would lose their job if the boss found out they had a medical problem – that boss was me, they eventually told me about their need to have an eye operation. This was a good outcome as it meant I did not need to follow through with the disciplinary action that was about to be presented for the data entry errors (mistakes) they were making.

As I have said before, people do not want to fail, they want to enjoy their job and they want to earn the respect of others by doing a good job. As managers, we need to allow them and help them, to do their job.

Where are we now? Ok it looks like we have crashed into the last stage, which means the first two options did not address the cause of the mistake. Yet getting to this stage in the process does not mean we disregard the good work already been done, we have to acknowledge that this time and effort was not wasted, quite the contrary. Holes and gaps in the system will have been identified (no system is perfect, if you did not find something, then you weren’t looking properly), people went through a learning opportunity, plus other employees will have seen the effort taken in the first two stages, making them more comfortable in the fact that the people aspect is always considered and not just a tick box, thus generating respect (nothing to do with likability or being mates).

When all else fails and we are at the final option, it means the same mistakes have continued happening and we know the system does work in supporting employees and all relevant areas of the employee’s personal  situation have been explored and appropriate support provided. It now comes down to some really basic questions. Literally – is the employee up to the job, do they have the right attitude, have they given up, do they want the job?  Remember all those experts on the internet explaining how to get the most from the employee?; well this is where they come in, sort of/maybe. For me, the better option is to talk to the HR department and see what official options there are left (there are laws and regulations that apply when we get to this point). HR can advise if the employee should be “coached”, go on a PIP (Performance Improvement Plan) or be Walked off – remember as managers we should be taking the initiative and not just passing difficult employees on to HR to “sort out”.  Yes there not many options left by this time, but having already analysed and reviewed for system/systemic gaps (and probably made improvements), as well as attempting to help at a personal level, ownership of the problem is now 90% in the employee’s hands, they now need to decide whether they want to change and stay or won’t and go.

In its simplest form, this means we first find out what is stopping the employee doing their job the way we want, the next phase is to help the employee in a personal way, if no improvement, back to the “old way of dealing with mistakes”.

There is a huge caveat though, if this is to succeed, the manager must act like a leader and be emotionally evolved enough to realise the issue may not be with the employee, and yet strong enough to go through with the whole process – to the end if need be.

I hope this helps in some way, this has helped me with my staff.

PS: you do not need to be the manager to bring this about, if you made the mistake, take the bull by the horns and start the process yourself, its the type of proactive steps managers appreciate.

Is your 3PL Provider an Expert

“Improve your competitive advantage, reduce your warehouse and distribution costs by up to 20% and improve customer relations, minimize your CAPEX” etc. These are some of the headlines often espoused by Third Party Logistics companies (3PLs) looking to gain your business and they are not totally wrong, but not all is right either, there is another side to any 3PL arrangement (as with any service arrangement) as many will have found out the hard and usually in very expensive way. As you may have guessed from the opening, for this series I am referring to asset based 3PL warehousing (the services provided by these 3PLs are at their facilities and not owned or operated in anyway by the Client).

To set the scene a little background may be appropriate – 3PLs are those entities to whom Client companies pass responsibility to for the control and management of part of their supply chain, in this case warehousing and distribution. As more control/management of the supply chain is given over to the 3PL, the more complex the agreement/contract becomes. 3PLs are usually engaged to fill the gap between your knowledge, resources and experience – meaning some Clients are often not even aware of how the arrangement works or even what a 3PL can do for them, thus making it difficult for themselves and the 3PL Provider to each get the most from the arrangement in the long term.

I will be writing some articles to help Clients understand the relationship, with the intent of building long term, collaborative relationships with their 3PL Provider. The articles will be broken up into different facets of the function/relationship – for example: information technology, collaboration and expertise, etc – where I provide the benefits and possible downsides. Having a knowledge of potential issues or being able to identify a current one is critical and could be the difference to making a profit or just making the relationship costly for both companies.

The first in focus is:

1.            EXPERTISE

Benefits

3PLs have experience in the storage, picking, packing, sorting and arranging distribution of orders. They will have the experience to identify and mitigate potential issues and know how to quickly resolve problems. Having skills in best practice, they will be working efficiently and effectively thus ensuring they can maintain minimum costs to them AND to you, whilst ensuring the integrity of the goods from receipt to delivery.

Whether they are using the latest 3PL Warehouse Management Software (WMS), integrated with Transport Management Software (TMS) or are using a legacy system, they will still be knowledgeable to the point they will know what reports you need and what access you will require to enable you to clearly and simply know your stock situation (24/7) and to know what is happening with each and every sales order/stock transfer up to the point of delivery.

Your chosen 3PL will also have expertise in the same industry you operate in. For example, a beverage 3PL should know how the beverage industry works, along with all the idiosyncrasies that go with that industry, which would be different for FMCG and again for industrial goods. This includes not only the inbound transportation, storage and distribution but also the Reverse Logistics which, due to e-commerce, is a growing business in itself.

All 3PL staff will have the relevant knowledge and experience to support your company and your customers, relative to their role/position.

With you being able to trust that the 3PL (as a whole) has the expertise to store and provide, not only the stock as and when required but also the information supporting the agreement, you can then focus on your own core competencies, resting assured you are leveraging the expertise of reliable and experienced professionals, providing value for money, keeping overheads low and minimizing your need to input time and labour into managing the flow of stock.

Risks

Unless you are aware of the potential risks (and indeed opportunities) there is a chance you will miss them, this is especially the case when talking to a perceived “expert” – remember they have many clients and receive regular enquiries from potential clients so they know exactly what to say and when to say it – whereas you would rarely be sourcing a new 3PL (hopefully).

So… I will start with an analogy for clarity. You are a passenger on an Airbus A380, you sit back and relax assuming the aeroplane has been checked correctly by properly trained and qualified LAMEs (Licenced Aircraft Maintenance Engineers). Another LAME, trained on Airbus A320s could probably do most of the checks and reviews but when it comes down to it, you do not want to drop from the sky because the LAME missed something critical to the A380 but not so on an A320. Even worse, a LAME trained on B 737s may have got the role – just because he could “talk the talk”.

Obviously, this would never happen on a commercial flight, as the aircraft are maintained to standards set by the respective domiciled country, for example CASA (Civil Aviation Safety Authority) in Australia, as well as IATA (International Air Transport Association).

Clients of 3PLs must do the same. You must know and agree the minimum standards and require the appropriate level of expertise from all personnel of the 3PL, relative to their position.

Typical problems that may be encountered by having a 3PL with less experienced or suitably skilled management and/or staff include:

  • Lower levels of efficiency – this will impact directly on the 3PL as their labour costs will increase, but ramifications may affect your business, for example the 3PL taking shortcuts to get the job done (still charge the same), with your customers not receiving their orders when expected – review the SLA (Service Level Agreement) as the 3PL will may have an unreasonable buffer built in e.g. Sydney to Sydney should be “Next Day” but the agreed SLA might say 1-5 days! Unlikely, but possible.
  • Higher expenses – by not correctly checking stock at time of receipt you may miss the chance to place claims on vendors for incorrect supply or on carriers for damaged deliveries. Other higher costs could be internal loss/damage (by warehouse staff) although a 0% SLA is a tough one to get into the agreement it should not be too loose either.
  • Increased errors and mistakes – picking, packing and dispatch errors will affect not only you but also your customers, it may cost the 3PL (or you) to correct the situation but this will not make the customer think any better of your customer service (especially if it’s a regular occurrence). Remember, your 3PL’s performance translates to YOUR performance – good and bad.
  • Lower levels of DIFOT% (Delivery in Full, on Time) –similar to above but this includes timeliness. If the Customer does not get their full order, when expected, there WILL be repercussions. Whether the under-performance for this SLA for example, was due the 3PL’s stock control being out of sync thus impacting your ability to raise purchase orders effectively, the result is still a very upset customer.
  • Miscommunication and slower response times due to a lack of understanding of your specific needs and requirements – Having functional as well as industry expertise ensures the 3PL understands your requirements as to what, when, where and how much and can quickly communicate to you if there is an issue or indeed any form of confusion, i.e. they should not need an interpreter or prompting.
  • Cost control – without functional and no less, industry expertise, costs may not be effectively managed along with ideas or suggestions on cost saving measures not presented to you. If the 3PL is also not professional, they may even restrict the presentation of ideas that may reduce their overall revenue e.g. suggesting a different Carrier to lower overall transport costs may affect the 3PL by lowering their mark-up on freight revenue.

Take-away

Prior to contract

  • Included in the Tender Process should be section to ascertain the skill/experience level of the 3PL, this can be by the 3PL providing references from actual clients and providing copies of the full resumes for the management team – from supervisors up.
  • Ensure the referees ARE followed up and questions asked regards when things are going well as well as when things go wrong (this will add a lot of value), then review the resumes. Each of the management team should have direct experience of at least 5 years in warehousing (at the respective level) and at least 1-years’ experience within your industry.
  • Remember to ask questions about:
    a.      How they manage the Supply Chain
    b.      How long they have worked in your Industry/Niche market
    c.      What SLAs and KPIs (Key Performance Indicators) they have in place to monitor efficiency, effectiveness and accuracy
    d.      Include subjects such as their Strategic workforce management and
    e.      Reverse Logistics/End of Life supply chain management (especially for e-commerce)
    f.       Focus; are they Process Driven or Customer Centric (lucky to have both)

 In Current contract

Being in a current agreement with a 3PL you should already have garnered most of the 3PL’s skills. That said, if you have any concerns about your 3PLs performance then ask to see the resumes and review the SLAs and KPIs on a regular basis. If the resumes are lacking or the SLAs and KPIs are anything other than optimum (and reasonable) then you should open discussions with your 3PL Provider and agree new SLAs and KPIs – and what happens if they are not met, and just as importantly, if they are met.

 Stories

If you have any of your own stories please share them and bring them to the attention of both potential client and 3PLs Providers. Helping everyone this way raises the bar.

My next article in this Series will be on Information Technology used by 3PLs