Question: Transitioning from the freight discussion in Module Two, Module Three involves the natural extension of warehousing. While warehousing operations do not get much attention in
Transitioning from the freight discussion in Module Two, Module Three involves the natural extension of warehousing. While warehousing operations do not get much attention in the sustainability conversation, a number of warehousing aspects must be considered to establish a green operation. Warehouses are substantial operations that must link to freight modes, integrate value-added services, and position goods for distribution to the end user. Designing a green operation has to consider location, intermodal linkages, ownership, warehouse management systems, and social impact through workforce management. These subjects are not directly in front of consumers but affect a supply chain's sustainability nonetheless. Warehouse location is closely tied to an operations linkage within intermodal networks. Since a warehouse is essentially a node of the supply chain, it has to be located near ports, railheads, interstates, and airports to be efficient. These areas are historically congested and real estate is sparse, which adds another element of complexity for any new operation. This congestion makes a new warehouse potentially expensive and also adds to the environmental impact due to additional construction, freight, and operational requirements that also impact the financial and environmental bottom line. In such cases a company has to evaluate whether building a new warehouse or leasing an existing one is best for its supply chain. Depending on the scope of the operation, it is vital to assess the correct type of warehouse ownership. Smaller operations with the potential for near-term growth may find that leasing an existing space will give them the capability they currently require along with the expansion capability they will need. This is often less expensive than building a stand-alone operation and also reduces the environmental impact that accompanies construction. Larger, well-established operations may need their own facility to incorporate value-added assembly and packaging along with the autonomy to conduct business that suits their needs. In the long term, constructing a new facility may be less costly than leasing but should be balanced with the environmental impact of a new development. Once the warehouse location and ownership are decided, there is the matter of operations within the warehouse to consider. Warehouse management systems today are incredibly complex, utilizing a mixture of handpicking and automated conveyors to receive, sort, store, and ship goods. These systems make operations more efficient both financially and environmentally as they increase warehouse velocity with a smaller environmental impact. Moving freight also requires a degree of material handling equipment that should be assessed for the triple bottom line. Alternative-fuel forklifts are beneficial for reducing air and noise pollution for the workforce and are often more nimble than their diesel counterparts. While warehouse management this may require an investment in infrastructure and equipment, most operations have seen the long-term benefit across all elements of the triple bottom line. With so much attention given to infrastructure and equipment, it is important to keep a warehouse's social impact in the equation as well. Regardless of how much automation is injected into a warehouse, a human workforce will always be required to keep goods moving, troubleshoot equipment, and adapt to the constant market changes that affect operations. Even a respected operation such as Amazon faces challenges in this regard. Amazon receives both positive and negative criticism in regard to its workforce management. On the plus side, it provides work for thousands of people, especially during peak demand times of the holidays, with very good pay and benefits. Amazon also receives a good deal of negative criticism worldwide for the level of performance it expects from the workforce. High demand creates jobs, but it also creates the need for more production. Therefore, workers are often required to work long hours with very few breaks under a great deal of stress. Inventory-picking requirements grow considerably during peak periods, and the Amazon workforce is pushed to increase picking and sorting volume while maintaining a very high rate of precision. Handheld scanning devices not only help register items and map out inventory locations, they also track how long it takes a worker to get to the piece and beeps at the worker if her or she moves too slowly. What was intended as a measure to track employee efficiency has backfired and been reported to increase employee stress in Amazon's massive warehousing operations. This is a situation that Amazon and any other company operating a warehouse have to consider, as it impacts the perception of the company's corporate social responsibility. While warehousing may not get the attention that other elements of a supply chain receive in terms of the triple bottom line, it is clear that warehouse operations affect each facet of the triple bottom line. Professionals have to consider location, ownership, warehouse management, and workforce relations to balance that bottom line and maintain a sustainable operation. The task can be complex, but the long-term benefits can be great financially, environmentally, and socially for any company that wants to succeed. In your post, examine the environmental and social sustainability of warehousing operations. As you saw in Module Three's reading, warehouse operations present both constructional and operational impacts on the environment. In addition, warehouses have a social impact in regard to the workforce and the greater community. In your post, explain the following: How does the decision between owning and leasing a warehouse affect the environmental impact a company will have with its warehousing operations? When choosing a warehouse location (either to purchase or lease), prioritize ease of access to freight nodes, proximity to the end customer, and overall social impact as critical elements. How would you balance these competing priorities when selecting a warehouse location