Applying Labor Management

One of the biggest cost factors in a warehouse is human labor. Labor Management (LM) records, measures, visualizes, and documents the productivity of employees. LM functionality also helps to determine the number of employees required for the current workload.

Using engineered labor standards, LM functionality helps you to evaluate the performance of your warehouse employees. After executing a planned task, LM can compare the time planned for that task and the actual time required for that the task (for an employee). LM functionality can trigger incentives such as bonus payments using a HR system (which can be connected).

Before you can use any function in Labor Management, LM must be activated in Customizing. This is done at the warehouse level and at the internal process step level. LM can then be deactivated for selected external process steps. Through this combination, it is possible to decide in great detailed which processes are really LM relevant.

After LM is activated, certain processing transactions require that a processor, start time, and end time be entered. The transactions affected by this can be:

• Warehouse order confirmation
• Physical inventory processing and counting
• VAS processing transactions
• Quality management-related transactions

In work center-related transactions, the end times are determined automatically from the warehouse time if they are not entered manually.

In RF, start and end times are determined automatically and the processor is determined based on log on information provided by the system.

In addition to the data already provided in SAP EWM, master data must be entered in Labor Management (LM). This data represents the warehouse employee and is defined as a business partner with the role of processor.

If a processor uses RF, he or she is linked to their processor number through their system user-id. When a processor executes a warehouse order, the start date and time are automatically recorded. The end date and time are logged when the warehouse order is confirmed.

The master data processor has important information recorded about the processor, including:

• Their warehouse assignment
• The process steps he or she executes
• Their labor factor (representing his or her rating)

By selecting relationships, you can define the processor's role in a group. For example, as a group leader the processor has more authorizations than as a group member.

There are three basic types of labor time. Direct labor is recorded when a Labor Management-relevant document such as a warehouse order is completed. Indirect labor can be captured for activities not connected to a standard warehouse activity, using a indirect labor task (ILT). Time and attendance is used to store time events like clock-in and clock-out.

To capture data for planned and executed workload, corresponding documents are created in SAP EWM for the planned workload and for executed workload.

The planned workload document shows the planned duration, calculated by engineered labor standards. The document for the executed workload contains the planned duration and actual duration (including processor and start- and end-time of the execution.)

You use the document for the planned workload as a basis for planning your resources. After executing the planned work, the system sends the relevant information to the executed workload document, and then deletes the planned workload document. The document for the executed workload can be used to compare the planned and actual durations. You can send the result of your evaluation to a HR system, using a performance document. This may then trigger a bonus payment, for example.

Performance documents are used to evaluate the executed workload (EWL) cumulatively for each processor. A performance document enables you to perform an employee-related evaluation of the executed workloads for a chosen time-period. It contains the cumulative planned and actual execution durations of the assigned executed workload and the labor time of the employee. Use this to draw conclusions about the performance or utilization of the employee.

When a workload is created or an incomplete executed workload is completed, the system determines a labor activity. For example, a labor activity is determined for the workload for a warehouse order that includes one or more warehouse picking tasks.

There are two approaches to determining labor activities:

• Using active labor activities directly:

  The system uses this approach if there is a 1:1 relationship between an active labor activity at the warehouse level and an external process step. This approach is always used for indirect labor, for example, changing a battery.

• Using a decision service in BRFplus:

  The system uses this approach if there is not a 1:1 relationship between a labor activity and an external process step, for example, in the case of picking or staging. A decision service in BRFplus determines the labor activity at runtime by considering context-dependent information such as external process step, activity area, material group, location, or reference document data (such as warehouse order).

If you do not use labor activities, you use external process steps and a work step sequence to determine the required time. You do not need to use labor activities to calculate travel time, or to define engineered labor standards (ELS). However, there are several advantages to using labor activities.

The travel distance calculation calculates the distance that a warehouse worker must travel to complete a warehouse order. The distance can be calculated directly or by using networks. Such networks can be created manually or programmatically. If a network does not exist, the system uses one of two distance calculation techniques: the Euclidean method or the Manhattan method.

There are two types of networks:

• Storage type-specific networks, which you define for each storage type

• Global networks, which connect storage type-specific networks to each other

Travel Distance Calculation Networks

Travel Time Calculation

You can use BRFplus to calculate the travel time for planned workloads and the adjusted travel time for executed workloads. The travel time is recalculated to give the adjusted travel time because it is not known which resource executes the workload until the executed workload is confirmed. Therefore, the adjusted travel time takes into account additional information such as the actual speed of the resource.

If you do not configure any BRFplus content, the system calculates travel time based on SAP EWM fallback logic. There the total travel time is the horizontal travel time plus the vertical travel time. With BRFplus, you can also use consolidated section information. This lets you consider each section of the calculated travel path separately. For example, you might want to consider turns and stops in the travel path, because they limit the maximum speed of a resource. The shorter a straight segment is, the less likely it is for the resource to travel at its maximum speed.

Engineered labor standards (ELS) are used to define the times that are required to execute an activity in the warehouse. The system calculates ELS when:

• Creating a document, when the system generates planned workload.

• Confirming a document, when the system generates executed workload.

The system saves labor standards in the planned workload as planned duration, and in the executed workload as an adjusted planned duration. Final data is only available when the document is confirmed because it is then when the executing resource is known. Other final data includes:

• Speed of the resource

• Last position of the resource prior to executing the activity

• Travel distance allowed for the resource

The system uses this additional data for the travel distance calculation. It saves the results of the travel distance calculation in the planned and executed workload. (You can include a formula or condition as parameters when defining the engineered labor standards.)

Whenever a document such as a warehouse order, a physical inventory document, or a value-added service order is processed, and the activity in this document is connected with a Labor Management process step, it is necessary to enter the processor, and the end time of the processing of the document. When processing these documents with desktop transactions, the person entering the data is usually not the same person who did the physical process in the warehouse. This makes it difficult to use Labor Management when using desktop transactions, because it would mean that the processor has to write down the times for each document and the information must be transferred manually.

When working in the RF environment, the system determines the times automatically. One condition for this is that the user working with a resource is connected to a processor.

Planning and simulation has two primary functions:

1. Operational planning, including preprocessing

2. Simulation of planning

Preprocessing operational planning is necessary, for example, when the user wants to plan work that has to be done the next day, but labor management relevant documents (like warehouse orders) are not available yet. Preprocessing gives an overview of the workload that arises at a particular time for inbound and outbound deliveries or in the physical inventory for cycle-counting. In terms of time, this determination comes before the execution. It comes before warehouse tasks and warehouse orders are created for delivery items or for cycle-counting documents. Preprocessing results are only used for planning purposes. These results do not affect the actual execution.

This figure, Basic Concepts of Planning, illustrates the planning process.

Operational Planning is used to define the calculated planning goals based on workload, processors, and a calculated measurement service (CMS). Create the planning formula in the formula editor. A planning formula is valid for one warehouse number and external process step and it is intended for calculating the number of required employees based on the planned workload, for example. The planning is based on:

• The calculated measurement service (CMS)

• Aggregated information:

  • Planned workload

  • Planned workload created using preprocessing

  • Information about processors

Operational Planning:

• Provides a short-term overview of the warehouse (the next hours or days).

• Is used for short-term determination of work and resources.

• Provides a rough estimate of the workload.

• Considers one or more activity areas and external process steps.

• Is based on the aggregated values (workload, processor) and measurement services.

This function determines how changes in the planning environment, such as expected workload, would affect the result. The planning data can be changed manually, and then the planning formulas can be re-evaluated based on the changed data. You can change the aggregated information, such as planned workload and processor, as well as the detailed data of the individually-planned workload records, individual processors, and the results of the calculated measurement services.

The system only saves the changes temporarily. When the transaction is closed, the system discards the changes.

After each manual change, the system initializes the results of the planning formula. If automatic-planning is activated, the result is calculated again each time a manual change takes place.