Use the article below to where pressure was put on managers to keep variances under control or to set veryhigh performance standards. Discuss how these practices may lead to ethical issues such as lower quality end products or services.

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Creativity, flexibility and vigilance can help warehousing managers keep a lid on tough demands.

Times are good and times are tough, but the two often go together when business is booming.

The good is that the economic boom goes on. With the new century just six months away, the country is at nearly full employment and inventories are up. To deal with demand, warehouses have never been more technologically driven and, if used properly, that technology is helping logistics workers meet demand.

The tough is that warehousing managers are busier, and more pressured, than ever--and they are struggling to find workers during the boom. Forced to become jacks-of-all-trades, they're charged with overseeing their facilities' packaging operations, assembly, light manufacturing and, in many cases, telemarketing centers that have popped up to receive orders and offer customer service.

On top of those responsibilities, managers are contending with a pool of what human-resources specialists call unemployables--people who find their way into jobs that more qualified workers would be available to fill in a slower economy. Managers are also required to keep up with technology and find a way to teach users. It also means becoming a recruiter and motivation expert, because once managers find workers, they must become creative to keep them.

They're tough tasks, but managers appear to be meeting the challenge.

Juggling act

Michael L. Jenkins, president and chief executive officer of the International Logistics and Warehouse Association (ILWA), Park Ridge, IL, says management's expanded role is causing warehouse operators to recruit management from disciplines other than warehousing.

"They are looking at packaging experts or industrial engineers, which they would not have done before, because they are looking for individuals with slightly different skills today," Jenkins explains.

Brian Cronenwett, manager of distribution operations and development for Ace Hardware Corp., Princeton, IL, says business leaders expect more from management these days than ever.

"The most significant change in the expectations of management staff is the speed at which new technology must be implemented in order for the warehouse to be successful," Cronenwett says. "Ten years ago, people would talk about a new system and throw the idea around for 18 months and then, maybe, start talking implementation. Now, new technology is introduced every six months, and decisions and implementation have to be made quickly in order to keep a competitive edge."

Cronenwett says his company has put together a cross-functional team from retail, financial and logistics to determine technology needs. The effort has cut the multimonth implementation process to three days.

Customers are also adding pressure. They're demanding quicker turnarounds and deliveries, and expect quality and fill rates much higher than 10 or even five years ago. That translates into warehouse managers spending more time away from their facilities to work with customers, understand their needs and help them make systems run smoothly.

The people and talent problem

"The industry-average growth is about 15-20%, but we are seeing some third-party logistics companies grow at 50% rates, so the ability to find people has reached a critical level and management in many cases is left to look at the unemployable in the available pool," Jenkins explains.

And with US inventories growing at about 6%, the situation is getting worse.

Perry Ozburn, chief executive officer of Ozburn-Hessey Logistics in Nashville, agrees with Jenkins, but focuses on the problem at a specific level.

"The biggest challenge today is retaining, motivating and incentivizing the middle-management people so that they will stay with you," Ozburn says. "Those people with three to five years experience looking to move into site management where they have one big facility or one big account to manage--they are the toughest to get and hold. If you are a really good manager, you are being recruited on a regular basis."

Jenkins says managers are coming up with recruitment solutions. "We have a member in Wisconsin who has created a facility that was populated by welfare employees," Jenkins says. "He provided on-the-job training and after six months of perfect attendance, the employees were moved to permanent positions."

Another IWLA member in Ohio formed a company to train forklift operators.

Boosting pay, morale and training

Good salaries and incentives are keys to keeping workers. Ozburn says the best way to garner and retain middle managers is to give them a stake in the company.

"Give the person an opportunity to own part of the company that they work for, whether it be stock, or nonvoting stock or some kind of plan that gives them ownership" he says. "The next plan is incentives. Give them freedom to do something on a creative level that will improve profits, then share that with them. I believe anything you can do from a monetary standpoint is important."

Dennis Wright, warehouse manager for the Birmingham, AL-based, Strickland Paper Co., says Strickland has increased pay to entice employees. Wright manages three facilities totaling 100,000 square feet and 45 employees.

"Over the last three years, our pay scales have increased over $4 per hour," Wright says. "Most people start at $7.75 per hour and, within two years, move to $10. Five years ago, it was unheard of here for a warehouse filler to make that kind of money."

Wright says Strickland has increased the percentage of medical coverage it pays for and expanded vacation time.

Richard Moone, manager of the Pretty Products Inc. warehouse in Coshocton, OH, says he's had trouble staffing the 250,000-square-foot facility, which uses 900 workers. The company uses bonuses to keep workers.

"We started offering a $500 bonus if the employee stays six months and then $500 if he stays a year," Moone says. "In some cases, it's tough to get the employee to stay on that long, because there are just too many opportunities for them."

Wright says the challenge has taught him to be more patient.

"I remember when we used to let people go if they didn't catch on that quick," he says.

Strickland provides more hands-on training and tracks performance more closely. Wright says the typical new hire spends weeks, not days, with a top-performing employee to learn the job.

Strickland has added morale boosters like staff dinners or lunches for meeting performance goals.

Job simplification and flex time

Cronenwett's Ace Hardware facility covers 1.1 million square feet and employs more than 376 workers. He says job simplification--applying new technologies to reduce training time--is his best weapon in the hiring war.

"We are looking to get people up to 100% of our expectations through technologies, such as portable computers on the warehouse floor and barcode scanning."

Ace moved to a touch-screen computer framework to a pick-and-stick system.

"It makes them successful quicker and from a morale standpoint, that's good" Cronenwett says. "If you get the new hire to be as skilled as those around them, it encourages him to stick around."

He says most workers are in their 20s and comfortable with computers.

Whatever strategies and incentives are used, they must be monitored, evaluated and improved to meet the operational needs of each facility.

Deborah Catalano Ruriani is a Yardley, PA, journalist who writes about business.