Staff literacy and numeracy issues costing logistics industry dearly

Low employee literacy, numeracy and language skills are costing the logistics industry dearly, according to a workplace literacy expert.

Momo Thet, a warehouse assistant for Pharmacy Wholesalers Russells – companies that address their workforce’s literacy issues typically experience a win-win result for themselves and their employees

Katherine Percy, chief executive of adult literacy, numeracy and communication support provider, Workbase, says although most New Zealand adults can read, write and use numbers, around half struggle with some of their everyday work tasks. “This is particularly an issue for the highly competitive logistics sector, which is driven by the need for accuracy, speed and cost control.”

Ms Percy says several logistics companies have said that their employees are good, keen workers, but they struggle to understand instructions, communicate effectively, and to be fast and accurate in their work. “This is a growing issue because many businesses are using new technologies to lower costs and drive efficiencies, yet they are not getting the most out of those investments because communication and literacy issues mean many employees struggle to understand, accept and use the new systems.”

She notes that employers often mistakenly assume that their people have basic numeracy skills, such as the ability to calculate proportions of items when an order involves an inexact number of boxes, and they believe that employees will speak up if they don’t understand an instruction. “People with literacy and numeracy issues often ‘don’t know what they don’t know’ so don’t ask for clarification or draw things to management’s attention,” Ms Percy says.

Workplace training

A range of options are available to employers who wish to help improve their workforce’s skills, including government-funded training in the workplace. Employers can also take steps such as improving written processes and standard operating procedures so they are easier to follow and become clearer about the literacy and numeracy skills needed for jobs.

Ms Percy says companies addressing their workforce’s literacy issues typically experience a winwin result for themselves and their employees. “Profitability goes up, employee morale and loyalty increase, and employees often report that the positive impacts flow into their personal lives because their newfound skills enable them to better engage in a range of activities that were previously unavailable to them.”

ProPharma’s experience

As New Zealand’s only national pharmaceuticals wholesaler and distributor, ProPharma handles over 2000 orders daily. Fulfilment accuracy drives the company’s ‘right first time’ philosophy because it is critical for meeting the market’s needs and for enabling ProPharma to manage costs. ProPharma manager, Anna Mickell, says many of ProPharma’s warehousing and distribution employees could read and write, but not well enough to enable them to complete more technical tasks. What’s more, they were not sufficiently confident in their language skills to take on roles involving communication or analysis.

These are common issues in New Zealand’s workforce, with research showing that around 50% of adults lack the literacy, numeracy and/or communication skills needed in today’s economy. Ms Mickell says ProPharma recognised the value to be gained from addressing its workforce’s skills because people needed to be able to analyse and improve processes that were not working properly by understanding what was required. They also needed to know how to figure out what needed to change, and then communicate that to a supervisor or other team workers.

“The logistics industry is introducing increasingly complex technology through automation and new systems to make processes more efficient. Yet employees won’t cope unless they have the necessary skills for implementing the changes, such as listening, speaking, problem solving and critical analysis,” she says.

Cornerstone of productivity

ProPharma recognised that literacy, numeracy and communication were the cornerstone for improving productivity because it was vital that employees could communicate effectively with each other. This was particularly relevant for its workforce, some of whom did not benefit from schooling in their childhood and/ or did not speak English as their first language.

ProPharma’s management realised that all of its employees needed to understand that communication styles that worked in our culture did not necessarily work for people from other cultures. As a result, the company introduced a workplace literacy and communication skills programme through Workbase.

The training, which was supported by government funding, helped people to understand and communicate effectively with employees from other cultures. Employees learned how to give and receive feedback and instructions appropriately, and understand and analyse information. They were also taught how to improve their customer service skills.

Steady improvement

The results have been impressive. Teams are more engaged in helping the company achieve its goals, and instructions are conveyed and understood better. Customer service has improved because representatives can communicate more effectively by phone and email. The company has also enjoyed steady improvement in all aspects of picking and stock-handling performance and accuracy.

ProPharma is not alone in benefiting from improving its workforce’s language, numeracy and literacy skills. Pumpkin Patch’s stock-counting times decreased by two days after employees were given maths skills refresher training. Snell Packaging and Safety’s picking accuracy increased by 74% after employees were given numeracy and communication skill training.

Ms Mickell says the literacy training has benefited the company and employees alike. “This training has had the biggest impact on our employees over the past year. It has spilled over into their personal lives and has also had a positive impact on their morale and loyalty to the company.”

For further information, or to see a range of job profiles, including ones for logistics coordinators, store keepers and truck drivers, visit www.workbase.org.nz