Documented processes and procedures are an important aspect of any successful distribution operation. Without process documentation, product gets shipped and not billed, customer orders and items get lost, and employees get upset. Distribution outfits need some form of step-by-step manuals, workflow diagrams, or digital instructions to ensure that operations run smoothly, consistently, and efficiently. However, creating and updating these documents has, historically, been time-consuming and resource-intensive.
Generative artificial intelligence (Gen AI)—a subset of AI that can create content, such as text, images, videos, and other media—can help. This cutting-edge technology has the potential to streamline the process of creating documented processes and procedures. As a result, it can become a cornerstone for companies looking to optimize their distribution operations, streamline training processes, and provide a superior customer experience. What once seemed like a distant futuristic possibility is now a crucial tool for the modern distribution industry.
The cornerstone of consistency
Documented procedures standardize operations across all levels of the distribution chain, from warehouse workers to managers. When employees follow clearly defined steps, consistency in task execution becomes a given. This is especially important in large distribution centers where employees might work on similar tasks but in different shifts. Standardization helps maintain a consistent level of quality, regardless of who is performing the job. This not only enhances operational efficiency but also minimizes errors.
In addition to providing consistency, documented processes and procedures have several other benefits such as streamlining training and onboarding, enhancing knowledge retention, improving performance evaluation, aiding in continuous improvement efforts, and ensuring compliance with industry regulations.
Training and onboarding:Training new employees is a critical phase in any organization, but even more so in the distribution sector, where complex logistics and time-sensitive processes are involved. Clear, documented procedures make it easier to onboard new staff, reducing the learning curve and ensuring they can contribute effectively in a shorter amount of time. These materials are a reliable resource for employees, allowing them to refer back whenever they are uncertain about the correct procedure for a task.
In the past, training often depended on experienced employees showing new hires the ropes, which can be time-consuming and inconsistent. Well-documented processes eliminate this dependency and ensure that training is uniform across the board, leading to faster, more efficient onboarding.
Knowledge retention: One of the biggest challenges many organizations face is the loss of knowledge when experienced employees leave. A robust system of documented procedures acts as an institutional memory, preserving critical knowledge and ensuring that valuable insights and practices are not lost when staff turnover occurs. This continuity is essential for maintaining long-term operational efficiency.
Performance evaluation and continuous improvement: Standardized, documented procedures allow for more objective performance evaluations. Managers can measure employee performance against clearly defined expectations, identifying areas of strength and opportunities for improvement. In addition, these documents serve as a foundation for continuous improvement efforts. By periodically reviewing and refining procedures, businesses can adapt to changing market conditions, adopt new technologies, and optimize workflows to stay competitive.
Compliance and auditing: In today’s regulatory environment, compliance is non-negotiable. Documented procedures are vital in ensuring that a company complies with industry regulations. When processes are clearly outlined and followed, it is easier to demonstrate adherence to safety standards, labor laws, and environmental regulations. This helps avoid costly fines and simplifies the auditing process, reducing the time and resources required for internal and external audits.
The perils of unclear instructions
When warehouses operate without clear, well-documented processes, they expose themselves to risks and inefficiencies. Unclear expectations create uncertainty, which can ripple across the entire operation. Here are some common examples:
Inconsistent performance and increased error rates: Employees may interpret tasks differently without standardized guidelines, leading to inconsistent performance. Variations in completing tasks can result in some excellent but many suboptimal outcomes. For instance, one employee may prioritize speed, while another focuses on accuracy. This inconsistency affects productivity and can lead to a higher error rate in order fulfillment, inventory management, or customer service.
Even small errors can have big consequences in a fast-paced warehouse environment. Incorrectly filled orders, damaged goods, or delayed shipments can damage customer relationships and result in financial losses.
Higher training costs and reduced productivity: When processes are not clearly defined, training new employees becomes more resource-intensive. Without a formalized training program supported by documented procedures, trainers often have to spend more time demonstrating tasks and correcting mistakes. This increases the cost of training and diverts experienced staff away from their regular duties, thus lowering overall productivity.
Customer dissatisfaction: Customer experience is a key differentiator in today’s competitive marketplace. Consistency in processes directly impacts how customers perceive a brand. A positive, uniform experience across multiple interactions strengthens brand identity and fosters loyalty. Customers are more likely to become repeat buyers when they know they can rely on the distributor to deliver on its promises, whether that’s order accuracy, speed of delivery, or responsiveness to inquiries.
Inconsistent service inevitably leads to customer dissatisfaction. Customers expect a reliable and uniform experience, especially regarding delivery times, product availability, and order accuracy. A lack of clear, repeatable processes can make it more likely for a company to fail to meet customer expectations, leading to complaints, returns, and, ultimately, loss of business.
Difficulty scaling operations: Scaling operations becomes increasingly difficult when there is no standardized playbook to follow. As distribution centers grow or a company expands to new locations, replicating success becomes challenging if processes are unclear.
Scalable, consistent processes also allow companies to grow their operations while maintaining the same level of service quality. This scalability becomes a significant competitive advantage in a sector where margins are thin and efficiency is paramount. By ensuring that processes are repeatable and effective, companies can focus on expanding their reach and entering new markets without sacrificing quality.
The potential role of Gen AI
Gen AI is a game changer for distribution operations that are looking to create, update, or optimize their process documentation. Gen AI can drastically reduce the time and effort required to develop comprehensive procedural guidelines by automating and enhancing the content creation process. (Figure 1 above lists the main benefits of using Gen AI to create process documentation and procedures.)
One of the most significant advantages of Gen AI is its ability to generate content quickly. Whether creating initial drafts of process documents or updating existing procedures, AI can handle these tasks in a fraction of the time it would take a human team. AI can also customize the content for specific roles, locations, or scenarios, ensuring the documentation is relevant and applicable to various operational segments.
Gen AI can create documentation in multiple formats, including text-based manuals, visual flowcharts, and instructional videos. This flexibility allows companies to create a variety of training materials that cater to different learning styles and ensures that employees can access information in the format that works best for them. Furthermore, as procedures evolve over time, AI can easily update these documents, keeping them current and aligned with the latest operational requirements.
Best practices and considerations
While the potential benefits of Gen AI are clear, successful implementation requires careful planning and strategic execution. The following are some key considerations that companies must keep in mind as they use Gen AI tools in real-world situations:
Human oversight: AI-generated content should not replace human expertise but rather complement it. Subject matter experts must review AI-generated documents to ensure their accuracy and relevance.
Data quality: AI systems need access to high-quality data to be effective, so ensuring that your organization’s operational data is up-to-date is critical.
Ethical considerations: As with any AI system, ethical considerations must be taken into account, particularly regarding potential biases in the content.
Employee training: Companies must also invest in training their employees to use AI tools effectively, ensuring that they can access and apply the information generated by AI systems.
Security and privacy: As AI systems rely on sensitive operational data, robust security measures are necessary to protect this information.
Change management: Introducing AI significantly changes how employees access and use procedural documentation. Clear communication and training are essential to ensure smooth adoption and to help employees see AI as a tool that enhances their work rather than a threat to their jobs.
Embracing the future of distribution
The distribution sector is on the brink of a significant transformation in today's fast-paced, ever-evolving business landscape. The driving force behind this change is the rise of artificial intelligence and, more specifically, generative AI.
It’s important to realize that Gen AI is not just a tool for the future—it is a tool that can already be used today to improve distribution processes. Companies can create more consistent, efficient, and scalable operations by embracing this technology. AI is poised to revolutionize how companies document and update their distribution processes, which in turn can streamline training and onboarding and improve customer satisfaction and operational efficiency.
As the industry moves forward, those who integrate Gen AI into their operations will be better positioned to meet the demands of a dynamic marketplace. The future of distribution lies in the partnership between human expertise and AI, creating a synergy that drives innovation and sets a new standard for excellence in the field.About the author: Steve Levy is the vice president of Enterprise Architecture for the distribution industry at Infor. Before joining Infor, he honed his skills and expertise working in the distribution industry and was the executive vice president at a wholesale paper distributor.
