Warehouse Management and the Mobile Supply Chain

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Content Copyright © 2015 Bloor. All Rights Reserved.
Also posted on: The Holloway Angle

It is interesting to see that this month has seen 2 white papers issued on the subject of warehouse management. The first was from Zebra that I spotted in an article in LogisticHandling.com. The opening statement of the article really caught my attention: “The role of the warehouse is changing. No longer just a big space to store inventory, today’s warehouse operation is fast-paced and often decentralised. Inventory turns faster than ever as retailers and manufacturers try to keep up with consumer expectations in this ‘need it now’ culture. To compete in this dynamic environment, today’s warehouse needs to be proactive and responsive, not to mention accurate – anything less than perfection in order fulfillment can result in a lost customer.”

Zebra Technologies are a well-known and major supplier of RFID tags, readers and associated services. Although this white paper (Solution Brief: Create a lean real-time warehouse to drive productivity up and errors down), is a sales tool to promote Zebra’s products and services, it makes some very important and valid points. The role of the warehouse is very definitely changing as it is no longer just a big space to store inventory, instead warehouse operations are fast-paced and often decentralised. Consumer expectation now operates on a “need it now” basis, which means that inventory turns over faster than ever as retailers and manufacturers try to keep up. Couple this with the need to access multiple channels from retail, catalogue, call-centre to internet and we are in a real Mobile Supply Chain world (please refer to recent Bloor market research report on the Mobile Supply Chain). This means that today’s warehouse must be proactive and responsive. Manufacturers need visibility into the entire supply chain whether products are in the warehouse, in transit or in a factory anywhere in the world. Zebra’s proposition is that what is needed is “mobile warehouse power”; exactly the point I make in the Bloor Market research paper on Mobile SCM, except I have extended it across all areas of the supply chain process. That given, I would recommend this white paper as a good read about how real mobility support provides improvement to business processes involved in WMS and the benefits that can be obtained.

The second white paper (The Ultimate Decision: Traditional ERP vs Next Generation WMS) is from SCM supplier IBS who provide solutions particularly in Airline, Oils and Gas sectors. This white paper is like Zebra’s in being another sales-oriented one and is concerned with providing tips on why you should choose a WMS over just sticking with what is provided by an ERP package. The paper starts with a very true statement; “Few supply chain decisions impact your company’s day-to-day business, financial health, and customer relations more than selecting and implementing a warehouse management system (WMS).” There are some good comments about the process of making a choice, which are very informative; showing the positions that CFO’s, COO’s and IT managers might take. What the paper suggests is what areas should be evaluated in making the choice. It suggests looking at Functionality, Flexibility, Technology and finally Value. It then goes to look in detail at the following 8 points:

  1. Which company strategy needs supporting by the system?
  2. What does your overall cost look like?
  3. Does the solution have sufficient functionalities to meet your strategic goals?
  4. How well does your software provider know the supply chain industry?
  5. Could you build a partner relationship with the supplier?
  6. Do you have the right technical tools at hand?
  7. How was the solution built and how did it evolve?
  8. Are you being supported by a professional team during implementation?

All of these points are what we at Bloor use when we evaluate software when making a market report and what we would advocate to any of our clients who are in the process of selecting software. The paper ends with the following conclusion points:

  • Does the solution maximise business results?
  • Does the functionality comply with the set KPI goals?

What it also recommends is that during the selection process you should:

  • Define your requirements with attention to the future, not just the here and now.
  • Evaluate all options against the same criteria and compare results.
  • Ask the vendor to demonstrate the actual capacities of the solution.

This is an excellent paper for anyone to read who is making the choice about WMS packages, but it contains advice which goes across all application software selection.

Having read these two white papers I thought that would be it, but then today I received  my weekly update of news from The Retail Technology Review and its lead article immediately captured my eye – “UK Retailers are not well prepared for key shipping challenges this Christmas, says Temando survey”. Well, time of year plus what I had just read on WMS made me want to look further. Thoughts sprang into my mind of households without their Christmas fayre and of presents ordered but unable to be delivered by Christmas. So I went to look at the overview of the survey in the article. Temando are a leading shipping and fulfilment software platform for commerce. The research, which was carried out for Temando by Research Now amongst the UK’s micro, small, mid-size and enterprise retailers, explored specific areas of customer concern in October 2015 and found that:

  • 77 percent weren’t well prepared to offer customers multiple shipping options during the checkout process on their websites, such as express and same day delivery;
  • 76 percent weren’t well prepared to handle potential shipping delays;
  • 75 percent weren’t well prepared to handle their return processes;
  • 79 percent weren’t well prepared in terms of back-end logistics such as pick and pack, labelling, documentation and transfer to carriers. 

The survey found that many retailers’ back-end shipping processes are not totally automated. Retailers responded that their systems for warehouse management (2/3rd), booking a courier (2/3rd), customer product returns (3/4) and delivery tracking and customer communication (2/3rd) were either manual or only somewhat automated. The study found a possible correlation between a retailer’s size and their ability to meet customer expectations in the lead up to Christmas with more than three times as many enterprise-sized retailers citing ‘incompatible technology platforms’ as a barrier to smooth customer order fulfilment than micro retailers. Now isn’t that interesting, sounds like an integration problem between systems running different parts of their supply chain!