New Trends in Warehouse Management

As the complexity of filling smaller orders faster continues to mount, our analysts
expect more operations to embrace the value that WMS brings to the table.
Here’s what they believe is on tap this year in the world of WMS and the systems that support it.

To hear the typical logistics manager tell it, there are few areas of their warehouses and DCs that aren’t in need of an upgrade right now. Challenged by the demands of e-commerce and omnichannel fulfillment, smaller orders, ever-shrinking delivery time frames, and a persistent labour shortage, operations are in perpetual need of tools that can help them tackle these and other ongoing productivity issues.

Technology is providing at least some relief. With automation, robotics, artificial intelligence (AI) and other advanced technologies making their way into the world’s distribution facilities, the warehouse management system (WMS) is one stalwart that’s long served as a cornerstone for most distribution operations.

Acting as traffic cops of sorts, these software systems provide inventory visibility, manage supply chain operations, and integrate with transportation management systems (TMS) and other solutions, to help streamline the movement of goods from manufacturer to warehouse to retailer – or eventually the end customer. The WMS does this by overseeing receiving, put away, order picking, shipping, and inventory counts, among other activities. And because it collects valuable information along the way, WMS also provides actionable data analytics that companies can use for good decision making.

But, even for all of the benefits that WMS is known to provide, the software’s adoption rate is hanging at about 70 percent, according to a 2018 WERC survey. Joe Vernon, Senior Manager of Supply Chain Technology for consulting firm Capgemini, says that he was stunned that one-third of shippers aren’t using WMS in their operations: “You would think that, by now, WMS would be omnipresent.”

According to the WERC report, adoption rates tend to be highest among high-volume shippers that are being pressured to ‘quick ship’ in the Amazon-led online retail world. “These companies have to respond, and they have to be able to do things quickly and accurately,” says Vernon, “because that’s what the end consumer expects.”

Our group of leading supply chain software analysts see six key trends dominating the warehouse management landscape. Here’s what logistics operations can expect:

Systems that use machine learning to sense and adapt

Even though WMS has been around for decades, that hasn’t stopped its makers from coming up with new and useful software capabilities to meet their customers’ current needs. Right now, for example, Vernon says that vendors like Manhattan are using advanced technologies to enhance their core offerings. They’re adding more algorithms into the capabilities of their WMS,” says Vernon. “For example, Manhattan’s order-streaming now incorporates machine learning that helps shippers sense and adapt to changing conditions within the warehouse.” In other words, if a picking process that’s underway suddenly shifts over to a batch of difficult-to-pick items, then the system can shift allocation accordingly, and without human intervention.

Systems that can interject last-minute orders

For last year’s ARC Advisory Group WMS survey, Clint Reiser, Research Analyst, dug into the degree at which shippers were using intelligent waving/batch picking. Common across most of the advanced WMS offerings, this capability is less used by the 30 percent of companies that have “less sophisticated, complex warehouses that are still using onesie-twosie, paper printout, ad-hoc processes,” says Reiser.

As the use of wave-less fulfillment gains momentum in the fast-paced e-commerce space, Reiser says he’s seeing more companies turn to warehouse control systems (WCS) and automation to help support those activities. “These systems allow companies to interject rush orders in the midst of pushing out a wave,” says Reiser.

WMS vendors working with their OEMs to ‘democratise automation

Cloud computing may have completely changed the way companies purchase most of their software, from on-premise license purchases to subscription fees, but Vernon says that he’s now seeing even more creative financing opportunities surface for companies that want to infuse new technology into their warehouses. “Shippers that are trying to automate, or that are investing in robotics, self-guided vehicles and other technology, are working with their vendors to come up with creative financing options,” says Vernon. He says, for example, that one school of thought that more companies are adopting is that assets can be ‘rented’ versus purchased or leased. In other instances, the WMS vendors that sell the systems that run the automated equipment are now working more closely with their OEMs to help make it more affordable for a wider swath of customers.

A big focus on WMS user interface

Logistics managers don’t have the time to sift through reams of data to find what they’re looking for, nor do they want to waste their time determining which information nuggets are ‘actionable’ and which of them can be ignored. To help, Dwight Klappich, Research VP at Gartner, says WMS vendors are focusing on their user interfaces and coming up with ways to present data in a more logical format to users. “It’s about packaging and representing information for, say, the supervisory workforce,” says Klappich. “There are now some other WMS vendors who are asking themselves: “How do we enable the warehouse, picking or packing area managers and help them do a better job? The focus is on making systems more engaging and easier to use, and particularly in a same-day-shipping environment, where a field service technician or retail clerk can use the system with literally zero training.”

Better, faster return-to-inventory management

Today’s consumer has no tolerance for late, missing, or incorrect orders. They also don’t think twice about returning merchandise purchased online and asking for a replacement (or refund). These ‘new realities’ have made a sizable impact on the distribution environment and are pushing technology vendors to add better precision management capabilities into their systems.

 

“Companies have to be able to manage precision, while more economically managing individual items,” says IDC Manufacturing Insights’ Program, VP Simon Ellis. On the returns front, for example, more companies are rushing to put the right business processes in place to deal with these different kinds of returns (i.e., those that can be returned to inventory and sold). That’s where WMS is stepping in to help. “At the end of the day,” adds Ellis, “WMS is an inventory system. So, while these systems certainly help companies pick, pack, and stage, they are also inventory systems. As items get returned, shippers need to be able to return those goods to inventory. The WMS needs to be able to handle that task as well.”

Better, faster return-to-inventory management

On the implementation side of WMS, Klappich says that more vendors are waking up to the fact that they possess the internal technical expertise to start building system functionality that makes implementations better, faster and easier.In a perfect world – for example, instead of users manually keying data into their WMS platforms, they will use vendor-created wizards and coaching-tools to copy templates and then replicate that process across additional warehouses. “WMS already offers a lot of features and functions, so now vendors are taking deeper dives into what else they can be doing,” says Klappich. “There’s still a lot of opportunity there.”

Based on an article by Bridget McCrea, courtesy Logistics Management

 

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