Order online, and you can get nearly anything delivered to your door within two days. That we take this outcome for granted is the result of the behind-the-scenes technology used for warehousing and logistics today.
As our expectations for e-commerce have expanded, the time allowed for delivery has shrunk from days to hours or even minutes. For those in the industry, that translates into a sustained surge for Warehouse Management Systems (WMS) and a need to plan for optimized integration.
According to ABI Research, worldwide WMS market revenues will have a Compounded Annual Growth Rate (CAGR) of over 23% from 2021 to 2030, bringing total revenue above the US$10 billion mark by 2030. That means it would have quadrupled from the $2.5 billion it was at in 2020. Managing warehouses at the level of efficiency required to meet increasing retail demands requires a system of smart, integrated solutions.
A warehouse managment system not only supports warehouse workers in performing the many processes involved in receiving and shipping out goods; it also helps direct and validate each step, capturing and recording all inventory movement and status changes to the data file. It takes more than one form of hardware and software to pull that all together efficiently.
“Productivity technologies can achieve far greater return on investment if combined correctly with other technologies. For example, by combining location tracking data with a voice solution, warehouses using a WMS can optimize workflows by minimizing distance traveled based on a worker’s whereabouts,” explained Adhish Luitel, Industry Analyst, Supply Chain Management and Logistics at ABI Research.
What Is a Warehouse Management System?
A warehouse management system is a type of software that provides a holistic view of a warehouse’s resources and allows workers to manage those resources in an optimal way. Everything from inventory management to order receiving can be automated with a WMS. There are three types of WMSs, as follows:
Standalone System: Mainly deployed for managing warehouse operations and nothing more. Users can expect features like expiration date tracking, barcode scanning, cycle counting, slotting, putaway, receiving, picking, packing, and shipping.
Supply Chain Modules: Takes a broader approach that supports end-to-end supply chain operations. For example, vendor relationships and risk assessment can be managed, in addition to warehouse tasks like inventory management.
Integrated with ERP: Integrating a WMS with an Enterprise Resource Planning (ERP) platform is a great way to promote an in-sync system. The integration allows for warehouse management processes to work alongside other business processes, such as sales, customer service, finance, etc.
Trends that Warehouse Managers Must Pay Attention to
There is not a single logistical solution but a suite of complementary tools that can work together to achieve the efficiencies promised by automated inventory management. “Companies are starting to combine the value of multiple hardware and software solutions,” Luitel, noted.
However, he warned that the combination that makes up the overall solution strategy needs to be carefully thought out: “Vendors should be ensuring that they have a well-developed partner network and integration strategy relating to complementary technologies.”
Luitel identified four forms of technology currently being applied in the WMS market:
- Advanced Data Analytics: Operators can now deploy Machine Learning (ML) algorithms that offer insights in real time to optimize logistics based on what is happening now.
- Blockchain: the immutable, distributed ledger improves transparency and will enable supply chains to become more connected, accountable, and visible.
- Robotic Automation: The combination of robotics, Artificial Intelligence (AI), and ML makes it possible to speed up placing or retrieving items at a warehouse and getting them out as quickly as possible.
- Enhanced Integration in Warehouse Robotics: AI capabilities, software platforms, web apps, Robotic Operating Systems (ROSs), and Warehouse Controls Systems (WCS) plus WMS integration all contribute to successful robotics implementation.
Vendors that develop solutions that integrate well with various levels of automated processes and technologies are most likely to achieve long-term success. One of the signs of the growing maturity of the WMS market is that an array of leading vendors, including names like Manhattan Associates, Oracle NetSuite, Blue Yonder, Ehrhardt Partner Group (EPG), and Mantis, offer compelling end-to-end solutions.real-time
Here’s What Warehouse Operators Should Do
Dock-to-stock time, inventory accuracy, worker distance traveled, error rate, and order picking accuracy are obviously important Key Performance Indicators (KPIs) for warehouse operators to track when gauging the effectiveness of warehouse automation. However, it shouldn’t stop with quantitated metrics; qualitative data like worker satisfaction, safety, energy levels, and comfort are also important factors to consider.
In addition to providing workers with technologies for tracking inventory, it’s also time to think about automated inventory solutions. Not only will automated inventory cut down labor costs, but it’s also more accurate than manual forecasting. Automation takes the guessing game out of the equation.
Logistics personnel should choose a digitization strategy that works best for their own particular needs. A warehouse that’s focused on high shipment volumes will have different expectations than a warehouse more concerned with flexibility. Not all warehouse automation deployments are created equal, meaning warehouses that care mostly about high throughput will benefit the greatest from heavy automation in the shortest time span.
Case Study: DHL Supply Chain
DHL Supply Chain is one of the world leaders among independent Third-Party Logistics (3PL) providers. DHL’s customers are accustomed to benchmark turnaround times, thanks in part to its existing Blue Yonder WMS. But to take things up a notch, the company decided to deploy warehouse automation and robotics to more than 2,000 sites worldwide.
By teaming up with Blue Yonder, DHL was able to introduce a cloud-based “plug-and-play” solution that makes the process of onboarding a new device to a warehouse much easier. This new and improved warehouse management system enabled DHL customers to pick and choose robotic systems that were the best choice for their business. On top of that, DHL employees were then able to access a single, shared dashboard for robotics, allowing them to track warehouse progress instantly, check the status of important tasks, and send work-order updates to the WMS in real time.
Blue Yonder’s WMS also leveraged AI to help carry out logistical tasks done by associates and the robotics solution. The greater speed, responsiveness, and resilience provided by the WMS resulted in a 60% reduction in the time to implement robotics and an 80% savings in time to train employees with the new technologies.
A Must-Have Investment
A warehouse management system can be thought of as the missing piece to the supply chain puzzle. It’s more important than ever to gain full transparency on every aspect of logistics operations as real-time warehouse analytics can be converted into business-bettering action. As WMSs automate many of the day-to-day activities, employees can spend more time on critical functions, and a warehouse can significantly expand its potential.
These findings are from ABI Research’s Warehouse Management Systems Software analysis report.