Mobile technologies are helping logistics companies cut spending, improve productivity, and improve customer service by giving warehouse executives real-time insight into shipments, quality of goods, and an array of key performance indicators that allow them to speedily and accurately deliver inventory to its final destination.
Smartphones running warehouse control system (WCS) software often replace a scrap of paper and pencil, and alleviate managers' need to dash between the warehouse floor and the office where a computer is located, Bill Woo, president of WCS developer Dove Tree Canyon Software, told me in an interview.
They're carrying, literally, a piece of paper or clipboard, and they're meandering through the warehouse. We find the tablets are unwieldy for them to be using, especially a tablet that's a 7-inch or up. The person doesn't want to carry them around because they need to use both hands to do their job. In a warehouse, the warehouse managers, the way they work is they usually only have a pencil in their hand; they'll rip a flap off the cardboard box and start writing on it. Then they'll go back to the computer.
Yet, a mere 30 percent of companies use WCS to manage real-time information and control inventory, according to Modern magazine's 2012 Software Usage Survey, conducted by Peerless Research Group (PRG). That's up only 2 percent from 2011, the poll found, although 23 percent said they plan to research and potentially buy a WCS solution, with 30 percent expecting to act within six months, and the majority planning to do so within six months to two years.
When companies plan to adopt a WCS, 43 percent said they'll upgrade an existing system, while 57 percent expect to buy a new solution. About one-third will purchase stand-alone systems, while most expect the WCS to be one component of a larger automation initiative, the survey found.
One Dove Tree customer saved time and improved customer satisfaction when it implemented a WCS, eliminating the need for scraps of paper and pencils.
It's surprising, though, that such a small percentage of warehouse operators have implemented solutions that, the survey found, deliver a return on investment in 12.6 months. Given that the average age of installed WCS systems is almost seven years old, with upgrades 2.7 years ago, you can imagine the additional capabilities now available to these solutions with all the technological advances made in the past 36 months. Just think of the steps we've made in sensors and geo-location alone, and it's easy to see why reconsidering an old WCS could make sound business sense.
Even midsized companies' warehouses can be huge, with acres of boxes and forklifts in well-organized rows. Requiring people such as the Vice President of Distribution or the warehouse manager to expend what adds up to unproductive hours each week, walking back and forth between stacks of inventory and the office, is immediately eliminated by smartphone-based WCS applications.
Perhaps more importantly, Woo said, WCS gives executives immediate, real-time visibility into the status of inventory to ensure orders are shipped on time. This eliminates costly overnight or second-day shipping due to distributor error, which is typically borne by the distributor itself.
Using customizable metrics, executives can make sure that, for example, 75 percent of all orders are out the door by 3:00 p.m., said Woo. Managers can find bottlenecks or resolve problems early if they see that the warehouse has not met its goal of zero cycle counts by 8:00 a.m:
The distribution centers we work with today are very concerned about customer retention. If the goal is to lower overnight shipping costs by finishing 30 minutes earlier, or whatever it's going to end up being, they can monitor those numbers and hit the target. Just think of it as a traffic cop: Dove Tree plays in the arena of being a traffic cop.
On-time shipping of exactly what they wanted is probably the best way to keep customers coming back. Dove Tree's solution also snaps a quick photo of each box right before it's sealed to further ensure quality. If a customer has a problem with an order and claims a product was damaged or missing, the local sales representative can access the picture on his or her smartphone and, using that data, decide whether to refund the money, replace the item, or even drop the client if there are repeated and unwarranted claims, said Woo.
When Dove Tree works with clients -- including Duke Medical Center, Federal Express, Kaiser Permanente, and Yamaha -- the company typically partners with executives who have authority to approve budgets of up to $2 million. Implementations involve both warehouse and IT professionals, since the WCS must integrate with other applications:
The IT department is involved in these conversations always, because we have to interface to their systems. We sometimes have to fight the fight of turf protection. When the IT department comes in, they immediately consider a company like Dove Tree as a company that's trying to encroach on their turf. We have to explain we're looking to enhance their warehouse operations, not take over. We'll deploy a mobile app in the warehouse using an iPhone or Android [but] everything's done on the server. It's very straightforward.
As margins get squeezed further, and as mobile technologies become even more sophisticated yet user-friendly, more distributors will no doubt stock up on WCS amid the promises this technology may deliver.
— Alison Diana , ThinkerNet Editor, Internet Evolution