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.
Streamlined Operation
One Dove Tree customer saved time and improved customer satisfaction when it implemented a WCS, eliminating the need for scraps of paper and pencils.
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.
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.
The pay-offs
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.
It's one of those cases -- and there are many, aren't there? -- where a company has to look beyond the upfront costs and consider the benefits over the course of one, two, three, five years. When you do that, then it's easy to see the ROI. Most times the best advocates really are existing customers, those that have taken the plunge and purchased the system. You can see why developers often give early adopters a heavily discounted or free solution in order to create these advocate-clients.
The initial investment might put some companies off, but like you said, the payoff is huge. The convenience it offers and the increased customer satisfaction makes it more than worth it, IMO.
Well, you can squish paper and pencil into a pocket without worrying about scratching the screen. You're carrying your phone anyway, so I can understand why a smartphone-based solution might be preferable for management.
Although some of these investments can be high - Woo mentioned $2M- the payoff can be large, given the costs associated with acquiring new customers and losing existing clients. You'd imagine managers would like this type of technology, too, since it means they spend less time walking back and forth from warehouse floor to office desk.
It is a clear winner for logistics in general. I love that I can track online orders to my door via most delivery companies. It is a win win for comsumers & retailers alike
The ThinkerNet does not reflect the views of TechWeb. The ThinkerNet is an informal means of communication to members and visitors of the Internet Evolution site. Individual authors are chosen by Internet Evolution to blog. Neither Internet Evolution nor TechWeb assume responsibility for comments, claims, or opinions made by authors and ThinkerNet bloggers. They are no substitute for your own research and should not be relied upon for trading or any other purpose.
Almost everyone agrees that data analytics, digital marketing, apps, and APIs will greatly affect their enterprise's results in the next 12 months. But a report suggests that not all large corporations are moving quickly to adopt these enabling technologies -- and that could seriously harm their profitability, customer satisfaction, and chances for ongoing success.
Enterprises are embracing open-source to avoid vendor lock-in, get better-quality software, and gain access to larger libraries of applications. In return, they may be putting themselves at risk for higher, more complex support costs.
Whereas some businesses search externally when they need a CIO, Choice Hotels had to look only at its CTO for someone with the necessary expertise, industry knowledge, and technological know-how to continue leading the company's embrace of enabling technologies.
Local social media can be powerful marketing tools, but they can't just be add-ons. They need to be tightly integrated into the corporate culture, according to Whole Foods social marketers.
A survey by JD Powers found that customer interest in product features is lessening as phones evolve. Rather than features, price is driving purchases, and that change could have a dramatic impact on how IT departments secure these devices.
Cisco's rumored sale of Linksys suggests we may have problem with innovation and profit at the edge of our Internet, and that could be critical to the evolution of many Internet-delivered services.
The bring-your-own-device approach isn’t suited to monitoring of enterprise equipment and processes. In these cases, it is up to IT to come forward with gear suited to the task.
The decision could discourage innovators looking to the past, and require companies to build from the ground up, leading to a new generation of stagnation in the IT world.
Companies used to be confident they'd know exactly what a cellular OS would look like out of the box. Today, that confidence should be fading. Reiter discusses how a cellphone OS's looks could be deceiving, and why businesses need to understand it.
Cellular operators, netbook manufacturers, and, of course, techies, have been eagerly awaiting a hands-on experience with Nokia's new netbook, the Booklet 3G. Reiter's got his hands on one, and tells you whether it's worth the wait.
New York's Metropolitan Transit Authority is conducting a pilot test of digital kiosks to guide subway users to where they want to go more efficiently and at lower cost.
New York's Metropolitan Transit Authority is conducting a pilot test of digital kiosks to guide subway users to where they want to go more efficiently and at lower cost.
The whole Amazon.reader debate is a double-stupid. It's stupid to think that there's any e-book buyer who doesn't know Amazon's URL, and it was stupider to let ICANN launch the whole free-form TLD initiative to start with.
While NFC's original goal was to enhance mobile commerce applications, it is finding its way into a number of other uses, which is creating both opportunity as well as challenges for IT departments.
Enterprises would like to move to cloud computing but are hesitant because they are concerned about providers’ ability to secure company data. Here are some tips that help to ensure that if breaches occur, the business is not left holding the bag.
Edmunds separates customers into segments based on the info it collects on its site and from partners, and uses that to push out custom content, said Brian Baron, director of business analytics for Edmunds.com, at Predictive Analytics Innovation Summit.
The automotive website uses propensity modeling to target ads and customer registration forms, said Brian Baron, director of business analytics for Edmunds.com, at Predictive Analytics Innovation Summit.
Expert Integrated Systems: Changing the Experience & Economics of IT In this e-book, we take an in-depth look at these expert integrated systems -- what they are, how they work, and how they have the potential to help CIOs achieve dramatic savings while restoring IT's role as business innovator. READ THIS eBOOK
your weekly update of news, analysis, and
opinion from Internet Evolution - FREE! REGISTER HERE
Wanted! Site Moderators Internet Evolution is looking for a handful of readers to help moderate the message boards on our site – as well as engaging in high-IQ conversation with the industry mavens on our thinkerNet blogosphere. The job comes with various perks, bags of kudos, and GIANT bragging rights. Interested?
To save this item to your list of favorite Internet Evolution content so you can find it later in your Profile page, click the "Save It" button next to the item.
M2M: Rise of the Machines? Not Yet David Weldon In the 1970 science fiction thriller Colossus: The Forbin Project, two giant supercomputers from the United States and Soviet Union secretly join forces to take control of the collective nuclear might of the two countries. In the film, the two machines discover each other's existence, communicate back-and-forth, share their collective data, and cut their human creators out of the process. It is the ultimate example of machine-to-machine communications, or M2M. CLICK FOR MORE
M2M: Rise of the Machines? Not Yet David Weldon In the 1970 science fiction thriller Colossus: The Forbin Project, two giant supercomputers from the United States and Soviet Union secretly join forces to take control of the collective nuclear might of the two countries. In the film, the two machines discover each other's existence, communicate back-and-forth, share their collective data, and cut their human creators out of the process. It is the ultimate example of machine-to-machine communications, or M2M. CLICK FOR MORE
Email This
