Warehouse of the Future: Adopting Automation within Your Supply Chain – Part 1 of 2

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There’s currently a digital supply chain transformation that’s happening faster than the physical supply chain can react, requiring hybrid solutions in semi-automated environments where humans and robots work in tandem. New incentives to modernize operational capabilities should be added that capture efficiencies not previously achieved, while laying the foundation of a digitalized supply chain, continuously re-evaluating plans and evolving for performance.

Automation has been looked at as a solution to operational challenges, but trends in the marketplace signify an unprecedented rate of adoption taking hold in the coming decade. E-commerce is driving service expectations to levels that may not be achieved without the use of highspeed picking alternatives to manual operations. The aging generations in mature economies and challenges securing a loyal millennial workforce for repetitive tasks are creating increased disruption to staffing, forcing employers to look to automation to offset risk of labor shortages. Continued innovation has reduced costs of entry for automated capabilities, delivering improved business case justification for automation of many forms.

With such a strong justification, operations leaders across the globe are seeking ways to capture the potential that automation offers. Large scale transformation of distribution networks is capital intensive, however, and rarely warranted given the pace of change – however rapid – and market uncertainties. Therefore, we’re forced to look within existing environments to identify opportunities to introduce automation into existing facilities, combining automated equipment with manual operations, which requires the added complexity of orchestrating work across semiautomated operations. This scenario introduces the question of how to create an optimal environment allowing warehouse management systems (WMS) to orchestrate work across manual and automated areas to ensure efficient operations and maintain quality and service levels.

Part 1 of this 2-part blog series will take a deeper dive into today’s automation systems landscape and retrofitting today’s supply chain with automation. Part 2 of the series will cover disruptive technologies and digitalization and next generation capabilities.

The Current Landscape of Automation Systems

In automated environments, WMS often work alongside warehouse control systems (WCS) that manage the routing of containers as they traverse the material handling equipment, and warehouse execution systems (WES) which often have basic task management capabilities but not the level of control or optimization of a WMS. Below are a few general groupings of automation that typically leverage these entities in different ways.

  • Conveyors and sortation equipment receive destination / routing information from the WMS and leverage the WCS to divert containers to the appropriate location.
  • Pick execution equipment, including pick-to-light, carousels, or A-frames will receive pick instructions from the WMS and rely on the WCS to control the MHE. At times, these devices will manage task distribution and user interfaces for the performance of picks, though often, the WMS will manage the tasks through prioritization, and provide a common user experience (using consistent equipment where appropriate) for work performed in the pick modules and in bulk storage which feeds it (this work would include putaways, cycle counting, and picks where appropriate). Often, a WES has been sufficient for high volume outbound operations in retail, but with increasing emphasis on service levels, the advanced functionality of a WMS specific to inventory accuracy, pick module replenishment, cross-docking, and exception handling, the WMS brings a strong justification for a two-pronged approach.
  • Automated guided vehicles (AGVs) and automated storage and retrieval systems (ASRS) are well established, though adoption is increasing as more forklift providers offer driverless units. These units can take direction from a WMS (typical when involved in semi-automated environments) or WES (often used in ASRS racking systems where materials are commingled or when the vehicles can follow multiple routes to alleviate congestion). In either scenario, a WMS is often utilized to manage inventory allocation to customer and order.
  • Palletizers use visual determination for pallet building capabilities, but most in use require some level of consistency in product dimensions at the layer level. Advanced pallet building and robotic arm picking capabilities are increasing in use, but require some consistency in dimensions. Improvements in digital sensing will soon be changing the game here.

Retrofitting Today’s Supply Chain with Automation

Automation adoption will continue to accelerate in response to advanced service level expectations and e-commerce, with a focus on scale and speed, whereas a continued migration of margin focused businesses will drive adoption of driverless vehicles and high-density storage modules, especially in cold storage or mega-cities with high volume real estate. The introduction of automation into the existing facilities will bring challenges, such as:

  • Traditional footprints, system capabilities, and business processes will be challenged when faced with the introduction of conveyance, sortation, and pick execution equipment. A natural inclination to delineate businesses, and potentially create channel-specific operations, can result in artificially inflated inventory levels and/or reduced service levels in increasingly sensitive environments to failures in this area. Multi-channel capabilities can be achieved, often driving operational leaders to adopt pick execution capabilities to distribute work without recognizing the backlash to overall service levels of having disparate capabilities with traditional WMS controlled processes. The results, if not thought through, can have repercussions on inventory accuracy, exception management, and operational efficiency.
  • The introduction of driverless vehicles (AGV or ASRS) offer strong advantages in terms of scale and cost, ROI projections in union environments can often deliver break even points less than a year after go-live, even in new projects. However, legacy storage equipment and material flow can introduce limitations. The environments best prepared for the introduction of driverless forklifts are those managing full pallets in bulk locations (where dimensions are predictable and stack requirements are well documented), or those where racking capacity is capable of managing fixed locations that can be tracked in the WMS (if locations can be dedicated to a specific lot), or in the WCS (where multiple pallet locations can be managed by the WCS but the WMS can manage storage/allocation in concert with non-automated areas). In more complex operations, the WCS can take a more active role in determining work and allocation, but this often drives customization and redundancy with WMS functions specific to the needs of the business.
  • More robust, piece level management in advanced pick modules controlled by ASRS such as goods-to-person automation, offer advanced capabilities for high volume distributors and e-tailers. Often, this will require tote storage of product to standardize the storage capabilities, though concessions for non-conveyables must be considered. Integrating pick and pack operations with traditional areas of the same operation also force decisions on how to integrate inventory management with shipping capabilities, adding complexity to projects as WMS and WCS providers offer similar capabilities.

Check back for part-2 of the blog series, where we’ll go into more detail around the technologies driving next generation warehouse automation and digitalization and next generation capabilities.

For more information download the Future Series white paper, “Adopting automation in the digital age.”

About the Author

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Matthew Butler, Industry Strategies Director, JDA Software

More more information contact, 0414 966 232.

Visit www.jda.com

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Building the Business Case for Digital Transformation of Supply Chain Planning

It seems like the phrase “digital transformation” is everywhere these days. There are as many definitions for digital transformation and articles on the subject. I like the definition provided in i-scoop’s online guide to digital transformation.

“Digital transformation is the profound transformation of business and organisational activities, processes, competencies and models to fully leverage the changes and opportunities of a mix of digital technologies and their accelerating impact across society in a strategic and prioritised way, with present and future shifts in mind.”

The digitisation of a supply chain involves creating a detailed data model that mirrors the intricacies of an actual end-to-end supply chain network. (Learn more in Technology Evaluation Center’s report, The Impact of Digital Transformation on the Supply Chain.) Done right, a digital twin will have enough detail to model the information, money, and product flow from acquisition of components, through production, distribution and fulfilment to the customer. Model element include forecasts, capacities, inventory positions, lead-times, resource availability, costs, revenues, and profits. Finally, the model needs constant updates of customer, production, purchase, and distribution order status to ensure analysis and resulting actions reflect what is currently happening in the physical supply chain.

The benefits of digital transformation are plentiful. Below are three tangible benefits of digitally transforming your supply chain:

Process Automation:

A very visible benefit of building a digital twin of your supply chain is the ability to use the information to automate routine process steps and free up resources to work on more value-added activities. Advanced supply chain systems have exception-based workflow and active alerts that when used in conjunction with user-defined limits can automatically process purchase, manufacturing, distribution and customer orders. Human intervention only takes place when plans, transactions, orders, etc. fall outside of defined limits.

Continuous Planning & Optimal Response:

Digitization of the supply chain unleashes the full capabilities of today’s powerful supply chain solutions leading to game changing competitive breakthroughs in customer service and value creation. One such capability is the application of algorithmic optimization in the areas of demand, inventory, supply, manufacturing, and transportation planning. The rich supply chain data available through a digital twin provides the foundation and inputs required for effective algorithmic optimization.

Another advanced supply chain capability is continuous planning. A supply chain digital twin contains up-to-date information on capacities and transactions. As new events take place (for example a new customer order, or a delayed replenishment) a planner can quickly determine an optimal response. Continuous planning and optimal response capabilities often lead to reduction in costs (manufacturing, inventory, transportation) and improvements in customer service (fill-rates, cycle-times).

Advanced Analytics:

Often the largest benefits from digitizing the supply chain come from new insights gained from the ability to conduct in-depth end-to-end analysis. The ability to analyze expected demand versus capacitated supply and determine financial impacts of multiple “what-if” scenarios provides the information needed to head off potential risks and fully embrace opportunities. A digital twin of the supply chain provides the information needed to make smart decisions on when to enter new markets, where to introduce new products, when and where to increase production capacity, and how to effectively compete. A digital twin provides a rich environment for running “what-if” scenarios of likely disruptions to determine the appropriate response before they happen. When the disruption does take place, a pre-established plan can be executed beating competitors to market.

How might a digital supply chain transformation change your daily life?

  • You have real-time, accurate information, eliminating the need for data manipulationPicture1blog
  • Collaboration on actual supply chain activities is online and in real-time
  • “What-If” scenarios and simulations are automatic, intelligent and include sufficient data to make informed decisions
  • Supply chain decisions move from calendar driven to continuous optimal response

A digital transformation of your supply chain can help you harness visibility, velocity and value and allow you to compete and win in today’s competitive marketplace.

To learn more about digital transformation, read Technology Evaluation Center’s report, The Impact of Digital Transformation on the Supply Chain.

 

About the author 

Hank Canitz PictureHenry Canitz is The Product Marketing & Business Development Director at Logility. To read more of Henry’s insights visit www.logility.com/blog.

Embracing digital disruption

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Digitalization is changing the game for every industry—and every industry knows it. In one report dealing with the financial industry, 100% of business leaders surveyed said that they expect their sectors to be impacted by digital disruption in the future.

While almost 90% of manufacturers said they’d consider implementing digitally disruptive technology, only 28% think it will generate increased revenue, and only 13% see digitization as a path to a new revenue model. Manufacturers—and industries in general—are worried about the risks of digitally disrupting their current processes and technologies, especially if they’re already profitable.

System-wide change would cause trepidation in any organization, but it’s necessary to address those fears to be able to transition into the new age of hyper-connectivity. Right now, industries and companies need to figure out how they will embrace new technology, put aside their doubts, and make digital disruption work for them—before it’s working for one of their competitors.

Hear Infor President Duncan Angove discuss digital disruption and bridging the gap between what an analog company can deliver and what today’s digital customer expects.

 

About our Guest Blogger

Helen Masters
Vice President & Managing Director, Infor South Asia — ANZ & ASEAN

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Helen Masters is Vice President, South Asia – Infor ANZ & ASEAN where she is responsible for the development and promotion of global corporate products and seamless customer experience to augment market presence in the Pacific and ASEAN regions. These comprise Australia & New Zealand, Indonesia, Malaysia, Philippines, Thailand and Singapore.

In her role, Helen maintains new product lines with a focus on customer and partnership management and strategy-setting to grow business in Infor’s key micro-verticals in the South Asia region.

Prior to Infor, Helen was Vice President, Commercial and Emerging Markets, SAP; and Head, Emerging and Transformational Alliances Group, Cisco Systems where she was responsible for the launch of data business solutions.

Helen is a graduate of Macquarie University, Sydney, Australia and is also certified in Computer Programming.

Are you prepared for digital transformation?

Unless you have blocked out every media message, it’s likely you’ve been exposed to the sweeping changes that digital innovation and technology are bringing to the business world. In fact, a few pundits have noted that the expectation for digital innovation and technology may surpass the business impact of the Internet.

The question is not a handwringing “what to do?” but rather “how can our organization take advantage?” Then, as quickly as possible, leap ahead of competition, grab market space and market share, garner a higher portion of wallet from customers, and make progress toward your goals.

In our experience, organizations typically grapple with three main goals:

1.   Connecting to their customers in a meaningful way—For example, an Australian customer we worked with saw the impact of moving from a manual paper-based sales order system to a digital-based system that is fast and accurate. And, it saw a typical 2-week contract renewal cycle reduced to just 1 hour. The Infor Digital Engineering team provided a way to evaluate existing processes, and propose the optimal mix of software solutions to help make this change happen.

2.   Improving employee engagement—With today’s multi-generational workforce and the ease of technologies like smartphones, iPads, apps, streaming, and such, many workers expect the work systems they use to operate much the same as those in their personal life. Working with several retail customers on work scheduling, we found it was typically incumbent on employees to go to the store to get their schedule. By examining the process, Infor digital engineers were able to understand the current operations, and integrate a digital system whereby employees are notified via text, email, or even their wearable technology about their work schedule.

3.   Creating greater operating efficiencies—That’s expected if you improve the connection to your customers and employees. But there is more opportunity here in the realm of data analytics. When it comes to digital innovation, this area is very important. Analytics used to mean a view of what was done yesterday, last week, or last month. But now, we can look forward with predictive and prescriptive analytic capabilities. There is solid research available discussing the impact of digital on growth. This slide from Dell Technologies shows 34% of businesses are evaluating what to do, and only 15% of companies are doing nothing. Don’t let that be you.

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About our Guest Blogger

Helen Masters
Vice President & Managing Director, Infor South Asia — ANZ & ASEAN

Helen Masters_VP ANZ & ASEAN_2_highres

Helen Masters is Vice President, South Asia – Infor ANZ & ASEAN where she is responsible for the development and promotion of global corporate products and seamless customer experience to augment market presence in the Pacific and ASEAN regions. These comprise Australia & New Zealand, Indonesia, Malaysia, Philippines, Thailand and Singapore.

In her role, Helen maintains new product lines with a focus on customer and partnership management and strategy-setting to grow business in Infor’s key micro-verticals in the South Asia region.

Prior to Infor, Helen was Vice President, Commercial and Emerging Markets, SAP; and Head, Emerging and Transformational Alliances Group, Cisco Systems where she was responsible for the launch of data business solutions.

Helen is a graduate of Macquarie University, Sydney, Australia and is also certified in Computer Programming.

Digital supply chain transformation: real and viable or just tech hype?

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The words “digital transformation” may appear to your colleagues as just the next tech hype. After all, weren’t we all just talking about cloud?

But just like cloud, digital transformation is real and viable — and here to stay.

Sure, but what is digital transformation exactly? There are as many definitions as there are pundits and luminaries. Infor President Duncan Angove talks about it this way: Digital transformation is about closing the gap between what your DIGITAL customers expect and what your ANALOG organisation can actually deliver. The aim of digital transformation is to go beyond merely automating a process or reducing costs, and to differentiate a company in significant ways from its competitors.

“Software and technology is disrupting every industry we look at,” Angove says. Whether it’s Uber in transportation or Airbnb in hostelry, every industry is being disrupted by the application of technology.

“Infor is at an interesting intersection, because we are a software cloud technology company that understands industries. So companies are coming to us, asking how we can help them navigate this digital disruption and take advantage of it.”

Here are just a few examples:

DSW – developing a strategy for a fresh customer experience

Nordstrom – creating a converged commerce experience for customers

Travis Perkins – delivering a variety of strategic, technical, and financial benefits

Fuller’s – deploying cloud software as the basis of a radical business process transformation to drive growth

Echoing these customers, Infor recently hosted groups of executives from the US and Europe to discuss digital transformation. Representing manufacturing, financial services, consumer packaged goods (CPG), retail, and media and entertainment all said their organisations have digital initiatives under way.

Within digital, three common themes emerged: executive leadership is essential; employee skills have to keep pace; and the data deluge must be harnessed into actionable insights. Here is a summary of one of the events.

So, where should your company start? Get inspired here.

 

About our Guest Blogger

Helen Masters
Vice President & Managing Director, Infor South Asia — ANZ & ASEAN

Helen Masters_VP ANZ & ASEAN_2_highres

Helen Masters is Vice President, South Asia – Infor ANZ & ASEAN where she is responsible for the development and promotion of global corporate products and seamless customer experience to augment market presence in the Pacific and ASEAN regions. These comprise Australia & New Zealand, Indonesia, Malaysia, Philippines, Thailand and Singapore.

In her role, Helen maintains new product lines with a focus on customer and partnership management and strategy-setting to grow business in Infor’s key micro-verticals in the South Asia region.

Prior to Infor, Helen was Vice President, Commercial and Emerging Markets, SAP; and Head, Emerging and Transformational Alliances Group, Cisco Systems where she was responsible for the launch of data business solutions.

Helen is a graduate of Macquarie University, Sydney, Australia and is also certified in Computer Programming.

Digital transformation that drives progress

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Henry Miller once said “Whatever there be of progress in life comes not through adaptation but through daring.” To a large extent, that holds true in the business world today.

Many companies struggle with processes that can’t keep up with the pace of change, outdated business models, and an inability to stay competitive in a rapidly evolving global market. While adapting to these types of changes may be enough to keep the lights on, rarely does it lead to differentiation. What these companies need is to transform their business in a disruptive way that drives progress. We believe that digital transformation can lead to the kind of progress that can make a difference for a business, its customers, its industry, and the world at large.

But what exactly is “digital transformation”? Chances are you’ve been hearing the phrase bandied about; but you may not know what exactly it means—or why you should care. CIO.com defines digital transformation as “the acceleration of business activities, processes, competencies, and models to fully leverage the changes and opportunities of digital technologies and their impact in a strategic and prioritised way.” But more than just acceleration, digital transformation is about the need for businesses to outpace digital disruption and stay competitive in a rapidly evolving business environment.

At its core, digital transformation is all about disruption. Whether that disruption is beneficial or devastating depends entirely upon where you find yourself on the wave—at the crest or at the bottom. To embrace digital transformation, you need to make it part of your corporate DNA. You need to start figuring out:

* How to uncover the pockets of innovation in your company—and turn them into opportunities for organisational and go-to-market transformation

* How you can put the structure in place to support digital transformation—and make it sustainable

* How to create a clear digital vision with a strategy for digital transformation

* How to harness data science to drive transformation

* How to position your employees and your organisation to successfully execute a digital transformation strategy

Find help here on how to get started on your own digital transformation.

 

About our Guest Blogger

Helen Masters
Vice President & Managing Director, Infor South Asia — ANZ & ASEAN

Helen Masters_VP ANZ & ASEAN_2_highres

Helen Masters is Vice President, South Asia – Infor ANZ & ASEAN where she is responsible for the development and promotion of global corporate products and seamless customer experience to augment market presence in the Pacific and ASEAN regions. These comprise Australia & New Zealand, Indonesia, Malaysia, Philippines, Thailand and Singapore.

In her role, Helen maintains new product lines with a focus on customer and partnership management and strategy-setting to grow business in Infor’s key micro-verticals in the South Asia region.

Prior to Infor, Helen was Vice President, Commercial and Emerging Markets, SAP; and Head, Emerging and Transformational Alliances Group, Cisco Systems where she was responsible for the launch of data business solutions.

Helen is a graduate of Macquarie University, Sydney, Australia and is also certified in Computer Programming.

Digital supply chain transformation and customer-centricity

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Turning a digital business strategy into a reality remains elusive for many organizations. Even businesses that are forward thinking and have already begun developing a digital transformation strategy will find new gaps to fill and new challenges to address that didn’t exist last year in the areas of new regulations, new trade policies, and new customer demands, to name a few.

As a result, many businesses are recognizing that digitization is not only about improving business processes or automation. Digital transformation is about redefining business. It’s about wrapping services around products, or going a step further, replacing products with services.

Cloud technology is a catalyst to new business models, with data, digitization, and networks serving as the underlying core. When this is applied to a supply chain — where hundreds of people and parties impact the order, production, and delivery of goods — it spawns new ways for businesses to service customers.

Supply chains are rife with inefficiency, bottlenecks, and information silos. They tend to be set up as long, winding linear trails of business transactions. Data and visibility remain bottled up in each trading partner organization. This fragmented landscape has become inadequate in today’s world of always-on commerce and ultra-demanding customers. On the surface, there is low-hanging fruit in digitization of processes such as order management or supplier collaboration. But digital transformation possibilities run much deeper, into the foundational infrastructure of business-to-business commerce, where a network approach to business can deliver massive returns by finding new ways to deliver value to customers.

Transforming entire industry supply chains

Digital transformation is a broad term being probed and defined in multiple ways. In some industries, such as automotive, the movement is not so subtle — and more of a change locomotive. Disruptive factors such as connected cars and autonomous vehicles are reshaping the industry. The transformational vision for automotive companies is a new ecosystem of suppliers, original equipment manufacturers (OEMs), dealers, and complementary services that enable new customer experiences and products to be delivered.

The industry is well on its way. Major players like Ford are investing heavily in technology. Ford just raised $2.8 billion to drive new innovation. The company has already committed to spending $4.5 billion to bolster a lineup of electric cars, with plans to release a fully autonomous car in 2021. The ability to integrate new innovations, technologies, and suppliers into the automotive ecosystem will be key to excelling in the future.

In retail, digital disruption is being spurred by immense pressure from consumers. And similar to auto, where outsiders like Uber and Tesla bring disruption, retail has been upended by the Amazons and Alibabas of the world. Consumers are accustomed to Walmart-like low costs and Amazonian convenience and delivery. As a result, retailers across all segments are being forced to be hyper-sensitive to consumers’ needs and wants. But competing with Amazon on delivery services while offering competitive pricing comes at a cost — to profitability.

Retailers recognize the need to transform how they order, produce, and deliver goods to be customer centric in new ways, while remaining profitable. New experiences and services are essential. Consider how retail is already evolving and leading to supply chain transformation. Some of the growing trends in shopping today include social shopping, pop-up stores, mobile commerce combined with trucks and vans, click-and-collect, personal shoppers, subscription-based shopping …

In-store, retailers are innovating as well. Ralph Lauren has introduced interactive touch-screen mirrors in its fitting rooms. IKEA has deployed virtual reality to allow shoppers to envision new rooms in their home. West Elm, a furniture provider owned by Williams Sonoma, has announced plans to open five hotels, which will act as showrooms where consumers can purchase goods.

Under pressure from nontraditional competitors and demanding consumers, the future supply chain relies on a network of manufacturers, suppliers, and service providers built around the customer to deliver new experiences, services and value.

2017 will sharpen focus on customer-centric commerce

The bounds of traditional business are being stretched. In 2017, we’ll see technology trends that go deeper into the reshaping of business models and further redefine industries.

Automotive companies are evolving into transportation service providers. Competition from non-traditional players raises the bar on technology and connectivity, forcing automakers to find new suppliers and partners that can deliver tech savvy innovation.

Retailers are evolving to deliver new forms of experience to the consumer. Competition from beyond the traditional industry is forcing retailers to get closer to customers through fast or free shipping, free and simple return programs, customized goods, and seamless order fulfillment from any shopping channel.

Consumer product brands like Tide are getting into homes with their detergent pods; consumers push a button from their laundry room to place an order. This bypasses the retailer and goes direct to the consumer.

In 2017, questions such as “What defines a true automotive company?” or “What defines a true retailer or consumer product company?” will have to be examined and redefined.

At the centre, of course, is the customer. Customers expect and demand more. Delivering on these expectations and fulfilling orders requires manufacturers and retailers to rewire the way they produce and deliver goods to their customers.

2017 looks to be a year of uncertainty and change. Social, technological, environmental, and political disruption will have massive impacts on commerce and supply chains. For businesses operating in nearly any industry, this means more pitfalls and challenges, accompanied by more pressing demands from customers. Companies and trading partners that fail to adapt are at risk.

Supply chains of the near future will have to operate as customer-centric networks. This should be the end state, or vision. Getting there requires a long road, starting with digital transformation.

 

About our Guest Blogger

Helen Masters
Vice President & Managing Director, Infor South Asia — ANZ & ASEAN

Helen Masters_VP ANZ & ASEAN_2_highres

Helen Masters is Vice President, South Asia – Infor ANZ & ASEAN where she is responsible for the development and promotion of global corporate products and seamless customer experience to augment market presence in the Pacific and ASEAN regions. These comprise Australia & New Zealand, Indonesia, Malaysia, Philippines, Thailand and Singapore.

In her role, Helen maintains new product lines with a focus on customer and partnership management and strategy-setting to grow business in Infor’s key micro-verticals in the South Asia region.

Prior to Infor, Helen was Vice President, Commercial and Emerging Markets, SAP; and Head, Emerging and Transformational Alliances Group, Cisco Systems where she was responsible for the launch of data business solutions.

Helen is a graduate of Macquarie University, Sydney, Australia and is also certified in Computer Programming.