MHI Solutions Improving Supply Chain Performance
BY CHRISTIAN DOW, EXECUTIVE VICE PRESIDENT OF MEMBERSHIP AND INDUSTRY LEADERSHIP, MHI
If you’re managing a warehouse or distribution center, then you’ve got many questions on your mind.
Do I have the products and manpower I need to get all these orders out the door? Are this week’s deliveries still on schedule? Am I meeting my customers’ expectations? Where are my major pain points, and how are they limiting my throughput? What would happen if orders spiked 20%? What would be the best type of automated material handling equipment to introduce into my facility, and how would it integrate with my current operations?
In decades past, warehouse managers had to rely on limited data and their intuition to make key decisions, and they had very little real-time visibility into their supply chain. But thanks to today’s robust suite of material handling software solutions, that’s no longer the case.
The modern supply chain has been fully digitized, largely through sensor-equipped material handling equipment, enabling warehouses to track their shipments from the time products are manufactured or ordered until they reach customers’ doorsteps.
Much of that data would be useless, however, if not for software programs such as enterprise resource planning systems, warehouse management systems, transportation management systems, yard management systems and warehouse execution systems.
By combining a facility’s historical data with its real-time production data, software platforms can help warehouses track their productivity both in the moment and long term. Software systems also allow companies to create “digital twins” of their operations so they can model potential material handling solutions and make smart decisions when allocating their resources, according to Bill Denbigh, vice president of go-to-market strategy for MHI member Tecsys.
“Supply chains are going through a digital transformation, and that’s the most critical thing to understand,” he said. “Everything about the supply chain used to be manual, but it’s all being tracked now, and the amount of data that’s being recorded across the supply chain is vast. Software is the glue that makes all that data accessible.
“End-to-end software is such a vital part of supply chain management because it allows you to make decisions based on data,” Denbigh added. “It allows you to look at your operations, highlight your issues and manage them to solve problems. It’s all about the data-driven insights that the software provides, which allow effective management of the supply chain.”
Software in Action
For a glimpse of the power of software, consider the case of the damaged beverage cups. Denbigh said a client that is a major supplier to the restaurant industry was getting calls from customers saying that pallets of beverage cups had been crushed in transit, and the damaged cups often weren’t noticed until the restaurants needed those cups to replenish their supplies.
The shipper put sensors on the warehouse doors of its major customers to measure the dimensions of each pallet as it came off the truck. When a pallet’s dimensions indicated that it may have been compressed during shipping, the sensor signaled the company’s business-intelligence software about the anomaly.
That allowed the shipper and its customers to take action before those crushed cups were actually needed, Denbigh said.
“If you know about a problem early enough, you can be resilient,” he said. “When you don’t have the time to do something about it, that’s when bad things happen.”
Ashley Rhodes, systems project manager for MHI member St. Onge Co., said modern warehouses are using ERP and WMS systems to track their productivity in real time and to optimize operations. Software can help warehouses evaluate whether they should continue to each pick or would be able to boost throughput by batch picking, for example.
It also can help warehouses to slot their products in optimal locations according to sales data, with the top-selling items situated closer to dock doors and the least popular items tucked away in the corners.
Software can measure the productivity of individual employees and teams, which empowers companies to reward their workhorses with pay raises and to provide additional training for any lollygaggers.
“A lot of clients are looking to use labor management systems as a way to offer additional pay incentives for their most productive workers,” Rhodes said. “Retaining good employees is one way they can gain leverage over their competitors.”