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Aberdeen published its latest report on the current and future state of warehouse processes and technology entitled "Agile Logistics: Transforming the Distribution Center," highlights the pressures facing warehouse professionals as they seek to support increased sales without increasing staffing or space. With this research, warehouse managers interested in benchmarking their performance and implementing changes to processes or technology will find a roadmap to achieving Best-in-Class performance.
Research results from warehouse respondents across industries reveals that 97% of all companies surveyed are redesigning their warehouse in the next 24 months, with 56% of Best-in-Class companies improving operations in the next 12 months. In order to better align warehouse operations with overall business objectives as part of this redesign, 67% of those surveyed plan to start with improving warehouse processes, with 32% planning to upgrade or enhance their warehouse management software.
A key finding in the report that truly differentiates Best-in-Class performance is centralized direction of processes within the warehouse, currently practiced by 78% of Best-in-Class companies. More importantly, over two-thirds of these companies maintain centralized control with commercial Warehouse Management Software (WMS). Aberdeen's research has continuously shown WMS solutions to be enablers of cost reduction and process improvement. However, despite the benefits and advantages delivered with a WMS implementation, Aberdeen's research also shows that 68% of Laggard companies still utilize paper or spreadsheets to manage their warehouse(s).
As a result of the slow WMS adoption rate among Laggard organizations, Aberdeen sees them behind the curve in the utilization of value-added services, warehouse process optimization, mobile device adoption, and reverse logistics, which the report discusses in more detail. While these companies focus on automating their data collection and report generating capabilities, Best-in-Class companies are exploring ways to improve throughput and labor efficiency, and extend their WMS investments.
Extending core WMS benefits through integration with other warehouse systems provides significant opportunity for improved agility and cost savings. By 2009, Aberdeen expects over 50% of Best-in-Class companies to be using or have implemented additional warehouse technology such as Labor Management Software, Ruggedized Mobile Computers, Voice Technology, Yard and Dock Management, and Slotting Optimization. The utilization of Material Handling Equipment, including case or pallet handling Automated Storage and Automated Retrieval (AR/AS) is another top growth area over the next 24 months.
"Despite the economic slowdown, companies that are truly looking to create Best-in-Class distribution centers are taking advantage of the next wave of process and technology investments in order to create greater agility and reliability," said Bob Shecterle, SVP/Group Director-Research, Aberdeen. "The greater the agility, the greater the ability to react quickly and effectively to uncertainty. With technology and processes improvements, today's leading distribution centers are delivering greater value without increasing costs; the real difference maker."
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