For years, omnichannel commerce has been flourishing as a way of life for the retail sector, with the pandemic supercharging that growth virtually overnight. Though lockdowns prompted consumers to favor online fulfillment, many are now venturing back into brick-and-mortar retail stores with the protection of vaccines. But from all indications, buying behavior has changed forever, with consumers opting to purchase along the whole panoply of omnichannel options. This plus the fact that consumer expectations have never been higher, translates into enormous complexity for omnichannel retailers’ supply chains.
Many retailers, and especially warehouses, have yet to switch over to newer tools and strategies, and thus struggle to keep up with demand. Tackling these challenges are only exacerbated by outdated, inflexible, installed warehouse management systems.
Cloud-native WMSs, on the other hand, enable retailers to profitably deliver in the chaotic environment of supercharged consumer expectations, labor shortages, product shortages and myriad other factors. They are "versionless" — meaning they can be continuously updated via the cloud. There are no installed version releases, and no need for costly and time-consuming software modifications. Following are four ways cloud-native WMSs can resolve some of today’s most pressing supply chain challenges.
Enable flexibility with a versionless WMS. Say a company installed a state-of-the-art WMS four to five years ago. Then a disruptor like COVID-19 changes the retail paradigm overnight. The company responds, but the traditional, installed WMS isn’t necessarily designed to handle such volatility. So the company attempts to modify its WMS. Such modifications take time and hamper the company’s ability to respond to the marketplace with agility.
The new generation of WMSs takes a different approach entirely. The application isn’t installed, so it never needs upgrading. Rather it resides in the cloud and, as such, is versionless, with continuous access to new capabilities. When, for example, a retailer needs more functionality or processing power, the cloud-native “active” WMS automatically scales to match that need. Artificial intelligence and machine learning enable it to learn and adapt, and the solution is engineered to extend, quickly and easily.
Combat the labor shortage. In July 2021, ARC Advisory Group reported that the warehouse and transportation industry had 490,000 unfilled job openings. This gap may surge by 20% to 100% during the holiday season.
In the warehouse, traditionally low wages and a physically demanding work environment contribute to the labor shortage. A third reason, however, is a lack of investment in tools that both simplify the worker’s job and at times even make it more enjoyable.
Traditional, installed WMS user tools can be difficult to use and require extensive employee training, impacting productivity and costs. By contrast, versionless WMSs bear little resemblance to installed WMS user interfaces. Instead, they are modeled after the app-based appearance of a smartphone or tablet. The user experience is familiar to today’s workforce, significantly cutting down learning time and training expenses. One retailer reduced its warehouse employee training costs by 75%.
The active WMS also increases employee engagement through gamification, utilizing goal-setting and performance-tracking — for example, tracking their performance in real time or keeping running totals on reward points and job successes. Reward points could be a preferred parking lot, a gift card, or other forms of recognition offered by the company.
Reinvent labor management. Many companies have implemented labor management software (LMS) as part of their installed WMS. But traditional LMS is focused on providing management with static data. With an installed WMS, management does not have the option to motivate employees to be more productive through advice or reward systems. Next-gen WMSs need labor management tools that do both: keep supervisors informed for labor management purposes in real time, and keep employees happy and engaged through the incentives gamification provides.
More specifically, supervisors need tools to monitor and manage the workforce more efficiently — tools with the capability to provide immediate visibility into where the warehouse is operating well, and where there are deficit or overage hours. This enables the supervisor to adjust on the fly and model the change — all to gain more productivity, better utilize people and assets, and reduce costs.
Utilize all inventory, regardless of location. To optimize inventory investment, e-commerce networks must use all network real estate assets — distribution centers, stores, suppliers and manufacturing plants — as ship-from sites. They must figure out how best to dynamically move goods to market and customers, regardless of source point. This provides the nimbleness a retailer needs to service its customers more effectively.
“Inventory should not be dedicated to one channel; companies should have cross-channel inventory pools,” a recent McKinsey & Co. white paper observed. “Algorithms — which should take into account factors such as forecast demand, the accuracy of past forecasts, lead times and lead-time reliability — should define optimum inventory levels at each node in the supply chain, including in DCs and stores and with partners.”
Active WMSs can perform such optimizations, in real time. The results: better service to customers, better inventory optimization and a reduction in supply chain waste.
Manhattan Associates Leads the Way With Active Warehouse Management Solution
Founded in 1990, Manhattan Associates is a provider of supply chain and omnichannel commerce technology solutions. The company designs, builds and delivers a cloud-based WMS so companies can reap the rewards of the omnichannel marketplace across the store, through the supply chain network or from a fulfillment center.
Manhattan’s Active WMS performs a full portfolio of warehouse management services, including:
Manhattan’s active warehouse management solution “is a cloud-native application built entirely from microservices,” explains Adam Kline, senior director, product management with Manhattan Associates. “This means you can ‘set it and forget it’ when it comes to performance, resiliency and extensibility concerns. When your business has higher demand and your systems need more capacity, the solution uses artificial intelligence and other tools to automatically allocate more. And when you need less, it readjusts, without any intervention.”
The solution is also designed with the help of its users. “We work with the customer and explore opportunities for product advancement together, so the customer has a direct role in product development.”
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