Analyst Insight: Warehouse management systems help businesses keep up with customer demand and order fulfillment. Yet, today's WMS needs more functionality for optimizing processes that incorporate current business constraints, such as labor shortages, too much inventory and transportation challenges. Warehouse executives benefit from using warehouse optimization technology that orchestrates activities within the warehouse so businesses can better meet customer deliveries on time and in full.
According to a Gartner report, "Top Technology Trends Transforming Warehousing Over the Next 5 Years: Part 2, Handling Volatility and Complexity," published on January 13, 2022, "Warehouse resource planning will help drive higher degrees of warehouse labor and equipment utilization, helping reduce labor costs and increasing order fulfillment rates. This will come by optimizing work allocation while considering warehouse constraints."
Warehouses need to adopt technology that deals with supply chain complexities, such as fluctuating consumer demand, fuel price increases, parts shortages and labor shortages. These challenges require sophisticated planning and scheduling solutions. Warehouses and distribution centers need advanced technology, such as artificial intelligence and machine learning, to meet the growing deficiencies in today's WMS.
Planners and administrative staff use all data available in every distribution center to manage shipping, receiving, dock schedules, inventory control and work release. Distribution centers have complex tasks that need to be performed, and each has a variety of constraints that need to be understood and balanced by the planning staff to get all the proper inventory out of the right door at the right time. The challenge is that there are just too many decisions to be made to optimize your warehouse and labor and deliver to customers.
Warehousing is like a game of chess where businesses deploy pieces (such as floor workers and automation equipment) that work toward completing an objective, such as shipping inventory on time. Unlike chess and its 64 squares, warehouses are much more complex, having 1000s of locations and dozens to hundreds of "pieces" moving around the facility to execute the workload. And many warehouse workers vary in skill from shift to shift. Given the complexity of the tasks to solve, these workers need technology to help them plan and schedule so that orders get out the door at the right time and are sent to the right place in the right quantities.
Using intelligent warehouse orchestration that works in conjunction with a WMS, warehouse managers can look across the fragmented operations in a warehouse and optimize labor, touches and inventory to drive efficiency. Often called WMS accelerators, these tools integrate data from across the enterprise, creating a unified view of the operations. Then digital twin, artificial intelligence, and machine learning technologies can be applied to determine what must be done to meet schedules and create optimal plans.
WMS accelerators adapt and rebalance activities based on what happens inside a warehouse in near-real time. WMS accelerators rearrange schedules, review labor requirements, schedule replenishments, cross-dock orders, and ensure shipments arrive on time and in full. They also ensure that the right amount of labor shows up at the correct dock with the inventory needed to fill orders. With this technology, warehouses can be brought into the 21st century.
Outlook: Most supply chain organizations invest in warehouse management system upgrades, yard management systems, labor management, warehouse control systems, inventory management systems, slotting systems and more. The need for a single software to consolidate all other software running siloed operations has never been greater. With chess as the model, it should be possible to have all warehouse execution planning be done by AI, to maximize warehouse throughput while minimizing cost.
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