What Has Not Changed in the Supply Chain in the Last 10 Years
By Aptean WMS
Build Your Technology Strategy by Reviewing a Decade of Supply Chain Constants
“When you have something that you know is true, even over the long-term, you can afford to put a lot of energy into it.”
- Jeff Bezos, Chief Executive Officer of Amazon
Today’s supply chain is nearly unrecognizable from a decade ago. With the advent of mobile technology, cloud platforms and sophisticated material handling equipment, the way customers search and buy products has evolved just as dramatically as the way warehouses fulfill those orders.
The Supply Chain of Technology Innovation
In the four walls of a warehouse, staying ahead of the innovations can be daunting. Real-time information, flowing seamlessly, manages every stage of every transaction. Data capture is web-based and mobile, supporting now familiar Apple and Android devices. Robots and drones are even working alongside human counterparts. All in all, automation has been taken to the next level.
"I almost never get the question: 'What's not going to change in the next 10 years?' And I submit to you that that second question is actually the more important"
The sheer volume of technologies, tools, and processes available to improve supply chain performance is almost overwhelming. So where should you get started evaluating the latest advances to drive your supply chain into the right here, right now digital economy?
Learning from the Past
Ironically, in a cutthroat, competitive economy where the goal posts are constantly shifting, defining a winning strategy to acquire and keep new business recommends a look into the past. Jeff Bezos, Chief Executive Officer of Amazon, illustrates this point perfectly in his comments about how to build a long-term growth strategy:
“I very frequently get the question: 'What's going to change in the next 10 years?' And that is a very interesting question; it's a very common one. I almost never get the question: 'What's not going to change in the next 10 years?' And I submit to you that that second question is actually the more important of the two because you can build a business strategy around the things that are stable in time. In our retail business, we know that customers want low prices, and I know that's going to be true 10 years from now. They want fast delivery; they want vast selection.”
Rather than being intimidated by change, focus your attention on what has remained constant.
To Bezos’ point, understanding what has not changed in the past decade is integral to knowing where you should invest in the future
Key things that have not changed within the Supply Chain in the past 10 years:
1) The Need for Speed
Speed is an ever-shrinking variable in the supply chain. In the past decade, we have seen delivery times shrink to same-day service in some areas. The drive to continually decrease fulfillment time will always be a constant.
Speed is driving technological breakthroughs as human labor is supplemented by automation in the warehouse. Speed is also driving innovative new warehousing practices like cross-docking techniques that handle incoming inventory to quickly turn it right back around to be shipped out the door.
2) The Need for Accuracy
Accuracy is the measuring stick of every operation. If your warehouse is not utilizing a Cloud Warehouse Management System, you may be running less than 99.999% accuracy at the bin location. Operating at lower levels of accuracy is a continual drag on the bottom line with inventory write-offs, shipping errors and fines eroding profitability and customer satisfaction.
Even at optimal accuracy levels, leading organizations today are experimenting with new drone technology to reduce errors further (See Walmart Looks to Drones to Speed Distribution, New York Times).
3) The Need for Visibility
Customers, partners, and executives always want to know the status of their order. From pre-sales inventory availability to shipment tracking, it will always be necessary to provide visibility of movement not only throughout your own supply chain but also upstream and downstream activity.
End-to-end visibility requirements will only grow as expectations for total transparency become even more embedded in the mind of the customer, regardless of systems or organizational walls.
4) The Need for Real-Time Info
Patience has never been a virtue in the supply chain. Over the past decade, there has been a steady progression of data availability. No longer do users have to wait for data to be refreshed, or reports to be run overnight. The lag time for data to be updated, pulled or passed between systems is now virtually non-existent.
The real-time nature of data throughout the supply chain will only become more important as customers, partners, vendors and internal stakeholders rely on up-to-the-second intelligence to make key operational decisions.
5) The Need to Access Data
Having data locked within a legacy WMS has always been unpopular, not to mention expensive. Older technologies, even homegrown applications, too often require an in-house IT specialist and their very own budget.
In a world where everything communicates with everything else, systems have become increasingly intertwined. To achieve performance metrics and better identify opportunities for improvement, information must be available on-demand, accessible, visible, reportable and exportable – without expert help.
6) The Need to Reduce Labor Costs
Keeping costs down is a constant struggle in the supply chain. With the most variable factor being labor, to truly reduce costs, you have to increase productivity. Automated data capture and better data management are just part of the equation.
Eliminating unnecessary item searching and idle travel to and fro goes far in saving time in the warehouse. Implementing new ways to ensure the right amount of the right stuff is exactly where it should be when needed most, is key to increased productivity and decreased labor costs.
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