From SCDigest's On-Target E-Magazine
- Aug. 28, 2013 -
Supply Chain News: Where are Warehouses and Distribution Centers Headed? Warehousing 2018 Predictions
New Report Says DCs to get Larger, Use of Cross Docking and Task Interleaving to Increase
SCDigest Editorial Staff
We must admit a fondness here at SCDigest for "future supply chain" sorts of thinking, so we were interested in a new report from Motorola Solutions on From Cost Center to Growth Center: Warehousing 2018.
We'd argue that the move to growth center has been around a long time, but nevertheless the new report - based in part on a survey of logistics professionals Motorola conducted earlier this - has some interesting data and observations.
SCDigest Says: |
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| 31% of respondents say they are using some form of cross docking currently, a number expected to rise to 45% by 2018. |
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What Do You Say?
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The report starts by noting several trends identified from the survey data.
Those include:
• 35% of companies say that plan to increase their number of distribution centers over the next 5 years, while 38% say they plan to increase the size of their facilities.
• 54% expect the number of SKUs they carry/manage will increase - only 10.7% expect SKU counts to drop.
• 48% say they plan on increasing their use of so-called task interleaving, which involves combining DC tasks in something akin to a "continuous move," such as a putaway move with a full pallet replenishment.
• Yet, 51% expect inventory turns will rise, whereas only 7% expect them to fall - that's a tough challenge with rising SKU levels.
Obviously, these and other trends will put more pressure on DC operations and likely require a higher level of supporting technology to maintain performance levels. Task interleaving in a large DC can be quite complex to implement effectively, for example, and almost by definition requires a high-end WMS and wireless terminal and/or Voice system for operators.
Moving Towards Flawless Fulfillment?
SCDigest has been on the "perfect logistics" bandwagon for a couple of years now (see The Coming Era of Perfect Logistics), and Motorola has been pushing a related concept it calls "flawless fulfillment."
Motorola sees four processes areas in distribution that will evolve to drive this type of increase fulfillment perfection.
1. Inbound Handling: The receiving and put-away functions will grow in importance as the first chronological step in streamlining warehouse operations. Changes include growth in the percent of inbound materials that are barcoded, more stringent demands from suppliers to support the receiving process, and increased use of productivity enhancing activities such as cross docking.
2. Storage and Inventory: Paper cycle count processes are on the endangered list as organizations turn to real-time, automated WMS entry, more frequent cadence for inventory validation (instead of just compliance for financial regulations), technology driven efficiencies in cold storage and improved asset tracking and management.
3. Pick and Fill: As the number one priority for most warehouse operations, pick and fill processes are becoming even more automated and more flexible using efficient new procedures such as task interleaving. Major technology changes include the reduction of scan-only or voice only picking and replenishment, giving way to more productive multimodal processes using efficient new handheld and wearable devices.
4. Outbound Handling: In the new warehousing world, customer satisfaction is seen as a major corporate objective and differentiator. Fast and accurate customer-driven requirements are playing a more important role in the packing, staging, loading and shipping functions, taking advantage of processes such as load optimization and performance monitoring.
As some further examples, say for inbound processes, 31% of respondents say they are using some form of cross docking currently, a number expected to rise to 45% by 2018. As with task interleaving, the idea of cross docking sounds great, but is often harder to implement in practice, especially outside of retail.
(Distribution/Materials Handling Story Continues Below
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