Gartner is fresh out with its Magic Quadrant (MQ) for Warehouse Management Systems for 2016.
As with all the MQs, this latest edition for WMS rates a series of software providers on two attributes (completeness of vision and ability to executive), rankings which in turn are determined by how lead analyst Dwight Klappich rates each vendor on a series of factors that together determine a point value for them on each dimension.
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| "Users are now demanding vendors have a coherent strategy for delivering a zero-modification [WMS] implementation," Klappich adds. |
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The actual quadrant chart itself with its dot placement for each vendor is reserved for Gartner clients, though it is sometimes available from WMS vendors covered in the report (that would be from those positioned as leaders, naturally enough).
But SCDigest also finds valuable the insightful commentary each Magic Quadrant usually offers on the trends in each technology area covered in an MQ. and Klappich does a good job of that in this year’s report.
Again this year, Klappich emphasized what he calls "supply chain execution convergence," which refers to the need for supply chain organizations to better orchestrate and synchronize execution processes across functional execution domains.
Klappich said that in in its 2014 SCM user wants and needs survey, Gartner found that more than 40% of respondents said that the inability to orchestrate and synchronize end-to-end business processes was one of the top three barriers to meeting their SCM goals and objectives.
"Warehousing and transportation are notable points of convergence, but they're not the only ones. True SCE convergence is when a vendor has developed multiple SCE and related functions on a common technical architecture that shares a UI, data model and business logic, and this is only obtainable from a small number of WMS vendors today," Klappich noted.
He also cites the on-going rise of Cloud-based WMS solutions in one form or another as an important trend, noting that "there are still differences between those vendors offering pure multi-tenant SaaS [software as a service] WMS and those offering dedicated Cloud WMS (that is, a single instance of the WMS hosted in the Cloud supporting an individual company)," adding that "While there are differences between the two approaches to cloud, Gartner's discussions with clients find that they do not have a strong bias one way or the other. If anything, we find a bias to dedicated Cloud, especially if the customer expects to need customization."
 Klappich also says multi-national companies are increasingly looking for a single WMS across all geographies, which can narrow the field of vendors able provide implementation and support services on a global basis, noting that "large multinational organizations with multiple warehouses around the world are looking to standardize on a common global WMS; in the past they might have had a variety of regional solutions."
Gartner sees two areas of potential growth for WMS vendors in what is clearly a very mature market. The first, is in international markets in emerging economies such as China, Brazil, Mexico and India. The second growth area comes from smaller organizations, often with less-complex warehouse management needs.
"We believe there will be a bifurcation of solutions, with one set targeted and best-suited for complex, sophisticated warehouse operations, and another oriented to less-complex and resource-constrained operations," Klappich wrote.
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That could lead to a situation in which "there could be two types of leaders in the future" - different WMS providers targeting complex and simple DC operations.
 But Klappich notes that "to address the needs of small and midsize businesses (SMBs), it's not just about price or "dumbing down" higher-end systems, but about designing for the needs of SMB users. Traditional WMS vendors have fallen into the trap of adding more and more functionality, which equates to increased complexity."
Gartner also sees a trend towards fewer and fewer modifications in WMS implementation, as one would expect as more and more functionality is included in the base packages.
"Historically, the extent of modifications required made WMSs among the least upgraded, often inhibiting the ability to adapt to future process needs," Klappich observes. "Consequently, users are increasingly focused on the painful costs of previous modifications to their WMS systems. They can spend more than 50% of post-implementation total cost of ownership (TCO) to support these modifications, and many are looking for ways out of this situation.
But Klappich says WMS Vendors are starting to meet these requirements with improved technical architectures that minimize or increasingly eliminate the amount of code-level modification. This shifts means changes to configuration or rules modification to tailor the functionality at any given site. He says some solutions are now built around scripting languages or model-driven process management capabilities to enable this flexibility.
"Users are now demanding vendors have a coherent strategy for delivering a zero-modification implementation," Klappich adds.
He also notes that while "WMS market is mature, with near parity in basic core WMS capabilities across product offerings, this is analogous to saying that all cars have four wheels, an engine, a transmission and a steering wheel. Indeed, most WMSs cover the most basic capabilities, but notable differences remain in core capabilities, just as there are differences among cars in their engines and transmissions."
Any reaction to the WMS trends from Gartner? What would you add to the list? Let us know your thoughts at the Feedback section below.
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