Gartner analysts Dwight Klappich, Simon Turnstall and Rishabh Narang recently released the firm's annual "Magic Quadrant" report for 2022 on Warehouse Management Systems (WMS).
Supply Chain Digest Says... |
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The Magic Quadrant is a technique Garnter uses across many technologies and even some service areas to rate vendors along two primary axes: Completeness of Vision and Ability to Execute.
Each of those dimensions in turn is calculated based on a large number of more granular criteria.
The Magic Quadrant report itself is limited to Gartner clients – though several vendors will make the report available on their web sites through special license with the analyst firm.
SCDigest can, however, report on some of the commentary on the state of the WMS market that goes along with the famous MQ graph itself and the individual analyses of various WMS vendors.
Gartner notes that even though WMS is a very mature market, recent disruptions have spurred innovation. In addition, the overall market is forecast to grow to over $4 billion by 2026 with a healthy five-year compound annual growth rate (CAGR) of over 13%.
Gartner adds that "WMS offerings continue to differ in areas such as usability, adaptability, decision support, scalability both up and down market, use of emerging technologies and life cycle costs."
Gartner also finds that companies increasingly favor supply chain suites that can support end-to-end supply chain and logistics process orchestration, and refers to this trend as supply chain convergence. In general, that means having functionality in areas such as labor management, transportation management, parcel shipping, slotting optimization, yard management and other applications that are integrated with vendor's WMS on a common platform.
Gartner aso sees a bifurcation in the WMS market between the high-performance, complex and sophisticated WMS requirements and the mass market where "good enough functionality is "good enough."
Klappich, Turnstall and Narangsay this is not because companies choose to sacrifice functionality. Instead it is because, globally, the preponderance of warehouse operations are Level 3 or below in Gartner's warehouse complexity model, with Level 1 being the most basic and Levels 4 and 5 being the most complex and automated.
"Warehouses at Level 3 and below do not require, nor would they normally use, the most advanced functionality," Gartner says.
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 Gartner adds this bifurcation highlights that there is a very clear market for high-end WMS solutions where feature/function and performance are critical and cost is less of an issue. This
makes for a healthy, although smaller, market for high-end, functionally-advanced WMS
solutions that are aimed at complex and sophisticated Level 4 and Level 5 operations
Given its maturity as a software category, now some 45 years since the first real-time WMS was deployed, basic core WMS functionality has remained fundamentally the same, Gartner notes. However, despite a certain commonality in capabilities, Gartner notes "there have been and continue to be improvements in the depth, number of options and flexibility of these capabilities, and notable differences remain in core competencies and extended capabilities."
In summary, Gartner says that some WMS vendors are challenging established leaders in a mature market by targeting critical outcomes such as cost of ownership, automation support, adaptability and cloud services."
What do you think of these key WMS trends? What would you add? Let us know your thoughts at the Feedback section below.
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