Logistic Technologies
- 1. Logistic Technologies SCLT 3384 Kirby Nguyen, Alexander Huynh, Raul Gonzalez, Sana Hanif University of Houston
- 2. Warehouse Management Systems Warehouse Management Systems are key parts to supply chain and logistics due to the vast responsibilities and control it has over company warehousing. The WMS is a software application that companies must utilize to maintain the control over the daily operations that occur within the warehouse. Warehouse management, including transportation, communication, and physical warehouse infrastructures, are only a few responsibilities that WMS’s hold. Warehouse Management Systems must be listed at high priority to keep a company’s logistics and supply chain steadily moving forward, WMS can even be considered the highest role in overall supply chain. Warehouse Management Systems substantially increase supply chain performance, though it can be viewed as only a benefit, it takes a highly knowledgeable team to continuously focus and prioritize on maintaining the WMS. Early Warehouse Manage Systems were only able to provide simple storage and inventory location functionality, now the current WMS applications are highly multifarious and data intensive that a WMS can actually decrease performance of a supply chain without the committed workforce to operate them. The design of the WMS clearly must depend on the design of the operations being ran within the warehouse, every WMS has only one goal, and it’s to primarily control the movement of materials and management of a warehouse, so the design of the WMS must efficiently collaborate with the day-to-day operations within the warehouse. Popularized WMS’s include Oracle, SAP, and Fishbowl Inventory, helping companies all around the world, globally famous companies are partnered with these Supply Chain systems and continue to strive as market leaders. Majority of leading companies use WMS, rarely do you see companies that efficiently operate without a warehouse management system. Wal-Mart, Target, Kroger, etc. use extensive warehouse management systems that keep their heavy production and warehousing operating.
- 3. Possible reasons a company can fail while implementing a WMS, are inefficient tech teams operating the systems and overestimating the system, warehousing and logistics do not solely rely on this system to save or single-handedly run the company. Warehouse Management Systems are intended to help and energize warehousing when used correctly, these systems are vital parts of Logistics and Transportation technology. Business management has continued to evolve with innovations of technology being discovered and improved every day. This technology includes enterprise resource planning (ERP), which has played an important role in transforming business management by producing components that support a variety of business functions. The ERP industry supports businesses by providing technology solutions that organizations can use to collect, maintain, and manage data from many different business activities. Businesses benefit from ERP solutions by being able to integrate data and having greater visibility of data throughout the organization. Interpreting real-time data makes it easier to efficiently address concerns and issues in a timely manner. Overall, the software provides a map that ties critical data from all parts of the company into a single database, offering better future planning if used correctly. On the other hand, a key issue and risk of implementing ERP software is the cost in installing and training employees to use the system. Productivity can also decrease as companies and organizations begin to implement the ERP software and employees get accustomed to using the system. Companies that can afford the budget and the slight decrease in productivity would be best suited for this technology, because despite the downside of high cost, the benefits are still significant.
- 4. ERP (e.g. SAP or ORACLE), MRP, CRM, etc. One of the top brands of ERP software is Systems, Applications & Products, better known as SAP. One of the loyal customers of SAP includes the adidas Group, a well-known, global sportswear brand that has been around for 80 years. To achieve their goals of moving to an integrated omni-channel approach, adidas Group implemented the SAP Fashion Management application. This ERP solution helped adidas combine manufacturing, wholesale, and retail business operations onto a single platform. The Head of IT wholesale ERP at adidas Group, Kai Bienmuller, stated that “with SAP Fashion Management and SAP HANA, we will be able to greatly improve our customers’ experience…not only will these solutions help us become a truly omni-channel organization, they give us the insight to better anticipate customer demand both today and in the future.”
- 5. Warehouse design and management A successful supply chain business depends on efficient warehouse designs and management. This includes a detailed design and effective logistics practices in transportation and warehousing operations. A business must consider a location for a warehouse to ideally be close to markets and major highways, as well as an area that allows for easy and quick transportation. There should be enough space for easy transportation of containers and vehicles to unload and load necessary cargo in a timely and efficient manner. In addition, the layout of the building should provide safety and security operations. The dimensions of the building should be well thought out considering the type and amount of storage the warehouse will hold, in addition to the racking design the goods and materials will be stored in. Warehouse management will is also a key factor in a successful supply chain business. It is important to note that it is custom for a business to outsource the warehousing operations to a 3PL Logistics provider. At a distribution center, how operations are managed determine the success and efficiency of the organization. Analyzing the flow of materials, storage levels, organization of supplies and goods, staffing, and budgets are all components that warehouse management need to consider. Warehouse management has become significantly dependent on IT solutions and systems to operate efficiently. These integrated systems have helped warehouse management control inventory flow and unit levels, as well as manage operations effectively by allowing businesses to clearly interpret data and important reports. Having proficient warehouse design and management will help businesses reduce error and inventory issues. Furthermore, it will assist in having efficient movement of goods to ultimately provide throughput and profit for the business.
- 6. RFID Barcode scanning is slowly becoming a technology of the past. As RFID technologies continue to grow with improvements such as, temperature threshold sensors to monitor perishable food, the necessity of using barcode scanners is quickly diminishing. RFID technologies have been a revolutionary technological advancement in the field of logistics. The practice of RFID technologies has vastly reduced the costs of many company’s supply chains, the most popular being Walmart. Walmart started using RFID technology in 2003 with EPC specific standards. The EPC data format was designed to store manufacture IDs, product IDs, and serial numbers. The RFID tags were first used to track pallets that would travel through the supply chain. The results were substantial in resolving excess inventory and out of stock issues as stated in the International Journal of Information Technology and Business Management “In 2007, executive credited the technology with, among other things, cutting the volume of excess inventory in Walmart’s massive supply chain and slashing out-of- stock occurrences by almost one-third.”
- 7. CAO Another major technology that is continuing to revolutionize many supply chains around the world is CAO systems. Computer assisted ordering systems have many advantages. CAO systems help improve sales, lower inventory costs, reduce inventory theft, which in turn requires less labor expenses. The technology is only as efficient as the users that operate the system. In small retail stores that have implemented CAO, sales associates must undergo proper training on scanning items at the point of sale. For example, if a customer is buying a 12oz. Pepsi™ and a 12oz. Diet Pepsi™, the sales associate might be tempted to scan one of the bottles twice to save themselves the hassle of scanning the other bottle. This in turn will cause inaccurate data for the CAO system to properly replenish goods. I was able to interview my pharmacy manager Dr. Sherri Wade, who has worked for Walgreens for over 20 years. She has worked at Walgreens before CAO was implemented in the pharmacy. Dr. Wade explained the processes that the technicians would have to go through when ordering out-of-stock medications. Before CAO was introduced in the pharmacy setting, technicians would have to print a sheet of the daily out-of-stock items and first call other sister stores around them to hopefully replenish their out-of-stocks. If the sister stores did not have the medications needed, then ordering from a distributor was the next choice. The problem with ordering from the distributor at that time is that the technician would have to take a lot of time out of their busy work schedule to order the medications. The technician would spend a substantial amount of time going through a large binder of barcodes that were associated with each medication and distributor. Going through such a long list takes time away from the technician to perform their main duties, and reduced customer service while the technician was ordering. Besides the giant binder of barcodes that the technician has to sort through, they would
- 8. also have to manually enter the barcode number via the distributor’s voice answering system. Dr. Wade indicated that her pharmacy was seeing a decline in clientele due to poor customer service at the peak hours of business. Now with the CAO systems implemented, the technician need only 5 minutes to skim a printed automated order and then get back to their normal duties. Walgreens also possesses powerful computer software called IntercomPlus that gives them a competitive advantage over their rivals such as Walmart and CVS. Formerly known as Intercom in 1981, it was the first large scale retail pharmacy computer system that had ever been released. It relies on broadband and satellite connections to link every single Walgreens store together, creating their own private Intranet. This private Intranet network enables stores to seamlessly fill medications at any location even though the original prescription was dropped off elsewhere. Paper prescriptions can be scanned and sent electronically to any Walgreens in the nation. In addition, it is a main contributor in organizing inventory within the pharmacy by using a module integrated in the IntercomPlus program called SIMS. The strategic inventory management system can verify counts of many items and is also used for receiving and distribution within Walgreens. The system also has a “dial a pharmacist” feature, which allows a pharmacy team member to call someone who is currently signed in to IntercomPlus at another location to provide assistance to patients that speak other languages. Third Party Logistics A third-party logistics provider is a firm that provides service to its customers of outsourced logistics services for part, or all of their supply chain management functions. Logistics includes a variety of elements. Each element plays a big role in providing the service or good. The elements include warehousing, transportation, management, software, freight rate
- 9. negotiation, in-depth reporting, forecasting, freight bill, auditing and much more. Third party logistics can specialize in certain industries or specialize in a specific area (element) of logistics. 3PLs are shrinking in numbers, but growing in size. With the increased use of technology in the business world, “Simple bookings can already be made with tablets or mobile phones, cutting out the middleman’s fee (Bowman).” Therefore, removing the need for 3PLs and giving the shipper “fewer choices, but a higher quality of service from surviving providers (Bowman).” Because of the removal of the middle man, the shipper is left with less options but receives a higher value of service from the remaining providers. “Shippers will benefit from having brokers that can cover 500 loads a day. Prior to 2012, only one company in the country could do that as a non-asset based provider – C.H. Robinson (Bowman).”
- 10. Electronic Commerce Electronic commerce or ecommerce is a term for any type of business, or commercial transaction, that involves the transfer of information across the Internet. “It covers a range of different types of businesses, from consumer based retail sites, through auction or music sites, to business exchanges trading goods and services between corporations. It is currently one of the most important aspects of the Internet to emerge.” Ecommerce allows consumers to electronically exchange goods and services with no obstacle of time or distance. It has expanded rapidly over the past few years and is still continuing to grow. “The road to creating a successful online store can be difficult if unaware of ecommerce principles and what ecommerce is supposed to do for your online business. Researching and understanding the guidelines required to properly implement a business plan is a crucial part to becoming successful with online store building.”
- 11. Works Cited 1. "Customer Testimonials." Sap.com. Adidas, n.d. Web. 2. Scharf, S. (2012). Study of Wal-Mart Reveals First Benefits of RFID. Healthcare Purchasing News, 6. 3. (S. Wade, personal communication, Nov 1, 2015). 4. Bowman, Robert. "Third-Party Logistics Providers Are Shrinking in Number, Growing in Size." Forbes. Forbes Magazine, 3 June 2014. Web. 15 Nov. 2015. 5. "What Is Ecommerce?" What Is Ecommerce? Web. 15 Nov. 2015. <http://www.networksolutions.com/education/what-is-ecommerce/>. 6. http://www.ehrhardt-partner.com/en/warehouse-management/warehouse-management- system-lfs-enu/ 7. http://122.182.4.125/infiniumwebsite/Tech_RFID.aspx 8. https://www.nichirei-logi.co.jp/english/business/3pl.html 9. http://www.leadcommerce.com/blog/the-benefits-of-cloud-based-ecommerce-software- solutions.html 10. http://visual.ly/functions-erp