The future of DCs and warehouses

Data-driven, agile and real time

As a consulting firm, MCA Associates has done some great work, I believe, with our wholesale distribution clients in modernizing their distribution centers and warehouses resulting in significant increases in their productivity, reducing transaction costs, avoiding future costs, improving inventory control, inventory accuracy and order fulfillment accuracy.

Much of this has been accomplished through new or improved warehouse design as well as integrating new processes and equipment.

Having said that, we try not to think of ourselves as a “hardware shop.” Of course, automation and process improvement does remain pretty cool stuff.

But, time after time, we see the need for better enterprise software and analytics utilization to support warehouse management — something more connected. Specifically, the ability to connect people, processes and data in such a way that is usable and useful.

So, the DC and warehouse of the future doesn’t have to be just about automation and materials handling and storage equipment. I think it’s about ways to automate decision-making and the myriad of mundane processes that are currently done by people; being more data-driven, agile and real-time.

The key to the future of DCs and warehouses? It’s about the movement of data just as much as it is about the physical movement of product. In the future this may take the form of greater utilization of bar codes or even RFID tags.

In other terms, it’s about knowing where you stand in order processing, the remaining workload, where it exists, and the labor required to assure on-time processing — and delivery.

It’s about understanding “time-on-task” data, knowing how you are performing against expectations, not waiting for some report issued at the end of the week — but knowing right now!

It’s about understanding and using data to reveal the “root-causes” of waste — particularly wasted time.

It’s about understanding the data to drive you toward what picking and put-away methods are best for specific products and/or warehouse storage areas.

It’s about knowing when inventory adjustments should be made “on-the-fly,” rather than waiting for a scheduled physical inventory.

And that’s just a sampling.

For instance, in the future DC or warehouse, a facility could use information received from a carrier or from a RFID tag on a pallet about the delivery of product needed for a hot order or backorder. The warehouse could then pull together and stage the other items needed for the order. Sure, bar coding isn’t new, but the processes in which we use them may be new! In other words; how we do things and use the data. An explosion of data!

One of the biggest obstacles, I find, is the change in mindset required; not thinking beyond the traditional, in order to thrive. I can tell you, for sure though, getting data savvy in your DC or warehouse will be crucial. The businesses that stand out, that differentiate themselves, will be the ones which understand that they need swift, responsive systems and data capabilities that they can wield — to ensure survival in their ecosystem.

Fortunately, it can happen, and right now. 

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