DC Velocity - April 2014

OVER THE PAST FEW DECADES, LOGISTICS PROFESsionals have overwhelmingly turned to software when they wanted to give their warehouse and transportation operations a boost. But what types of software tools are they using? Are they sticking to such traditional applications as warehouse management systems (WMS), transportation management systems (TMS), and labor management systems (LMS)? Or are they venturing into new territory, embracing the powerful new tools developed for big data analysis?

To get a better sense of software’s role in distribution today, DC VELOCITY conducted a survey of its readers earlier this year on their use of supply chain applications. Two hundred and thirty readers took part in our research, which centered on the kinds of software deployed in distribution centers. When it came to the type of business they worked for, survey respondents covered the gamut, with 32 percent hailing from wholesale distribution, 29 percent from manufacturing, and 14 percent from the third-party logistics side. Another 11 percent worked in retail and 6 percent in transportation.

WMS COMES OUT ON TOP

So what applications are readers using? Not surprisingly, warehouse management systems topped the list, with 65 percent of respondents using this type of software. For the most part, these users are opting for the traditional approach to WMS deployment, installing the software on the company servers; only 8 percent of respondents deployed their WMS in the cloud.

The respondents were no newcomers to the WMS world.

Of those survey participants using a WMS in their DCs, 59

percent had been using this type of software for more than 10 years. Another 25 percent had used a WMS between five and nine years, while 16 percent had used the software for one to four years. Only one respondent said his/her company had been using a WMS for less than a year.

When asked what they used their WMS for, 91 percent said it was to oversee warehouse inventory—no surprise, given that this was what the application was originally designed to do. Eighty-two percent said their WMS directed receiving, putaway, and picking, another predictable response. What was interesting was the extent to which logistics managers are starting to use their WMS for more than basic activities. Forty-one percent said that the application did analytics, enabling the company to glean insights into ways to improve throughput. (See Exhibit 1.)

The survey responses provided a strong indication that many readers are operating automated warehouses. When asked if their WMS worked in conjunction with a warehouse control system, 48 percent said yes. Warehouse control systems serve as a type of “information bridge” between a WMS and the facility’s automated material handling equipment, transmitting instructions from the WMS to the automated devices.

STICKING TO THE TMS KNITTING

Despite the widespread availability of transportation management systems (including low-cost cloud-based versions), only 38 percent of respondents reported that they were currently using this type of software. As was the case with WMS, most of those deploying TMS were long-time users. Thirty-eight percent had used a TMS for more than