Inbound Logistics | May 2022

actions it will take and when, resilience is enhanced. “Partnership is an overused term,” says Kristi Montgomery, vice president of innovation, research and development with Kenco Logistics. But the more all parties can work together, the more they can boost value and responsiveness. For instance, the sooner Kenco learns a shipper is expecting significant growth, the more quickly the 3PL can implement solutions and technologies to facilitate that growth. Given that some technology solutions currently measure lead times in months—or longer—timely notification becomes critical. “It’s the whole concept of collaborative transparency,” Kristi says. Similarly, accurate, thorough data on the number of SKUs with which a shipper is working, along with requirements around packaging and labeling, are essential to forecasting labor requirements. This is another step to ensuring efficient throughput. VISIBILITY AND CONNECTIONS Along with operational changes, a few technology solutions are proving key to resilient DC operations today. Artificial intelligence and machine learning can provide visibility to products, allowing for better decision making. Distribution centers operators who know an upcoming component will be delayed can hustle to find a substitute or shift processes to accommodate the delay. Real time data exchanges between the warehouse and logistics operations, generally using API connections, also have become essential. While API is common in many customer-facing solutions, slower EDI or file transfer solutions still are common in back- end systems like demand planning, says Christopher Deck, founder and CEO of Deck Commerce, a provider of a cloud- based order management system. That can hinder responsiveness. “The name of the game is speed with respect to transferring data from one system to another,” Deck says. Technology also needs to facilitate communication across sales channels. “Siloed distribution practices create

Thoughtful operational changes and technology solutions can help distribution centers tackle current challenges, build resilience, and boost responsiveness. A starting point is ensuring the facility’s layout is as effective as possible, says Oleg Yanchyk, chief information officer and co-founder of Sleek Technologies, a freight procurement automation provider. Among other steps, this means assessing how to optimize the location of products and identifying ways to stage loads so drivers can efficiently drive in and out. An engaged, productive workforce remains essential to most well-run, resilient distribution centers. While technology has become increasingly essential, few DCs are completely automated. In light of the tight labor market, operators need to focus on being a strong employer. One way is simply to trust and respect workers and ask for their input before turning to outside consultants. “We often underestimate the people who are there every day,” says Ron Liebman, head of the transportation, logistics, and supply chain management practice with McCarter & English. “They’re logisticians, not just people in a warehouse.” Distribution center operators also want to consider technology’s ability to make employees’ jobs easier and more enjoyable, as well as its ability to automate processes. Technology can boost retention. For instance, autonomous mobile robots (AMRs) that work with employees (co-bots) can transport products, cutting walking time for employees. Effective supplier management, including the ability to quickly switch between vendors, can also boost resilience within a distribution center. Given ongoing supply chain disruptions, distribution centers need “secondary, flexible options,” Yanchyk says. If one supplier is unable to deliver, potentially delaying operations, another might come through. Connecting purchasing and warehouse operations also can enhance

operations. If purchasing isn’t buying in optimal quantities—perhaps because it lacks vital information—it’s more likely to purchase too little, risking delays, or too much, hindering efficient operations. Even once automation is introduced, most systems have some capacity limits. Distribution center operators need to identify the orders that will move to automation and those that will be handled manually. “You need both automation and coordination,” Moore says. CROSS-DOCKING AND SCHEDULING Just as airlines can ensure (most of the time, anyway) passengers will make connecting flights, distribution center operators need to coordinate their own operations with logistics. “To drive productivity, you need to increase the number of things that are cross-docked,” Moore says. This requires a detailed understanding of inventory placement and capacity, such as loaders and pickers. Schedules need to be synched, so items unloaded at one end can quickly ship out from the other, rather than sit on the dock or inside the distribution center. A common challenge is timely replenishment of pick spaces. That’s more likely to occur if activities within the warehouse are siloed and managed independently. Instead, distribution center operators should be able to identify in advance, often using technology, when items will need replenishment. In addition to knowing inventory levels, this requires understanding the workload and schedule of the pickers. Moreover, as retailers request more frequent shipments, the ability to wait days to unload a truck, because that’s when it best fits within the center’s schedule, is becoming more of a luxury. Instead, it’s more common to have to unload immediately, or close to it, because the products are going out in several hours. When information flows between shippers, manufacturers, and logistics providers, so each can identify the

46 Inbound Logistics • May 2022

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