Top Supply Chain Trends in 2017 – Part II

Top Supply Chain Trends in 2017 – Part II

Top Supply Chain Trends in 2017 - Part II

In part 1 of our 2017 trend analysis, we introduced you to the ARM (Analyze, Retrofit, Modernize) framework that is driving our 2017 trends analysis. We then discussed the trends in Analyze and started to talk about how you can Retrofit your supply chain with voice and vision picking technologies in 2017.

To continue our discussion of Retrofit, we start with a technology that the biggest players in the supply chain industry are capitalizing on and how you can capitalize on it in 2017.

By Chris Elliott, Senior Consultant, Strategy ServicesChris Elliott

@chris_speaks on Twitter

We talked about how we can retrofit the workforce in part 1, but what about the powered equipment in our facilities? Is there a way to augment equipment to make it more efficient?

There is; and one of those technologies is fuel cells.

Fuel Cell Systems

The hydrogen fuel cell has been around for a long time, but with reduced costs and increased safety, it is rapidly becoming the technology of choice for non-hazardous environments with battery driven material handling equipment. Due to its long operational live and reduced refresh time, the hydrogen fuel cell is a great option for facilities looking to reduce their equipment cycle time and increase the productivity of their equipment.

We think in 2017 that this technology will start getting more publicity and start to make large inroads into the general material handling environment. With the largest retail companies in the world making the switch to fuel cells, it will not be long until the technology is adopted by companies around the world.

Out of the Box Automation

Not every company has the resources or the ability to jump into the full automation of their facilities. While automation plays a role in the future of the supply chain, it is still difficult to sell it to senior management that is worried about the risk of a large capital investment. That is why we are seeing a role for out-of-the-box automation in the coming years.

What out-of-the-box automation covers are automatically guided vehicles (AGVs) that reduce or eliminate human operators in relative tasks. There are two examples that can be brought into operations today: AGVs that follow the picker for case or each pick operations and AGVs that move pallets from zone to zone in a facility.

In the first example, 2017 will see more companies putting automatically guided walkie-riders that will follow pickers to their pick destination. This will allow the pickers to focus on picking instead of trying to move and pick. Companies can also put this into existing facilities without having to install conveyors or other metal intensive systems to increase efficiency.

We will also see pallet moves to and from production areas be automated with AGVs. This technology will eliminate the labor that is needed to do nothing more than move pallets all day and free up labor value added activities.

Cloud Based Bolt-ons to Enhance System Capabilities

While Blue Horseshoe has been helping many companies make the leap to cloud based ERP solutions, there are many companies that are still working with 20 year old, or older, legacy systems. These systems are becoming harder to maintain and challenging to find people to even maintain them. Rather than continually try to make changes to the systems, more companies will look to create larger bolt-on packages to enhance the operation of their legacy systems.

In 2017, this will go beyond simple applications and companies will be presented with the option for adding powerful bolt-on systems. We can see this as analytical systems, warehouse management, and distributed order management. These functions will be the real drivers of future supply chain efficiently while the legacy system is evaluated for replacement.

In 2017 Blue Horseshoe will work with Microsoft and other partners to deliver clients cutting edge supply chain bolt-ons that will deliver improved functionality in the cloud without the headache that modifying a legacy system can cause.

Mechanize

The ARM framework is a journey, and different companies will start that journey at different times.  We recommend that all companies start with a detailed analysis. But after that, many forward-looking companies will have the means and the desire to leapfrog the current retrofits and move to systems that will allow them to automate more of their facility than has been previously possible. If there is one thing to watch this year, it will be the opening of more highly automated facilities that greatly reduce the labor required to operate the facility.

Warehouse Control / Execution system

Automated facilities of the future are like orchestras. There are a lot of different instruments that have different roles. Just like an orchestra, if there is not strong direction then the music can sound horrible. That can be the case in facilities that don’t look at warehouse control and execution.

In the coming year, one of the biggest markets will be in warehouse control and execution systems. These systems are the brains for warehouse automation and without them, the different components of the automated systems can’t talk to one another. The other key role is advanced management and execution of the work within the facility. The warehouse control or execution is vital to how work is processed in the warehouse.

Another key point is that many of these systems are starting to converge. In the past we have had warehouse control and execution systems separate, starting in 2016 and moving into 2017, those systems are starting to converge and you are seeing overlap in many of the functions they offer. It is a requirement before starting automation to make sure that you have a partner that fully understands the role of warehouse systems and how they can be best utilized in the automation project.

Autonomous AGVs

Where semi-autonomous AGVs fill in gaps in moving products around a facility, fully autonomous AGVs are ones that are completely responsible for picking, moving, and putting a product into a consumption or picking location. These AGVs can operate outside of human contact in a separate area or within a dedicated stack with crane driven robots.

In 2017 as with past years, we are going to see continued development and opportunities to implement autonomous AGV’s within warehouses. The technology has been well established in mini-load and full AS/RS systems, the new twist this year will be autonomously linking the AS/RS to the receiving and shipping process with the same or other AGVs. This has the potential to almost fully automate pallet-in and pallet-out operations.

Automated picking

The challenge in the coming years will be automating all types of unit picks. While systems have been available to handle very uniform products in A-frames, a large scale high variability shape and sized automated picking system hasn’t been available in the market.

While it didn’t happen in 2016, and it won’t happen in 2017, there will be more companies releasing proof of concept automated picking solutions. While some are trying to model their robotic pickers on human hands and arms, there are many approaches that could see a series of suction devices combined with finger like stabilizers that rapidly handle picking.

Whichever way the industry trends, Blue Horseshoe works with our clients to help choose the right solution for their products today and tomorrow. Whether we can get to a lights-out warehouse in the next 10 years will be interesting to see, but it will require work to be done to better automate the work that is still best done with human hands.

Intelligent Systems

Lastly, we can automate our facilities, but we will also need to automate how we make decisions when things go wrong. Historically we have utilized humans to respond to customer requests and responses; but in the future, we will need to automate many customer facing areas of our business. In order for this to happen, companies will need to follow the trend of intelligent systems.

These systems are beyond data analysis packages and are moving companies toward being able to let systems interact with customers to help order or resolve issues. There are companies today that utilize these systems in their customer support chats. These systems are able to analyze the request form the customer and respond automatically for support. The only time humans get involved is if there are nuances to the communication that the system cannot understand.

Top Supply Chain Trends in 2017  – Recap

 2017 will turn out to be a time of great change for the industry. We at Blue Horseshoe will see many companies embracing the next generation of Cloud Based ERP and our Supply Chain group will continue to assist clients with delivering the next generation of supply chain software, consulting, and solutions.

Let’s recap.

In this series of articles, we are looking to ARM you for Success in Developing the Supply Chain of the Future. To do this we broke out the trends that were are seeing into two major categories:

A – Analyze

R – Retrofit

M – Mechanize

Enablers

But those are not the only trends that we see affecting the conversation over the next 12 months, there are a number of Enablers to the Supply Chain of the Future that will also be significant points of conversation.

Talent

In our facilities and in our corporate offices, there is a large gap between the talent a company has to what a company needs to be successful in the coming years. Where companies had invested heavily in workers that could deal with the transaction aspects of supply chain management, we need a new generation of supply chain workers who can utilize the new technologies to automate workflows, speed up delivery times, and automate the development and reporting of KPI’s to management.

It is estimated that by 2020, there could be up to 100,000 jobs in the supply chain that will go unfilled due to the gap between skills needed and those available in the market place. This covers the people who design the supply chain of the future, as well as the operators who are executing the work as well and installing and maintaining the systems.

Solution Providers

As the talent market changes, so does the need for the solution providers. Companies do not have the time or the budgets anymore to develop a portfolio of solution providers. It is becoming far more efficient for a company to select one key solution provider that has a full portfolio of solutions. From designing the supply chain, to software, to equipment, companies need providers that have a full suite of solutions available to implement.

Blue Horseshoe is one of those rare companies that provide a full array of retail and distribution solutions for our clients. From the strategic design of a supply chain, through systems, and the physical equipment in the facility, we are able to design, build, and manage projects for clients that see the trends and need a solution provider that can lead them to the Supply Chain of the Future.

In Summary

These trends will drive the discussions in the breakrooms and boardrooms in the coming year and beyond. Whether it is with anticipation or fear, change is coming and we are here to help you navigate the waters of change. Please contact us if you would like to know more about these trends or need to schedule a visit so that we can find out how to create your supply chain of the future.

If you would like to know more about how to implement the Supply Chain of the Future, Blue Horseshoe will be presenting more on this topic.

UPCOMING EVENTS

APQCChris will be presenting a webinar on March 22 – “Warehouse of the Future” for APQC at 11 a.m. CST.

 

ProMatChris will also be presenting a “Step by Step Guide to Implementing the Supply Chain of the Future” at Promat 2017 on Monday, April 3, at 3 p.m. For info on this:http://www.promatshow.com/education/seminar.aspx?ref=global&id=1143

 

Previous Trend articles … 

2017 Supply Chain Trends:
Top Supply Chain Trends 2017 – Part I

2016 Supply Chain Trends:
Top Supply Chain Trends 2016 – Part II

2015 Supply Chain Trends REVIEW
2015 Supply Chain Trends – In Review

 

 

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