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Andel and Handling: Had it Up to HERE?

Aug. 11, 2014
Good. At least you know your capacity. Now, let MH&L's Buyers Guide help you find a way to apply that knowledge to your supply chain.

You have a hard job and you're looking for ways to make it easier. That's the purpose of this Buyers Guide edition of MH&L: to be a sourcebook. How do we know your job is so hard? Our cover story about the State of Logistics counts the ways. While consumer demand for products and services rises with the promise of same- or next-day delivery that's just a click away, the capacity to deliver on that promise is shrinking. Hours-of-Service regulations are making it harder for carriers to find and keep truck drivers, therefore it's more challenging for manufacturers and distributors to make and keep service promises.

Those in material handling and logistics who can help their companies satisfy customers are heroes and are being paid heroically. Tom Moore, managing partner of Transportation | Warehouse Optimization, whose colleague Will Cotten contributed our story on fighting the "Hours-of-Service Effect," told me higher wages are the good news our readers can enjoy. The bad news is your job will continue to get harder unless you stay educated about the state of your art.

"I was at the University of Tennessee recently, talking to their logistics group, and I learned every one of their supply chain graduates either has a job or is going on for higher education," Moore says. "And according to their salary survey, for the first time this year supply chain grads are making more than people who have finance in their degrees. When I got into logistics I was a hero every day because I reduced costs every day. Now I feel sorry for the people in warehousing or transportation. They're also fighting truck shortages, prices are going up all the time, fuel costs are going up and there's no good news on their front."

There are companies investing in dedicated fleets because they can't get enough trucks. As a result they're paying for empty miles and, by doing so, further reducing capacity for everybody else. That makes it even more important to get a better handle on load planning and shipment preparation. Yet what goes on in the warehouse or distribution center is often more a function of tribal knowledge than problem solving. Things happen because "we've always done it that way." They thrive on linear thinking in a world that demands more logical reasoning. Linear thinking drives Moore nuts.

"I was in a meeting with a client and he said when they go out to pick an order the first thing they pick is the first thing they ship; nice linear order," he says. "That makes no sense because if the first thing you pick ships at 10 a.m. tomorrow, what if there's no inventory for it? And what if all the inventory that's going out at 11 a.m. is there? Wouldn't you pick the 11 a.m. shipment before the 10 a.m. shipment? But their software says 'here's the first one,' so they go out and do it that way. As a result the WMS becomes a warehouse accounting system; it doesn't do management."

Ultimately, management is your job, no matter what technology you apply. As Norm Saenz says in his feature on horizontal carousels, this technology is particularly well-suited to environments with space constraints and budget limitations. If the budget is not as much an issue and higher throughput is required, then mini-load and shuttle AS/RS technologies may be better alternatives. Capacity utilization is as critical inside the four walls as it is outside on the roads and rails.

Managing capacity requires visibility, and this edition of MH&L offers thought leadership on that too. In our feature from Elemica's Arun Samuga, you'll learn that DuPont plans to expand its visibility into multi-modal transportation operations (ocean, truck, rail, etc.) and to use predictive analytics to improve service level agreements, save inventory, improve forecast accuracy and reduce freight costs.

And our report on military clothing retailer Propper International shows how visibility helps it stay on top of inventory turns as well as profitability -- by SKU, by invoice, by customer and by sales territory.  This intelligence lets them make inventory adjustments while selling faster.

This Buyers Guide's combination of tactical, strategic and market information is dedicated to making your job easier throughout the coming months. We want to free up more of your capacity.