The rise of e-commerce was a significant change for supply chain managers and leaders. Customers now have access to anything their hearts desire, and inventory management has become a new animal.
The right application of warehouse management analytics can enable significant growth for companies, forced to focus on smaller package sizes, not the pallets and cases of the past.
Supply chain leaders need to understand the flaws of traditional warehouse management styles, the benefits of warehouse management analytics, and follow a few best practices to use them to their fullest potential.
Why Do Analytics Overwhelm Supply Chain Leaders?
Analytics can be complicated. They require the ability to track information, understand from where this new information is derived, and connect disparate bits of data to arrive at new insights. At the same time, today’s supply chain leaders were not trained in the age of data efficiency and application; they were focused on moving larger quantities.
Data scientists are one of the fastest-growing positions on the planet, reports Supply Chain 24/7, and many organizations do not know where to begin when it comes to analyzing data. Traditional warehouse management styles focused on moving a relatively small number of different SKUs, which were palletized or in cases, from manufacturer to distribution center to reseller and to customer.
Obviously, there was some wiggle room in the model as home shopping through TV came to light. However, that was only a fraction of the surge in small orders that have occurred through e-commerce.
Benefits of Warehouse Management Analytics
There are several types of warehouse management analytics and warehouse management KPIs, reflecting the ongoing process optimization in today’s supply chains. The use of warehouse management analytics can be broken into five broad categories, including:
- Better marketing efforts. Knowing more information about your customers allows for the continuous refinement and targeting of customer needs through online and in-store experiences.
- Merchandise optimization. These analytics help supply chain leaders understand how to layout inventory across all shipping channels to maximize purchases.
- Adjustments within the supply chain. As e-commerce grows, more customers will come from emerging markets in areas where an established supply chain is limited at best. As a result, supply chain leaders will need to enhance their existing supply chain processes to enable a broader distribution network.
- Enhanced store operations. The idea of buy online and pick up in-store (BOPIS) can leverage supply chains in two ways. It can involve items shipped from a distribution center to the store for the customer’s pickup. Alternatively, they can use the existing brick-and-mortar staff as “pickers” to fulfill more orders. As a result, the brick-and-mortar store sees higher profitability from faster inventory turnover.
- Improved cybersecurity. Using analytics to test company programs, platforms, and firewalls continuously, for penetration or vulnerabilities, is an excellent way to enhance cybersecurity of your supply chain, while still tracking information to improve overall operations.
Best Practices in Implementing Warehouse Management Analytics
Supply chain leaders that wish to apply analytics in the warehouse need to redefine the definition of a warehouse. In today’s world, warehouse management can involve the management of distribution centers, brick-and-mortar stores as a fulfillment center, localized e-commerce fulfillment centers, and more.
Even the inventory in the yard will require an additional level of management and control. Thus, leaders should follow a few best practices to ensure that nothing is overlooked.
- Recognize the needs of your facilities, such as space.
- Identify possible system vendors.
- Think outside of the box when looking at analytics in the warehouse, including any activity or process that can be tracked in some way.
- Leverage automation during system configuration, testing, and ongoing maintenance.
- Take advantage of microservices that allow for the “testing” of new services, functions, or capabilities.
- Connect all data aggregators to analytics platforms.
- Consider partnering with a supply chain systems integrator to ensure analytics are used to their fullest potential.
Deploy the Right Warehouse Management Analytics to Save More and Manage Resources Effectively Now
The right analytics strategy in your warehouse and supply chain will be a real game-changer. However, the relative nature of analytics means it can be challenging to get started. For assistance in discerning where to begin, choose an expert in warehouse management.