Right now, we’re in one of the most challenging times that we’ve seen for many warehouses, but it’s also a time of tremendous opportunity.
In the past two years, 9 in 10 warehouse operators cited average shipping volume increases of 23% in business-to-business fulfillment, with almost as many seeing the same increase for direct-to-consumer shipments. Manufacturer drop-ship volumes have also been climbing, growing by 22% on average.1
All those increases represent dramatic growth, and despite rising inflation and concerns about the prospects of a possible recession, decision-makers across sectors continue to expect growth over the next few years. In fact, 83% of warehouse operations say they expect to see an increase in volume of items shipped over the next three years, and 82% say they anticipate an increase in the number of SKUs they need to maintain.
Even if we see a decline in growth, many warehouses still need to catch up and adapt to the rapid changes we’ve seen over the past two years. Virtually everyone is looking for ways to increase efficiency, maximize labor productivity, and manage costs.
That brings us to the issue of warehouse modernization, which has become an ongoing process for many of our customers at Vantage ID. With the permanent shift toward e-commerce and an increasingly omnichannel business ecosystem, warehouses are having to digitize, automate, and modernize their operations in order to supply businesses and consumers with the right inventory and with faster on-time delivery.
However, it can be difficult to figure out the best ways to achieve that and which steps to take when you’re already in the midst of higher demand and struggling to keep up, especially with recent labor shortages and rising wages. That’s why we’ve been working closely with warehouses to provide strategic guidance, help them quickly identify where they are and where they want to be, and determine which process changes, technologies, and tools will help them get there in the fastest and most cost-effective way.
One way we do this is with the Warehouse Modernization Model from our warehouse technology partners at Zebra.
The model is a five-phase framework that breaks warehouse modernization into manageable pieces guided by bigger-picture strategy as well as longer-term goals.
Depending on where you are in the framework, and which phases you’ve already passed through or are working on right now, it serves as a high-level guide to where you are, where you want to be, and how you can get there.
Here’s a quick look at the model through a condensed reference diagram:
At the core of the diagram are the five numbered phases of the model, located in the lower middle. For each phase, there is a corresponding concept arranged in each of three categories: Sense, Analyze, and Act.
The idea is to identify where your warehouse is today and where you want to be in terms of these phases and the capabilities indicated under those three categories of Sense, Analyze, and Act. In many cases, you may be in phase 0, shown all the way to the lower left of the diagram. In that case, you may first need to work on getting to phase 1.
Once you’re there or you’re in one of the other phases, you can use the diagram layers to get a sense of your current capabilities and what you’ll need to work on to get to the next phase.
In the Sense layer, we find methods that will enable you to sense what is happening in your operations by collecting the right data. This includes using data capture, tracking and sensing technologies such as barcoding, wearable or voice-directed solutions, sensors, location and tracking technologies, and intelligent automation.
In the Analyze layer, we find what sort of data or information you’ll be able to analyze once you’re able to Sense it.
In the Act layer, we see the actions you’ll be able to take and the improvements you’ll be able to achieve based on what you’re able to Sense and Analyze. This ranges from goals such as gaining basic control of your business operations and achieving real-time visibility to achieving predictive and adaptive operations.
At the bottom of the Sense, Analyze, and Act layers, we see that they’re ultimately all connected to Worker and Workflow Optimization. At the end of the day, that’s what’s going to allow us to achieve our goals.
Around the entire diagram, we find a layer labeled “Automation” and “Warehouse Management Systems.” Those are foundational elements that will enable much of what we want to achieve by helping us collect and analyze sense data, manage operations, and automate workflows and processes.
We’ve used this model as a basic framework and guide to help our warehouse customers figure out where they are today, visualize where they want to be in the coming months and years, and determine some of the key strategic moves they might need to make to get there.
If that’s something your warehouse is struggling to figure out, or if you’re simply too busy and overwhelmed with day-to-day demands to tackle it on your own, our experts would be happy to provide free consulting, advice, and help to walk you through the process.
Contact us now to learn more and schedule a discovery call, and let’s talk about how we can help you adapt to growing demand and take advantage of today’s and tomorrow’s opportunities.
- Zebra 2027 Warehouse Vision Study: Dynamic Markets Demand Warehouse Agility