I am currently wrapping up the most recent version of ARC Advisory Group’s annual research on the global warehouse management systems (WMS) market. The report is scheduled for publication in late May. As part of the research process, I ask WMS suppliers about their planned product enhancements for the next two years. I also inquire about how they anticipate WMS customer and prospect requirements to evolve over the next five years. The process generates a wealth of information on product development initiatives, some with a great deal of overlap across suppliers, and others more unique. I will try to capture the “essence of the essence” of that feedback in this Logistics Viewpoints post.
Driving Forces Behind WMS Product Development
WMS is a mature application software category, and the established providers offer functionally rich solutions. Therefore, the needs of established clients drive incremental enhancements, while competitive pressures contribute to total cost of ownership improvements. At the same time, changing fulfillment requirements (e-commerce) and information technology and automation advances are the driving forces behind more broad-based product development and enhancement efforts. And many recently launched and forthcoming product enhancements are driven by a combination of these factors.
Big Data and Better Decision Making
The exponential growth of data being generated by sensors, automation, and other “things” is being recognized as an untapped source of insight that can be utilized to improve decision making in business and consumer applications. Think about consumer mapping applications such as Waze, as an example. GPS has been available for decades, as have routing applications. It is the combination of these two technologies, along with the wealth of real-time data points that have allowed Waze and similar applications to provide real-time traffic data, estimated commute times, and more efficient alternative routes. The increase in real-time data within the warehouse, along with the long-established data sources and application capabilities is being similarly recognized for its potential. WMS providers are investing in business analytics, optimization capabilities, and machine learning to allow their customers to harness this data to make more informed, optimal, and timely decisions. First and foremost, WMS providers are applying machine learning to deliver the next step in performance improvements. As an example, Manhattan Associates’ Order Streaming applies machine learning to predict the time required to complete work. Similarly, JDA Software recently released its Luminate Warehouse Tasking application that employs machine learning to deliver near real-time task prioritization. HighJump and others are also focused on applying machine learning to deliver more informed warehouse decision-making.
Warehouse Automation is Here, There, and Everywhere
Warehouse automation adoption is increasing at a rapid pace. I know this from anecdotes, publicly available information, and from ARC’s study on the global warehouse automation market. Automation is a practical investment for many warehouses in today’s markets that feature tight labor and thin profit margins. The proper automation investments can help assure fulfillment capacity and allow companies to reduce the variable costs of fulfillment. WMS providers are aware of the expanding use of automation and robotics within the warehouse, and in response, have prioritized their WMS investments to accommodate these customer needs with an integrated solution.
Warehouse control systems (WCS) provide real-time integrated control and coordination of automated resources, equipment traffic, and material flows within and across the facility. These systems are critical for the proper management of automated facilities. HighJump launched its warehouse control system (WCS) last fall. The HighJump WCS was a development made possible through collaboration with Inconso, its sister company in the Koerber Logistics Systems business. Manhattan Associates also recently launched its warehouse execution system (WES), a system that contains both the business domain of a WMS as well as the control and coordination of automation. Other WMS suppliers have also noted their plans to develop and provide more integration plug-ins and standard APIs for automation systems and robotics. In general, WMS providers understand that automation is increasing in prevalence and importance, and their ability to integration automation with WMS will extend their value proposition.
Warehouse Management Functionality
Warehouse labor management, workforce management, and yard management are the WMS functional categories that were most frequently mentioned as product development initiatives. For example, Oracle WMS Cloud v9.0 includes new yard management functionality. Also in 2018, SSI Schaefer launched its Labor and Resource Management System (WAMAS LRM) and Knapp launched redPILOT, its integrated labor and resource management application.
Rounding out the major categories of investment were the perennial usability enhancements, cloud deployment enhancements, and numerous mentions of RESTful APIs and web services. Ease of integration, interoperability, extensibility, and reduced need for customization were the prevailing themes. Of course, these capabilities reduce total cost of ownership and break down barriers to adoption. Stay tuned for more insights from ARC’s research on the WMS market.