During Manhattan Associate’s Momentum 2018 conference, my colleague Chris Cunnane, wrote an overview of the major announcements that Manhattan made. Manhattan Associates is a leading provider of supply chain software solutions. But the enhancements that Manhattan made in their warehouse management system (WMS) were both significant and interesting enough that I felt they warranted a deeper dive. The new solution changes the rules of automation.

The Logic in Existing Warehouse Solutions

A little background is needed to fully understand the import of the enhancements that were made. A warehouse management system allows a company to accurately fulfill orders while improving labor productivity. Labor productivity was driven by grouping orders into waves. A wave might be all the orders that will go out on the UPS truck scheduled at 10 am, or all the orders going to stores 1 – 5 which will ship on a truck at dock 6. These waves of work facilitated the intelligent grouping of orders fulfilled by a particular associate, which reduced travel time.

A WMS also contains logic for receiving goods, dock appointments, moving goods from storage to forward pick locations, value added services (like kitting), and all other end to end processes associated with warehousing.

When warehouses have advanced automation – like conveyors, high speed sortation, automatic storage and retrieval systems, and so forth – companies generally implemented both a WMS and a warehouse control system (WCS). The WMS contained the order fulfillment logic, the WCS the MOVE logic. MOVE logic looks to manage how a product is transported on automated systems from point A – for example, a pick location – to point B, perhaps a pack station or a shipping dock.

But over time, with the growth of ecommerce, another 3-letter acronym software solution was born – the WES (warehouse execution system). A WES most generally included both the MOVE logic from a WCS and some of the picking logic that a WMS has.

Some of the leading WMS solution providers had batch picking logic but lacked the logic to optimally pick ecommerce orders. Ecommerce orders are typically small, one or two items. And rather than batching these orders to gain labor efficiency, it often makes sense to drop these orders – or at least the orders that customers were promised would be delivered in a day or two – to the floor as soon as they are received. Thus, Ecommerce orders are fulfilled with something known as “order streaming” logic.

The slowness of leading WMS suppliers to respond to the growing need for optimized ecommerce picking, created the opportunity for WCS suppliers to reach up and grab this space. But it never made sense for “order streaming” logic to be supplied by WCS (rebranded as WES) suppliers, because order streaming is only one part of the end to end processes that need to be supported in a warehouse. Further, many warehouses need to perform both traditional fulfillment and ecommerce fulfillment, and WES solutions lacked the wave logic needed to optimally support traditional pallet and case fulfillment.

Changing the Rules of Automation

Manhattan Associates first announced that their WMS would be enhanced with order streaming at last year’s Momentum. At this conference, they announced a solution that might best be described as “order streaming on steroids.”

In orchestrating when ecommerce orders are dropped to the floor, WMS solutions have mostly operated with simple rules. For example, if an order needs to be delivered to a customer tomorrow, drop it immediately, if it does not need to be fulfilled for three days, wait two days before dropping it to the floor.

What Manhattan has done is to greatly enhance the orchestration logic with real-time awareness of the capacity of both men and machines, as well as the availability of the necessary inventory at the right location, to do a piece of work at a given time. Rush orders get dropped first, but better awareness that the system still has capacity available to fulfill orders that might not need to be shipped for a few days, means both equipment and people can be more fully utilized.

Fully understanding the capacity of the system to do work, in turn means that the system must understand at a very granular level how long it takes to do a given piece of work. When it comes to how long it takes a person to do a given task, Manhattan Associates has a labor management system (LMS) that already contains this logic. An LMS uses precisely determined standards to understand exactly how long a task should take based upon the distance to be traveled, where an item is placed on a shelf, and the size and shape of the item to be picked.  But implementing an LMS requires money and effort, and an LMS often does not include all the time standards logic needed to fulfill orders that involve material handling equipment.

Over time, as the capacity issues are understood, the system can use mixed integer optimization – the kind of optimization used in advanced production scheduling systems – to understand exactly how many orders can be dropped to the floor in the form of executable tasks.  While generating the tasks, the system leverages another optimization methodology called Adaptive Large Neighborhood Search (ALNS) which utilizes a robust distance calculation framework provided by the new Warehouse Map component.

Mr. Kline summed it up by explaining, “execution is constantly monitored by the planning component with the help of real-time signals on task statuses, worker availability, processing speed, and resource utilization.  This constant feedback is blended with carrier cut-off requirements and initial priority of orders Then heuristics (rules-based systems) are used to re-prioritize which orders are more and less important at a given point in time.” It may be that out of 500 potential tasks that could be worked on, based on the priority of the tasks and the capacity available in the system, only 50 are dropped to the floor. The other 450 orders are sent back into the order funnel engine for replanning once capacity becomes available. “Any new order arrival, or change in the execution state and performance, are factored into the new plan which results in an adaptive work planning process.”

Slide from Manhattan Associates’ Adam Kline (Sr. Director Product Management) and Aykagan Ak (Director Science R&D) Presentation at the Momentum2018 Conference

In conclusion, this is a significant enhancement employing advanced optimization techniques not generally seen in WMS solutions. Finally, it is my sincere hope that we will soon be able to stop talking about WES; the whole WMS/WCS/WES conversation is just too confusing.