Workflow Management Solutions

HighJump’s new VP of Sales, Jim Bork, was in my office the other day and asked me, “Why don’t more people implement our Yard Management solution?” After hearing a customer case study at Innovation 2009, HighJump’s annual user conference, where the customer claimed benefits from yard management in excess of $1 million, Jim wondered why all of our customers wouldn’t leverage this technology. As I started thinking about this question, I realized that maybe companies are looking at the wrong business case for yard management.

What is Yard Management?

Yard management is a kind of supply chain logistics software solution that tracks trailers and containers in a yard outside of a manufacturing facility, warehouse or distribution center. Using workflows, the software can support the following activities:

·         Driver check-in or check-out including collecting all relevant data from the driver and tying the arrival to a specific dock appointment

·         Optimized storage of trailers or container within the yard. Trailers with “hot” product can be moved directly to dock door locations. Other trailers can be dropped in the yard for unloading in the future.

·         Visibility to trailer aging is provided so companies do not incur demurrage charges for holding a trailer in the yard for excessive time periods. (Trailers and containers are typically owned by a 3^rd party and holding them for too long can trigger a charge called demurrage).

·         Optimized work instruction is provided to yard drivers for moving trailers to and from dock door locations.

Work Optimization – The Old Thinking

Yard management provides benefits on multiple levels, however, most supply chain management professionals first think of the work optimization as the primary benefit. Work can be optimized creating labor savings and more efficient flow of inventory. However, if you “run the numbers” on a typical yard, labor savings alone will not drive a strong ROI on a labor management system.

The Safe Thinking

Safety and security has become a primary concern for many businesses in light of focus on national security in many countries.  A yard management solution will also provide benefits in the area of safety and security. Yard management systems help facilitate a single point of entry and exit from the yard. Additionally, a yard management system will systematically collect information about specific loads that could be used to comply with internal or homeland security requirements. While safety and security are important it is difficult to build a hard business case around these factors.

Inventory Optimization – The New Thinking

Companies with the most successful yard management initiatives find ways to optimize inventory across the yard, manufacturing facility, and distribution center. As companies in the US and Western Europe are transitioning from manufacturing-centric to distribution-centric, inventory in the yard has become a serious issue. Import-centric supply chains leverage low cost of materials and product, but suffer from long lead times and product obsolescence. Often this results in large amount of inventory being held in containers in the yard.

The best way to build a business case for a yard management system is treat your yard like an inventory buffer. An inventory buffer in the yard will allow many companies to carry additional inventory without facility expansion in their distribution center.
An additional inventory buffer provides significant benefits in terms of supply demand matching and perfect order performance.

HighJump has one yard management customer who drops orders to the warehouse for fulfillment even when the expected inventory only exists in the yard. This means they must coordinate a trailer move of inventory to the dock door, cross dock the needed product, and marry it with the other product required for the customer’s order. Clearly, this logistics capability is something to build a business case around!

So before taking your yard management system business case to the corner office, ensure you have considered all aspects of intelligent inventory positioning and supply chain management best practices that can be gained from a yard management system.

As I begin blogging, I hope my thoughts are useful to some you out there.  The power of the internet is the transactions and interactions that it creates.  This is where collaborative magic happens and I look forward to the conversations and feedback that are created.

In working with literally hundreds of customers over the last 20 years in the IT business, I see a similar problem all of the time.  People invest a great deal of time and money to implement new state of the art technology so that they can be leading edge and then spend an equally staggering amount on making it do what they do today.  The argument is often cloaked in well founded arguments around how the processes they have are working and don’t need to be changed.  The horse and buggy, quill pen and typewriters all worked as well.  This approach is particularly evident when organizations are changing their direct store delivery software and route accounting systems.

When we dig into it, we find that a lot of the processes we see in the field are created due to physical limitations that were caused by data only being communicated when field representatives returned to the office or the physical passing of paper.  With wireless communications and real-time information those limitations are gone.  This creates the opportunity to rethink some of those basic assumptions. If we receive orders in real time, do we really need to wait until tonight or tomorrow to pick them?  If the inventory is already on a truck that is nearby, can’t we just dispatch that truck and call it done? It is really about using our workflow management solutions to change the way we work.  Fax machines were state of the art less than 20 years ago.  Wireless technology is changing the way customers want us to serve them.  The real question is, will we keep up and create the opportunities that grew our traditional businesses in the first place?

Image via Flickr user Beaverton Historical Society.
 

I recently met with one of our large 3PL customers from China.  Among other things, we discussed the product roadmap and importance of a localized application.  This reminded me of a trip I made to Taiwan which clearly demonstrated that localization considerations go far beyond just supply chain software solutions. 

In the streets of Taiwan there are hundreds of scooters.  On any given corner there could be literally tens of scooters waiting for a green light.  This adds another level of complexity to driving a car in the streets of Taiwan since even a slight shift in direction could send a scooter flying, causing serious injuries as a result.  Many car manufacturers have localized cars to have sensors on the four corners of the car.  If a scooter is close to the sensor, the driver is alerted to their presence even if the driver cannot see the scooter.  While this does not eliminate accidents, it greatly reduces them. 

Correctly localizing supply chain logistics software can also eliminate accidents in your operations and help keep costs low.  When the topic of localization is brought up, we generally think outside the United States, but even in the United States it is commonplace to have a multi-lingual workforce where upwards of five languages are spoken.  Workers who can operate in their native language are much less likely to make errors and generally have higher productivity because they don’t constantly have their own internal translator processing every prompt.  HighJump Software WMS Management solution has been translated and localized for over 10 languages including simplified Chinese and Japanese.  On your next software project, don’t underestimate the importance of localization.

Image via Flickr user The Kozy Shack

If you read any publication about application software, you will hear the term SaaS (software as a service). As the momentum for SaaS builds you might expect all supply chain logistics software to be offered in a SaaS model. Does that make sense? As with many good ideas, the hype builds so that people think the solution can be used to address any kind of problem, but this can result in the proverbial square peg for a round hole. SaaS is already proven in CRM and makes a lot of sense for Transportation Management solutions since you get a network effect by already having several carriers integrated. However, one of the core tenants of SaaS is a multi-tenant architecture with everyone running on the same software. This typically results in more simplistic less configurable applications. 

Could the SaaS approach work for WMS solutions? I have visited several warehouses and they are all different physical configurations. Even within the same company each warehouse has a unique configuration of dock doors, shelving, material handling, workers skill-sets, and space requirements. This uniqueness generally drives unique business process flows to optimize the flow of goods into and out of the warehouse. While some vendors have started offering WMS solutions in a SaaS model I believe it will be very challenging to manage the heterogeneity of requirements that are inherent in many companies’ distribution operations yet adhere to the core tenants of SaaS. While the time may come, SaaS is still the square peg to solve the WMS round hole.   

HighJump Software today announced it has achieved integration validation with Oracle’s PeopleSoft Enterprise Supply Chain Management (SCM) 9.0 for both HighJump Warehouse Advantage and HighJump Data Collection Advantage. HighJump Software has maintained a strong relationship with PeopleSoft and Oracle for more than 10 years by providing integrated manufacturing data collection, inventory and warehouse management solutions for Oracle’s PeopleSoft Enterprise SCM products. This relationship has resulted in more than 80 joint customers.

About 24 months ago at our midyear sales meeting I unveiled HighJump’s strategy to more aggressively target logistics service providers with our supply chain management software solutions.  The reaction from the sales team was mixed.  Logistics service providers are notoriously highly variable sales processes because the system purchase is typically tied to the acquisition of a new client for the logistics service provider.  The market data supported our strategy.  Use of logistics service providers is increasing worldwide as more companies outsource all or a portion of their logistics capabilities.

Times have changed.  The sales team now loves this strategy as logistics service providers are turning to HighJump Software for their supply chain logistics software.  The most recent logistics service provider to select HighJump is Cresent, a leading logistics outsourcing partner for a number of consumer goods companies.  Read the HighJump news release regarding Cresent.

HighJump WMS Warehouse Management System will automate many of Crescent’s previously manual warehouse processes and optimize the movement of goods throughout Crescent’s distribution centers, boosting productivity and inventory accuracy. The system will also enable the company to meet customer traceability requirements for batch and lot code tracking. Crescent will also be able to interface to customer ERP systems, a requirement that often previously hindered new business wins. The company will utilize HighJump’s Manufacturing Execution System Software in its co-packing operations, where it assembles product multipacks and builds product displays.

Why are so many logistics service providers turning to HighJump Software for their supply chain logistics software?  Here are few of the contributing factors.

Billing Management
HighJump Billing Management helps ensure maximum revenue and minimal billing cycle time by enabling activity-based billing of each client according to their distinct attributes. Appropriate charges are automatically generated for storage of goods and any other services you perform as a logistics services provider.
HighJump Billing Management’s capabilities extend far beyond billing and reporting. This comprehensive solution can also help make your business more attractive to current and potential clients by enabling you to offer more value-added services, superior inventory control and overall cost reduction—making you stand out in a commoditized logistics marketplace.

Dynamic Inventory Attribute Tracking
Logistics Service Providers have complexities of handling a variety of products with complex tracking requirements.  The same facility may manage perishable products that require best before date tracking, apparel that requires style color size tracking, and electronic products that require serial tracking.  With HighJump WMS Solutions all these attributes can be tracked in the same inventory model.  In fact, as the logistics service provider encounters uncommon data tracking requirements they can configure the solution to track these inventory item attributes.  Additionally any of these attributes can be shared with end clients through inventory visibility portals.

Integrated Transportation Management
Many logistics service providers in traditional public warehousing or in contract warehousing are branching into managed transportation services.  HighJump Software provides a transportation management solution used by many logistics service providers and is fully integrated with WMS warehouse management system.  The TMS support management of buy-side and sell-side contract rates allowing a logistics service provider to manage rates for contract carriers and separate rates for the price they sell the transportation service to their end client.

Flexibility to Meet the Changing Needs of Clients
The most important business differentiator for a logistics service provider is flexibility.  Existing clients frequently have new requirements and winning new business often requires changes to the operations and supporting systems.  HighJump has developed an out-of-the-box rules based architecture to allow logistics service providers to create unique rules that influence how a process works in the warehouse.  The rules can then be assigned to a client, an item, a vendor, or any attribute within the WMS warehouse management system.  Additionally if a standard rule cannot meet the specified requirement, a new rule may be created using Advantage Architect, HighJump’s workflow management adaptability tool.