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‘‘Flexibility and agility are the words of the day’’

Sneha Radhakrishnan, Offering Manager, HONEYWELL.

Expert opinion submitted as part of the thematic dossier "The Agile Warehouse" (French translation available here)

What are the main developments warehouses have been facing in past months?

Warehouse and distribution centre (DC) managers are facing a rapid increase in demand for their services due to a surge in e-commerce business. Although it has risen over the last few years, the pandemic has put immense pressures on global logistics networks and a boom in e-commerce.

When businesses move from retail to e-commerce, the DCs which are geared towards retail replenishment will suffer, as they are primarily designed to handle cases or pallets instead of each picking products. Also, the exponential SKU count increase in DCs has led to more interest in automated DCs as many current material handling equipment (MHE) systems are challenged.

Why agility became a key factor in warehouse performance ?

Flexibility and agility are the words of the day when it comes to warehouse operations in light of the e-commerce boom. Warehouses have gone from being replenishment centres for retail outlets to complete distribution centres that cater to retail and individual customers alike.

A typical distribution centre today handles both customer types, each with their own requirements. The operations performed in a warehouse for an individual customer order is very different than a retail replenishment.

The DC must process the order, pick, sort, convey and pack an order out to individual customers.

Operators have less than 4 or 5 hours to complete this — and any mistake could cost them a customer. Individual customer requirements have also changed in the last few years with expectations of same-day delivery, free shipping and returns.

DCs are not only shipping goods out but processing at least 10% of their online sales as returns. This means warehouses/DCs are evolving constantly to meet customer needs and the industry is straining to catch up.

How to introduce agility in warehouses? What does Honeywell offer ?

For any warehouse, the traditional processes that were once in place do not meet the current and future requirements. For manual and automated DCs, the biggest bottlenecks in making a DC more agile have two parts to it: the hardware and software components namely, increasing conveying/sortation capacity, investory management, order fulfilment and labour management. A DC manager can ensure that their DC is ready for future needs by ensuring the optimisation of existing assets in brownfield sites and planning for an advanced and fully automated DC utilising a flexible software system for their greenfield sites.

When planning a DC expansion, factors such as labour and space must be taken into consideration, as they affect the response time of your warehouse to any orders through the day. Scaling your hardware system is done to meet various demands of the current business needs, such as same- day delivery, free returns processing and a vast inventory with quick turnover.

Honeywell can provide a variety of solutions that increase the throughput of a customer’s warehouse, either by updating their sortation systems or advanced software and controls. An example of a hardware upgrade to make a DC more agile would be where the DC is scaled up with a secondary sortation system to meet customer demand. The secondary sort can be temporary or permanent based on the warehouse’s seasonal/year-round demand.

In the current scenario, Honeywell leverages data to ensure that the customer has a connected DC and all operations are in sync with one another, ensuring peak efficiency. One such example of a more agile DC would be the shift from warehouse management systems (WMS) to warehouse execution systems (WES). Traditional warehouses using WMS have limited decision-making capacity through the day, when the orders are released in bulk and cannot be modified through the day as priority changes. A WES, however, can make decisions to expedite priority orders by taking into consideration various aspects of order fulfilment such as labour, workstation availability, picking and pick routes, and product travel routes. This makes your DC more agile to meet the needs of your customers.

Another factor that makes a DC more future-proof is its ability to plan for future labour demands. Labour management software (LMS) increases productivity in DCs and learns to predict the future needs of a DC based on the data it accumulates. This helps DC operators to be more flexible, both in the short run and long run when planning for daily operations and expansion, respectively. In the short run, temporary increase in labour needs can met with manual workers, whereas an increase in the long run can help expand a DC to a more automated one.

In addition to the systems mentioned herein, the material handling industry is fast deploying advanced mobile robotics to meet future needs. Automated mobile robots (AMRs) can be used in assisted picking, transporting and routing items within a DC. AMRs are helping DC managers to tackle labour scarcity and meet their daily operational demand, simultaneously maximising their productivity on tedious and repetitive tasks.

Bio Express

In her role as Honeywell’s offering manager, Snehalatha strives to establish the company’s products within the European market. She is responsible for growing Honeywell’s business presence in the region by becoming a reliable partner and meeting customer and market requirements.

Previously, Snehalatha worked for five years as a product manager within the energy industry. There, she worked to build new business development models for bringing in new customers, launching new products, and ensuring the offered product portfolios were relevant to market needs.

Snehalatha earned a bachelor’s degree in electrical and electronics engineering from Anna University in India, and a master’s degree in power engineering from Technical University of Munich. She is a member of the Institute of Electrical and Electronics Engineers (IEEE) and VDE.