May 06, 2013
It’s a Big Data world as information about material movement becomes more essential to the art of materials handling.
And, software applications designed to grant visibility into products, processes and pieces of equipment have grown accordingly.
Based on the results of Modern’s 2013 Software Usage Survey, many readers have big plans for improving information systems or rolling out their first attempts at detailed data collection.
Peerless Research Group (PRG) recently surveyed subscribers of Modern as well as a sample of recipients of our e-newsletters, and with 405 qualified respondents, this year’s survey represents the perspectives of more than twice as many materials handling professionals as in recent years.
“Those who have succeeded have benefited from the convergence of information systems, as businesses recognize the value of a holistic view of supply chain management”John Hill, director at St. Onge
According to John Hill, director at St. Onge, the broader respondent base has impacted the results and in many cases brings the survey’s data more in line with overall industry trends.
Hill notes some important themes highlighted in the data. “It seems many who have not seen a return on investment from their software implementations might not have done due diligence in creating upfront justifications and objectives,” says Hill. “Those who have succeeded have benefited from the convergence of information systems, as businesses recognize the value of a holistic view of supply chain management.”
Software, innovation and spending
The results of this year’s survey clearly reflect the importance of materials handling software to our readers. Nearly 43% of them report their use of such systems has increased in the last two years, while 52% said their use of materials handling software has stayed the same. Fewer than 5% said it has decreased.
The survey first asked readers to characterize their companies’ adoption of materials handling technology. Last year, 16% of respondents admitted they were among the last to adopt technology, while only 9% considered themselves innovators.
This year, just 11% are slow to adopt, while 12% feel they are leading the way. In the middle of the curve, readers who reported their companies “cautiously embrace change” fell from 46% last year to 44% in 2013. Those who pledged to take a wait-and-see approach grew from 15% to 19%.
Despite any hesitancy suggested elsewhere in the survey, when asked about spending predictions, readers expressed plenty of intent to buy. Of those who plan to spend on supply chain software in the next 12 months, the average anticipated spending increased from about $400,000 in 2012 to $572,000 in 2013. In 2013, 13% plan to spend $1 million or more, including 3% who plan to spend more than $5 million. About 46% of respondents plan to spend less than $100,000.
In this economy
When asked how the economy is impacting the adoption of materials handling technology, 18% of readers said they plan to move forward with new software investments this year. That’s down significantly from last year’s 27%.
It seems many have decided to hold off on software investments this year. For the last two years, just 20% of readers said they would hold off, but this year the number spiked to nearly 27%. Of course, it is possible that some of these respondents pulled the trigger on software plans last year and are now waiting for those initiatives to bear fruit.
At 17%, a full 5% more than last year, many readers have decided to upgrade existing software rather than buy new software packages. A growing number (8%) also plan to outsource software implementations, up from 5% in 2012. For those readers who license software, there are four different approaches to implementation.
As with last year, in-house staff is most often tasked with some part of this responsibility (69%), while 36% work with the software supplier. Systems integrators are brought in for 26% of installations, while 18% go with a business management consulting firm.
About the author
Josh Bond is Senior Editor for Modern, and was formerly Modern’s lift truck columnist and associate editor. He has a degree in Journalism from Keene State College and has studied business management at Franklin Pierce University.