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Supply Chain Execution Software

A look at what’s going on under the hood and shaping the supply chain execution space in 2016—and beyond. By Bridget McCrea




Charged with orchestrating behind the scenes movements like warehouse, labor, yard/dock, transportation and global trade management, supply chain execution (SCE) software continues to play a critical role in today’s overall supply chain processes. Folded under the umbrella of supply chain management (SCM), along with supply chain planning (SCP), SCE focuses on execution-oriented applications that carry out the plans created by those planning systems.

Because they play such an important role in the smooth running of the modern day distribution center (DC), SCE solutions are continually being honed and finessed to meet the needs of those operations. “Within transportation management systems (TMS) and warehouse management systems (WMS), in particular, we continue to see a steady stream of new developments, functionalities, and capabilities,” says Steve Simmerman, senior director of sales for JDA Software.

Simmerman says two of the newer developments are intelligent fulfillment and profitable fulfillment, both of which are being driven by the “Amazon effect” on the supply chain. Simply put, everyone wants to know where their orders are going to ship, how the shipping process will work and when the goods will get to their intended destination. A phenomenon in both the business to consumer (B2C) and business to business (B2B) realms, it’s pushing software developers to come up with new ways to help their customers meet those demands.

This, in turn, is driving companies to think more carefully about how profitable and intelligent their fulfillment strategies really are. “The consumer-centric supply chain has shifted demand signals and is dictating the flow of goods across the chain,” Simmerman explains. “It’s also wreaking havoc on a lot of existing systems, particularly at the manufacturing level.” To address some of these pain points, Simmerman says JDA has expanded its mobile capabilities, created tablet-based applications and incorporated location- and device-aware responsiveness into the mix. With these SCE tools in hand, companies can more effectively address the Amazon effect.

Simmerman expects intelligent fulfillment and planning to grow in importance over the new few years and says companies are eager to implement SCE technology that helps them meet their customers’ demands. “Right now, companies are finding ways to justify investments in any type of technology that can help them reduce their costs, drive their bottom lines, and improve profitability,” he says.

Key market drivers

According to Gartner, the SCM market is on track to reach $16.3 billion in sales by 2020—an increase of about 9.5% annually over the next four years. Driving much of that growth are companies that need better internal and external visibility, as well as those that need to upgrade or replace aging systems in order to gain new functionality. The same top five market leaders have dominated the list since at least 2012, with SAP, Oracle, JDA, Manhattan Associates and Epicor leading the pack.

The growth of Cloud-based WMS, market growth in Europe and Asia (“where vast numbers of manual warehouses are still operating like we did in the 1980s,” says Dwight Klappich, Gartner’s research vice president), an uptick in warehouse and DC automation, and growing demand for distributed order management (DOM) solutions are all helping to drive the WMS market. On the TMS side, Klappich says that the growth of solutions for the mid-size shipper, increasingly global supply chains, and the ability of a TMS to tap into the power of transportation providers are some of the key market drivers.

Adam Kline, director of product management at Manhattan Associates, says SCE software is also helping shippers solve distribution specific issues that the solutions may not have addressed—or had to address—in the past. For example, the company that needs to be able to get workers up and running quickly during peak times—or that has folded its online and offline fulfillment under a single roof—can use waveless picking, order streaming and something that Kline refers to as “frictionless flow” to achieve its goals in those areas.

“We’ve developed some features in our WMS to really meet those needs head-on,” says Kline. A new mobile-picking app, for example, allows companies to use ruggedized smartphones to get temporary employees up and running quickly during peak times, even if those workers don’t know how to use a traditional radio frequency (RF) device or scanners. “The applications include large icons that are easy to find,” says Kline, “and that walk new users through the picking process in plain English.”

Manhattan also recently introduced a new pack station user interface that displays full-item images in order to ensure order accuracy. According to Kline, the new stations can be used to print all required shipping documentation, including packing lists and labels, thus facilitating easy order completion and shipping. “This makes it very easy for a new associate to walk through the process,” says Kline, “and to become productive very quickly.”

Kline says mobile SCE applications are also helping companies “flip the ratio” on the amount of time supervisors have to spend out on the floor helping employees. Using Manhattan’s DM Mobile solution, for example, supervisors can effectively coach and mentor workers, monitor their progress and make sure they’re doing the best possible job. “When managers can spend 80% of their time on the floor and just 20% at their desks, rather than the other way around, you help them power up their teams and improve productivity,” Kline says.

More visibility, please

Fundamentally, the activities that take place within the four walls of the warehouse or DC haven’t changed much in the last 10 years. What has changed is the level of automation that’s being infused into those spaces and used to ensure a faster and smoother experience for the customer, and a more efficient and profitable one for the company itself.

“We still see some manual functions in place, but we’re also seeing a lot more automation,” says Satish Kumar, VP of client services and technology at Softeon. “Companies are trying to handle as much product as possible with the least number of people, and for the lowest cost per unit.” The same firms want the capability to scale up and down quickly to meet seasonal demands while gaining processing power—a goal that’s hard to attain using legacy software systems.

To help customers meet these demands in the most efficient possible manner, Kumar says software developers are making applications that can be used on $150-$200 Android tablets (vs. the $2,250 cost of a typical RF scanner). They’re also developing SCE applications that can be used in the Cloud, incorporating more pick-to-light systems and utilizing distributed order management (DOM) solutions that provide higher levels of visibility both in and out of the warehouse.

“DOM helps companies understand where their inventories are, figure out the best way to source products and see inventory as it moves from Point A to Point B,” says Kumar, who expects SCE applications to incorporate even more analytics, key performance indicator (KPI) tracking and visibility tools in the future.

Think global

Within the global trade management (GTM) sector, Nathan Pieri, chief product officer at Amber Road, says the company is focused on taking information from its in-transit visibility solutions and using it to determine how well carriers are meeting their service level agreements (SLA). Fed into a rate management solution, that information helps the GTM optimize transportation and create routing guides. This is yet another example of how SCE-based analytics is helping shippers make better, faster and more profitable supply chain decisions.

Pieri says the company is also developing global trade solutions that “move the decision point further back in time.” In other words, rather than waiting for an alert to decide how to book a shipment at the last minute, supply chain and logistics managers can use forecasts generated by a GTM (that can monitor work progress within a factory, for example) to take advantage of freight consolidation opportunities across multiple factories. “This gives companies an extra week to two to explore those opportunities, improve their yield factors and optimize their freight,” says Pieri.

No end in sight

As companies continue to hone their consumer-centric strategies and compete with the likes of Amazon, expect to see SCE vendors stepping up to the plate to develop systems that help their customers meet and exceed those goals. Whether they’re offering their systems in the cloud, providing mobile capabilities or layering in new analytics capabilities, these vendors all have their eye on the same goal: Helping companies work smarter, better and faster in an ever-changing distribution environment.

“The level of innovation we’ve seen in SCE over the last few years—and particularly in terms of the user interfaces (UIs), analytics and machine learning—has been pretty amazing,” says Simmerman. “We don’t expect that to end anytime soon.” 

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About the author
Bridget McCrea, Editor
Bridget McCrea is a Contributing Editor for Logistics Management based in Clearwater, Fla. She has covered the transportation and supply chain space since 1996, and has covered all aspects of the industry for Logistics Management and Supply Chain Management Review. She can be reached at [email protected]







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