Maximizing Your Investment in Supply Chain Digitalization

Not long ago, deploying innovative technology solutions and automating supply chain processes required large capital investments based on multi-year ROI projections. Sometimes those digitalization investments paid dividends, but often, the systems deployed were unable to adapt to business or market changes and effectively became obsolete before a return could be realized. This was just one of the risks organizations had to navigate when moving forward with supply chain automation initiatives.

Today, many of the risks associated with digitalization have been reduced, and it’s easier than ever to maximize the value of supply chain technology. Here are some of the innovations making this possible:

Increasingly mobile and flexible solutions: Supply chain automation is more flexible and mobile than it was in the past, and these improvements take much of the risk and disruption out of technology deployments. Today’s autonomous mobile robots work with existing warehouse infrastructure to improve productivity, and they can be deployed quickly, scaled easily and repurposed to other facilities if requirements change. Even fixed solutions, such as some goods-to-person picking systems, offer greater flexibility than previous technologies through modular designs that increase storage capacity or throughput with minimal disruption.

As-a-service financial models: The flexibility of the current generation of digitalization solutions has enabled new financial models that minimize the upfront investment required to introduce new supply chain technology. Rather than making capital investments in the latest robotics or other innovative technology, organizations can contract digitalization and automation solutions as a service. Bringing this common software model to hardware reduces the cost of new technology to be paid as an operating expense. It also ensures that your organization isn’t burdened with unwanted technology if needs change or new solutions become available.

New business drivers: The task of calculating solution payback periods based on potential cost savings may seem almost quaint if you’re struggling to attract and retain the labor required to maintain day-to-day operations. In that event, the business case for digitalization is all about increasing the value and efficiency of limited human resources, and today’s solutions can accomplish that goal. New technology should be expected to deliver meaningful cost savings, and if a solution can cut the need for peak season labor in half, that may be sufficient justification to move forward, especially considering the limited investment enabled by the as-a-service model. When appropriate solutions are implemented, the efficiency and productivity improvements that can be achieved represent “found money.”

From change-hesitant to technology advocates

Today’s workforce is increasingly receptive to and excited by the opportunity to work alongside robotics and automation technology. There is widespread recognition that organizations face significant challenges in filling open positions—making clear the role that innovation can play in alleviating that stress on an organization and its existing workforce.

Today’s supply chain automation solutions are designed to make the jobs of logistics and warehouse workers easier, and can enable skilled labor to focus more on strategic tasks and learning new skills, increasing their value to the organization and supporting their professional development. Autonomous mobile robots and innovative goods-to-person solutions, for example, can save item pickers miles of walking every day, leaving them less fatigued. Boston Dynamics’ Stretch robot even automates the trailer unloading process, improving worker safety by taking over physically demanding tasks.

Many of these solutions use intuitive touchscreen interfaces similar to those used by employees in their personal lives, so the technology they learn on-site is familiar, rather than intimidating. As a result, deploying new technology no longer comes with the risk of alienating employees. Instead, integrating these solutions into operations is helping to attract and retain talent in a tight labor market.

3PL access to multi-vendor expertise

The final barrier that has been removed is the need to qualify and manage multiple technology vendors. Third-party logistics providers (3PLs), such as DHL Supply Chain, have taken a leadership position in advancing the digital supply chain. DHL offers the rare blend of supply chain and technology expertise required to operationalize and optimize warehouse technology, and its established relationships with vendors span the full range of supply chain digitalization solutions, including proven processes to qualify vendors.

Deploying technology through a 3PL also streamlines management and increases accountability. With a single partner responsible for all aspects of deployment, your people are never in the position of having to determine responsibility for any issues that may arise.

Supply chain digitalization has become a necessity, and much of the risk associated with introducing this technology has been removed. More flexible solutions, new business models and experienced partners are all paving the way for supply chain organizations to maximize the value of their technology investments.

Learn more about how DHL Supply Chain can partner with you.

Author: Sally Miller, CIO, DHL Supply Chain North America