Integrating mobile devices into supply chain management

– Leaning down the supply chain: implementing processes and solving problems faster

– The potential for new software & mobile technologies: what is available?

Phil MorganeCommerce and Omni-Channel Retail ConsultantThe Playhouse Group

The market only 10 years ago

• Dedicated item scanners and dedicated RF networks required tens if not hundreds of thousands of dollars in investment.

• Label printers and terminals were all fixed to a desktop computer, away from the fulfilment floor.

• Solutions were subject to the limitations of software to what was already created on a proprietary basis.

• What would have been the cost of a bespoke solution?

Enormous.

A brief technology history lesson

• Many great technological developments come as a by-product of other means.

• WW2 led to the accelerated development of the jet engine & synthetic rubber amongst other things.

• Space exploration let to consumer by products such as Satellite TV, GPS, Laptops and Non-reflective displays.

What has this got to do with us?

• The mobile device revolution has been the equivalent of these moves.

• An old, 1st generation iPhone has the same processing power as such common supply chain stalwarts as dedicated hand-held Symbol & Motorola mobile computers in terms of processing power…. and can be bought for $50 on eBay.

• What is almost obsolete from a consumer point of view is still ahead of most established supply chain technology due to the sheer accelerated pace of this market.

What does that mean?

• Not only is there much more powerful, cost effective technology available for a fraction of the cost…

• There is also the opportunity to refine processes beyond what was limited by a closed market for software previously.

What are the process impacts of this?

• In a way, many of these advancements simply mean we move closer to a blank slate.

• Instead of picking a vendor/system, and then working out the best way to implement within the constraints of what’s available, now you can tailor your proposed system to your needs and then tender.

• The big challenge now is working out what your requirements and being able to think beyond the constraints of what’s been done before.

OK, give me some practical examples

• MONA in Hobart (The Museum of Old and New Art) gives every visitor an audio and video guide to the exhibits they’re seeing. It’s hand held, can detect their current location and provide information on what they’re seeing at that point in time.

• It’s interactive, immersive, and provides detailed location based information.

• How does it run? An app added to repurposed old iPod Touch’s, with a custom case added to restrict usage to the app alone.

• Why can’t even the simplest supply chain operation do the same thing?

Example 1: Live Ecommerce Order Picking

• A retail client engaged us to assess their e-commerce fulfilment process.

• After assessing whether the current facility was capable of handling their forecast orders, the determination was that it would suit purpose for another 1-2 years if some process enhancements were implemented.

• To maximise current space, detailed pick slot locations were implemented based on a grid system.

• An analysis of the current process determined that much of the picking path could be optimised.

• All effort for orders was doubled by the need to collect an order and then return it to a consolidation point for labelling and packaging.

• With a limited budget, it was determined that using picking trolleys equipped with connected devices, USB scanners and portable label printers could completely remove the consolidation process.

Example 1: Live Ecommerce Order Picking

• The moral of the story? Different uses dictate different needs.

– How much screen space does someone need to process an order in your case?

– What peripherals are required?

– Would a picking trolley with a mounted laptop allow more volume than a mobile device and a picking basket for your particular merchandise mix?

• The increased use and reduced cost of mobile devices has meant that these are now the relevant questions, not what is available under the budget.

• Technology no longer dictates the solution, as flexible and cheaply available devices are interchangeable.

• Most employees are instantly familiar with mobile devices, so there’s also the reduction in the learning curve required with a new system.

Example 2: Finding middle(ware) ground

• Not only are mobile devices themselves opening up new possibilities, the technology developed to allow multiple different devices to talk to each other opens different possibilities.

• Many clients we talk to are not looking to be tied to an end vendor or product.

• As technology has changed, so have business models.

• Instead of choosing a freight provider, what not choose a freight broker?

• We have installed Temando for several clients, allowing them to move between different couriers or transport providers at a moment’s notice.

• Instead of choosing to consolidate into a single system when integrating a business unit, why not find a middleware system that talks to both that can save the trouble?

• We have used Flow Software for several clients as a means of connecting their ERP system to their ecommerce system without needing to create bespoke integrations each time.

Example 3: Warehouse Management

• Ten years ago, the challenge for integrating ecommerce into existing supply chain setup often proved too hard.

• Limitations in combining single pick for ecommerce and bulk pick for store supply chains could result in splitting operations – sending ecommerce/single pick orders to separate warehouses/3rd party fulfilment providers and running them independently.

• Part of the issue was an inability to quantify data on these operations.

• Most people could tell it would add effort to perform pack breakdown to existing operations, but couldn’t quantify what impact it would have.

Example 3: Warehouse Management

• As a result, it was easier to split operations than mess with a winning formula.

• A large part of the issue was the ability to make technology alterations easily – it often was more cost effective to duplicate an entire operation than make the changes to the underlying system.

• This has now changed – technology now provides an opportunity to overhaul an entire supply chain including single pick ecommerce as opposed to a hindrance to integrating it.

• Real-time interaction between fulfilment staff, delivery drivers and supervisors was once either a verbal or paper based exercise.

• Now, it’s easy to communicate in real time with an employee in a device they’re pre-trained on thanks to their personal use.

Example 3: Warehouse Management

• What if what we’re seeing is an opportunity to remove existing inefficiencies from an offline supply chain?

• Is it possible that ‘endless aisle’ and other notions are providing an opportunity to remove the supply chain miles required by stock that has a slow stock turnover in stores to begin with?

• Why dedicate floor space (and transport space) to items that the customer could order online, or via a kiosk in store?

• In this way, even adding a mobile device as an in-store point for customers to order extended range can save a massive amount of supply chain effort without changing a single thing with the warehouse system.

Example 4: Transport Routing

• Even five years ago, the ability to process large amounts of deliveries from multiple destinations meant dedicated software which could geocode addresses, compute possible delivery times and use detailed algorithms to determine the best route.

• Trying to do 1000 deliveries a day across a metropolitan area with guaranteed delivery times pre-booked meant:

– Determining a data structure.

– Exporting data to an external system in a readable format.

– Calculating every possible delivery route permutation within the time constraints.

– Running a lengthy program to determine the optimal number of trucks required to perform these deliveries.

– Notifying a dedicated transport provider of the number of trucks required in advance.

– Exporting from the external system, and then re-importing into the source system to update each order/delivery with their intended time.

– This process could take several hours and involve much manual confirmation.

Example 4: Transport Routing

How has this changed?

• The advancement of mobile devices and their related architectures mean that even where a mobile device would not suit, the related API’s that have been developed to serve mobile devices provide great opportunities.

• Freely available systems such as the Google Maps API mean that dedicated systems for these functions are no longer required.

• Most supply chain and ecommerce systems have pre-built API integrations between these systems, meaning a dedicated desktop computer to export and import files in no longer required – a best practise install can perform these functions while logged in to an interface via desktop, tablet or mobile device.

• Transport providers all have their own API integrations – meaning you can then tender for the amount of deliveries required in real time.

• This takes what was a five hour daily task to what can be performed in minutes if not seconds.

• Tracking of the deliveries no longer require $5,000 on board computers in each truck – all they need is a smartphone and relevant app.

What does all of this mean?

• Technology is providing an opportunity to re-think all processes.

• Don’t think about how you can force technological advancements into an existing supply chain, think about how you can use them to alleviate existing problems that are often taken for granted.

• Start from a blank slate and re-imagine the optimal process. You’ll always need to compromise and be realistic, but the discussions you have now about what would be optimal but is not yet practical may be an invaluable asset in five years.

• Once you have your process, the technology is there to make it a reality, and at a price cheaper than ever.

Who are Playhouse?

• Playhouse is a multi-channel retail consulting & digital agency.

Specialising in assisting bricks & mortar, brands and transactional

retailers maximise on their online opportunity.

• Our team is composed of knowledgeable experts who have led or taken

part in large web projects both in Australia and Internationally.

• Our unique experience is derived from experience on both agency and

retailer side.

• Our strongly agnostic consulting services derive from this extensive

experience.

• We respect and understand the need of understanding the customer

wants, but also delivering profit for the business.

• We deliver actionable recommendations and advice based on fact and

backed up by decades of experience in both online and bricks & mortar

retail.

Contact: Luke Goldsworthy, Managing Director

ljg@playhousedigital.com

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