Wireless Supply Chains: No Strings Attached
On the road, in the warehouse or the office, today's wireless technologies help streamline supply chain operations.
It's not here yet, but it may be soon—the wireless supply chain. On the highway, on the dock, at sea, and in the air, the use of wireless technology in logistics and supply chain management is exploding. From inbound to outbound and all points in between, wireless technologies help companies improve visibility, communications, and productivity.
Just ask Mindee Trudell, transportation manager for Nextel Communications Inc., Reston, Va. She taps the wireless communications company's solutions to optimize transportation of handsets and infrastructure, including towers and customer installations.
"A lot of our deliveries go to rural land sites," she explains. "I have to coordinate cranes, technical and installation crews, and may need to have the phone and electrical companies at the site. If a truck is running an hour late, I can use Nextel's direct connect feature to key up to six people at one time and let them know."
The message can be sent via voice or text. Drivers can request real-time directions or pull up driving directions from Maps.com via their phone, which is particularly useful for new drivers and carriers.
Trudell wants—and demands—real-time information from carriers and third-party logistics providers.
"One thing we look at during our selection process is the type of technology carriers and 3PLs can bring us. Every one of our major suppliers has the capability to give us real-time proof of delivery, online bills of lading, and up-to-the-minute delay reports," she says.
This capability is critical when, for example, an installation site reports a short shipment. "The installation crew can call the distribution center or logistics coordinator, who calls the carrier to request a real-time copy of the bill of lading," Trudell explains. The bill of lading will also show damage, even if it's cosmetic.
The flexibility and communications power of wireless technologies is being unleashed in myriad logistics and supply chain applications. For example:
Drivers for Gilbert USA, a division of P&O Nedlloyd Logistics, wirelessly download their route onto their handhelds each morning, using GlobeRanger's Outbound Delivery wireless solution. Drivers scan product as delivered, complete proof of delivery with electronic signature capture, perform on-the-spot reconciliation, and record the transaction on the handheld device.
Upon delivery, the driver prints a receipt for the consignee. Delivery data is automatically uploaded when drivers return to the DC after completing their routes.
Airborne Express dispatchers now communicate with approximately 10,000 drivers via real-time handheld data terminals that virtually eliminate handwritten and verbal errors, thanks to a two-way wireless messaging solution from Dynamic Mobile Data. New data terminals enable Airborne customers to view signature images for shipments in most major metro areas, providing a definitive proof of delivery.
Integrating Radio Frequency Identification (RFID) with an advanced Warehouse Management System makes it possible to receive products without manual processing.
For example, when an RFID-tagged incoming shipment moves into the distribution center, the facility's antennae captures information from the embedded RFID tags, then passes the data to the WMS, which automatically receives the shipment, reports Manhattan Associates. The supply chain execution company is teaming up with Symbol Technologies and Alien Technology to deliver this comprehensive RFID-based supply chain execution solution.
Dispatchers can now monitor truck driver practices such as idling, hard braking, and speeding using wireless technology from GEOCOMtms. The technology also collects vehicle performance data and imports it to fleet maintenance/management software, resulting in streamlined maintenance.
Route sales drivers for Schwan's Sales Enterprises deliver frozen foods to consumers using Intermec mobile computers and wireless printers that communicate through a Bluetooth wireless interface. In a recent test with GPS receivers, drivers were able to request and receive audible directions and alternate routes via their mobile computers.
Users who process returns in their warehouse or distribution center can do so remotely or at a desktop station using ReturnCentral's ReturnMatrix Wireless, which runs on most PDA operating systems.
A manufacturer's in-house integration team is developing three different applications to automate its data collection process using long-range RFID technology from Matrics Inc., a supplier of RFID-based data collection solutions located in Columbia, Md. The applications include automating receiving and toolroom visibility, and tracking work in process as it migrates through the manufacturing facility.
Several key developments have enabled the increased power of wireless technologies:
The convergence of cell phone technology, PDAs, the Internet, operating systems such as Windows CE, and powerful programming languages such as Java. For example, cell phones that can run the Java programming language act in many ways like computers, notes Marc Mitchell, transportation practice director for Enterprise Information Solutions Inc., a systems integration and computer engineering company based in Downers Grove, Ill.
That has important implications for transportation applications. "Because of advances in programming and communication technology, cell phones can accomplish much of the functionality that historically was done by a satellite-based on-truck system," he says.
The convergence of PDAs, portable phones, and operating systems is having an impact on the warehouse, according to Eric Peters, senior vice president of products and strategy at Manhattan Associates Inc., Atlanta. He predicts that powerful new phones will one day provide integrated solutions that may replace separate RF devices, phones, and pagers.
An open global network. The Auto-ID Center, a partnership of 80-plus global companies and three research universities, says it is "designing, building, testing, and deploying a global infrastructure—a layer on top of the Internet—that will make it possible for computers to identify any object anywhere in the world instantly."
This open global network has the promise of delivering what the Center calls "near-perfect supply chain visibility." One component of the network is EPC, or Electronic Product Code.
"The hope is that EPC tags will be embedded in consumer goods and create a wireless supply chain," says Eric Peters. He expects the price of RFID tags to drop as the technology becomes more widely adopted.
Developments Impacting SCM
Other wireless developments are likely to have an impact on logistics and supply chain management. These include:
Continued encroachment of consumer-type wireless applications. "This should trigger a price reduction on all equipment," notes Patti Satterfield, Q4 Logistics, Santa Ana, Calif.
"The functionality of standard cell phones—whose development and deployment costs have been amortized across Joe User—can be used in programmatic, controlled, and structured ways," says EIS's Marc Mitchell. He predicts "a huge explosion at that price point, and a much wider adoption of that technology."
Consolidation in the warehousing arena. "The wireless market has really consolidated in the past several years," Satterfield says. "With number-one Symbol's acquisition of number-two Telxon, the market share field narrowed dramatically."
In addition, she says, "the partnership between WMS vendors and specific RF vendors often make 'choice' a non-issue for customers." She cites the case of one RF vendor that has better than 50 percent of one well-known WMS vendor's clients.
"We'll see increased consolidation in the wireless world, with RF equipment becoming more and more of a commodity," Satterfield predicts.
Transportation applications will continue to fragment. While warehousing applications will consolidate, that's not necessarily true for transportation, observes Eric Peters. "We haven't yet seen the convergence in transportation that we've seen in warehousing," he says.
There are only so many ways you can move product through a warehouse, Peters notes. Transportation has many more variables, and many more niche players.
Steps to Success
You can look to your IT and telecommunications people for technical understanding of wireless technologies. But, in order to appreciate the power of all the options available today, get comfortable with the concept's underlying terms—WAP, WAN, LAN, RFID, EPC, Bluetooth, and Blackberry.
The environment "is very fuzzy right now," says Tom Coyle, vice president supply chain, Matrics Inc. "Logistics managers have been pestered by all sorts of wireless companies," each touting its own piece of the solution. In addition, there's all sorts of confusion about what "wireless" means, and how best to apply it in different scenarios.
"It used to be the IT department that bought the technology," notes Clark A. Richter, business development manager for Intermec Technologies Corp., an Everett, Wash.-based developer and manufacturer of automated data collection, RFID, mobile computing systems, bar-code printers, and other solutions. "Now, more and more companies put their operations department in charge of buying technology.
"Where IT is concerned about the technical aspects and implementation, the user has to make the system work," Richter says. "Operations people were not involved in decision-making in the past, but they're heavily involved now."
Here are some steps you can take to increase the likelihood of successfully leveraging wireless technologies in your operation:
Keep an eye on the future. Make smart decisions today for the best results tomorrow. For example, take advantage of the convergence of portable phones, PDAs, and Windows CE, Eric Peters advises. Evaluate carefully whether to buy Windows or DOS-based equipment, and ask how the products that you buy now will support the convergence that will occur.
Consider the hardware manufacturer's migration strategies. "If you decide to upgrade two years from now, what is the durability of the devices? How user-friendly and ergonomically capable are the devices?" says Richter.
Be clear about your requirements. "Understand the entire realm of availability, identify your requirements, and make sure the ROI is there," Mindee Trudell says. "You have to know what capabilities are available, know what to ask for your operation, and then ask for it." She advises pushing your carriers to build wireless technology capability, and deciding whether to make it a requirement.
Confirm the value. "Make your decisions based on the value you'll receive," suggests Marc Mitchell. "If you need to deliver a shipment in four days, it really doesn't matter what technologies the carrier deploys."
However, the logistics manager of a just-in-time operation—where plant shutdown is a possibility if a shipment doesn't arrive on time—will require that carriers have the optimum tracking capabilities available through wireless devices.
Do your due diligence. "Check references of other companies similar to yours, especially if you're implementing a new WMS and that vendor has purchased for a specific type of RF hardware," Satterfield advises.
Salespeople may quote environmental statistics that don't hold true in your industry. "If you're in the grocery industry, for example, find out who else uses this exact RF equipment with this exact WMS and talk to the reference to verify what you've been told," she says.
In fact, advises Tom Coyle, "If a service provider says it has a great technology, ask for a demo kit and use it for a few weeks. That's a great way to separate the hype from the reality."
Pick the vendor carefully. "Pick a vendor you know has been around for awhile and can trust," Richter says. He recommends selecting a vendor that uses open systems or standard-based technology, warning that "there are technologies out there that are proprietary, that have no migration path."
Don't be seduced by speed. "Data communications speed will continue to increase, but I honestly don't think too many warehouses currently need the ability to run streaming video on forklifts," Satterfield says. "Even though racecars are now available in terms of RF speed and performance, the reliable Buick is the best path for most distribution applications."
Be aware of maintenance issues. "The ongoing costs of upkeep on the RF units themselves and battery management are often overlooked, but are vitally important," she says. "They could be very expensive."
Recognize the impact of technology on your partners. The use of wireless technologies—or the lack of it—may change the way you look at partners, such as carriers or 3PLs. For example, new technology may make it possible for lower-cost carriers to provide the level of service you've always looked for from premium carriers.
Beware of global issues. If you operate internationally, keep abreast of potential challenges. For example, Peters says, the United States and Europe use different frequencies for RFID tags, which may require two chips.
Get going! "Action clarifies everything," says Tom Coyle. "Wireless is the way the world is going. You have to try it. You have to clarify its economic benefit, but you can't do that until you gain some familiarity with what the technology can and cannot do. Until you do it in your own setting and get smart about this technology, you will not get the clarity you need to move forward."
The time to start is now. Says Coyle: "You can't be a casual bystander and expect to make the impact you need on your supply chain."