Best practices in the warehouse used to center around materials handling only.

Today, there are also best practices for managing the information about the movement of those goods. "Every time there's a disconnect between the physical movement of goods and information about the movement of those goods, there's an opportunity for improvement," contends John Hill, principal with ESYNC (419-842-2210).

Anyone doubting the wisdom of that statement just needs to think of Wal-Mart and Dell, two companies that dominate their industries thanks to best information technology practices, regardless of how different the two companies are from one another.

"There are organizations that can make due with paper-based transactions and a rudimentary inventory management application," says Tom Singer, principal, Tompkins Associates (800-789-1257). "At the same time, there are plenty of paper-based operations still out there that could make their operations more efficient with supply chain execution technology like bar codes and warehouse management systems."

Singer's rule of thumb: "If I can build a business case to justify the investment, it's a best practice."

Singer divides best practices into three camps: the classics, the next level and emerging best practices.

Just as a basic blue suit, button down shirt and striped tie comprise the classic wardrobe, warehouse management systems (WMS), wireless communication and automatic data capture (ADC) are the classic technologies that enable the essential processes in any facility: receiving, putaway, pick, pack and shipping.

While those may sound so basic, the fact is that many companies have still not implemented these classics.

"There is so much basic blocking and tackling that has to be done before you can move on to more sophisticated best practices," says John Pulling, COO of Provia Software (877-776-8421).

In fact, the recent changes in manufacturing and distribution haven't made the classics obsolete. "The new demands of the world make them that much more acute," says Singer.

Those classic best practices have two purposes: reducing labor and providing better inventory control. "From those two stems everything else," says Prashant Bhatia, senior director, product management, Manhattan Associates (877-596-9208)

WMS systems are the cornerstone. They track the location and quantity of inventory and direct the activities of personnel on the floor.

A wireless communications network enables complete mobility. "Without a wireless network, your operators are still tied to a hard-wired computer terminal, limiting their productivity," says Bob Eckles, industry marketing director, Intermec (425-346-2800).

Automatic data collection (ADC), either through bar code scanning, camera-based imaging, voice technology or radio frequency identification (RFID), is faster and more accurate than manual data entry. "The reasons for automatic data collection are simple," says Jerry McNerney, director of global supply chain execution solutions for Symbol Technologies (800-722-6234). "Visibility, accuracy and productivity."

In addition to WMS, wireless and ADC, many would add mobile computing to the list of classics. "In the early days, an RF [radio frequency] terminal merely emulated the computer screen so that a mobile worker could follow the same processes as a full-screen user," says Eckles. "Today, you can put a browser and a system on a handheld device with Windows CE. That allows users to interact with a WMS or enterprise system from the floor and not just follow instructions."

Companies that have mastered the classics are ready for the next level of productivity improvement.

That's being driven by an operational urgency that requires timeliness of information and throughput. "It used to be that if I took an order at 10 a.m., I'd have until tomorrow to ship it," says Singer. "Now, that order has to ship by 4 p.m. today."

The companies best positioned to meet those kinds of demands have not only implemented the classics, they have integrated them together. "The single biggest thing that characterizes the best organizations is an IT staff with an integration plan that they work on constantly," says Provia's Pulling. "That eliminates manual work-arounds and makes information available where and when it's needed."

Integration is not as easy to achieve as it sounds, says Pulling, but it makes possible processes and practices that enhance the effectiveness of the classics.

Advanced shipment notifications (ASNs), for instance, are a best practice that relies on an integrated infrastructure, which is a reason that few companies actually use them. "We have a joke that all ASNs are outbound because no one seems to get any," says Pulling. "Having an infrastructure that allows you to request and accept ASNs is important, and it's not done very well by very many people."

Having an advance view of the product and shippers coming into a facility allows a company to make better use of its yards and docks. "A yard management solution can have a big impact on your overall throughput," says Noah Dixon, vice president of product management, Catalyst International (414-362-6800). "On the inbound side of your operations, it allows you to unload the trailers you need the most right away. And on the outbound side, it allows you to get the right trailer to ship out when a tractor arrives."

Inside the facility, dynamic slotting applications insure that the right product is stored in the right location to maximize storage space and the productivity of pickers based on order profiles.

On the floor, other best practices are coming together to enhance the productivity gains from a WMS. Labor management, for instance, uses engineered labor standards to determine just how many workers will be needed to get out the work for a particular shift. Task interleaving, meanwhile, finds the most efficient way for operators to complete tasks. For instance, a lift truck driver who has just put away a pallet, may retrieve another load from that same area to replenish a picking zone.

Voice technology is also coming into its own, especially in carton and piece picking areas. "Voice is infinitely more flexible than many other technologies because workers have their hands and eyes free," says Dixon. "You have to have enough transactions to justify the implementation, but in the right application, it works." Furthermore, voice is now being expanded into other applications including receiving, putaway, replenishment and transfers.

Finally, reverse logistics solutions are automating the returns process, especially for retailers and catalog companies. "As a best practice, reverse logistics begins when a customer first lets me know they're sending my product back," says Manhattan's Bhatia. "If I know what's coming, I can decide to dispose of it without it ever going back to the warehouse by returning it to the vendor, sending it to another store or warehouse or scrapping it all together."

Like rust, technological innovation never rests.

The emerging best practices are focused on extending processes that traditionally took place inside a facility further upstream and downstream in the supply chain.

The goal is global visibility. Today, that means synchronizing demand, inventory and shipments across a company's customers, suppliers and third-party logistics providers. "The further back you can get visibility into your supply chain, the more you can streamline your processes," says Manhattan's Bhatia.

Getting visibility at more points along the supply chain is one reason so many retailers are looking at both RFID and wide-area wireless networks to enable communication beyond the four walls of the warehouse. "RFID will give us accuracy, speed and a depth of information that we've never had before," says Intermec's Eckles. "And with a wide area network, an executive can get off a plane in Chicago and see what's going on back at the factory or warehouse with his Blackberry, cell phone or PDA."

Distributed order management is another evolving best practice that allows a user to determine how best to meet demand before sending an order to a warehouse. "By taking a broader view of my orders, I may be able to ship directly from a manufacturer or cross-dock incoming merchandise without ever putting anything away," says Bhatia of Manhattan. "In that scenario, the warehouse becomes little more than a speed bump."

A similar process can take place inside the warehouse, Bhatia says, by asking whether inventory needs to be put away in bulk on shelves, or delivered directly to replenish a piece pick area. "If I can take inventory directly to the piece pick area upon receipt, I've reduced my labor costs," says Bhatia.

Inventory forecasting is another application that can streamline warehouse processes by looking at limiting the amount of inventory that hits the DC. "I run into too many warehouses that can't be as effective as they should be because they're moving around the wrong inventory," says Catalyst's Dixon.

Finally, warehouse optimization might be the next frontier for those enterprises that are looking at both their warehouse and transportation operations as one seamless process. "The organizations that fill orders most effectively understand their customer order constraints and their own constraints," says Provia's Pulling. "They're able to sequence the release of orders to the floor to get the maximum effect at the minimum expense."