Automation: What’s next for supply chain software
April 19, 2013 - MMH Editorial
If you’ve been around this industry for twenty years or so, you may remember the origins of the best-of-breed WMS market we know today. The catalyst was compliance labeling. Major retailers like Walmart began to require their suppliers to label their cartons to speed up the receiving process. Basic inventory and warehouse management systems then on the market had been designed to handle pallets. They weren’t up to the job of creating custom labels for cartons or the value-added services that followed.
Vendors like Manhattan Associates and RedPrairie, now JDA, stepped into the breach with applications that filled the missing gaps. Over time, they have evolved into the full-blown, sophisticated suites of supply chain execution applications.
Today, we’re in a Back To The Future moment in the supply chain execution market. Instead of compliance labeling, retailers, distributors and manufacturers are trying to swim into the eCommerce wave and ship individual items to customers. In the health care market, they are complying with new government regulations.
However, many of those customers are using WMS’s they installed a decade ago to handle compliance labeling. Those systems are great at what they do, but they lack functionality for sophisticated picking strategies, pick-to-light and voice recognition that are powering these new processes. As they talk to their vendors, they’re discovering that an upgrade to a new WMS is pricey and disruptive. As Ian Hobkirk, managing director of Commonwealth Supply Chain Advisors, pointed out at the MHI spring meetings last week, most end users of those systems don’t want to go through the pain or expense to get the latest offering. They want to extend the life of their existing system as long as possible.
As in the 90’s, a group of industry veterans is stepping into this breach. It’s a trickle, not a flood, but they are offering applications that provide missing functionality while sitting on top of legacy systems – and at a fraction of the expense of upgrading a WMS. These are interim solutions. But they allow an end user to extend the life of a system that is otherwise doing the job by a few more years.
“We do this all the time,” Curt Sanderson told me after Hobkirk’s presentation. Sanderson is the managing principal of Open Sky Group, an integrator who specializes in implementing RedPrairie/JDA systems. In Open Sky’s case, Sanderson’s team is writing code to help customers meet their needs.
That’s one approach. At the same time, some industry veterans are going to market with commercial tools that allow end users to create the missing functionality in their systems. One example I’ve written about in the past is Babbleware. However, they’re not alone. A few days before the spring meetings, I met with Tom Lee and Bob Kennedy from DM Logic. Kennedy, Lee and their partners all previously held leadership roles at Marc Global, a WMS provider that was acquired by RedPrairie in 2006. They formed DM Logic after a handful of Marc Global customers reached out for help with their legacy systems. “They were running their operations on older Marc systems, but they needed some additional functionality,” Kennedy told me. “They were looking a million dollar plus investment in a new WMS. We believed we could help them for a fraction of the cost.”
DM Logic was formed when this group realized there are a lot of legacy systems out there. For one global health care company, for instance, DM Logic has created functionality that meets epedigree requirements. They are piloting a solution that will allow the company to meet the rigors of shipping product for a clinical drug trial. But what Kennedy and Lee are really excited about is a product called stepLogic.
While they are struggling to define just what it does, think of it as a process development tool that allows a layman who is not versed in programming languages to easily define and create new distribution processes that will sit on top of a legacy WMS. “It’s software for the proletariat,” Kennedy said.
Exuberance may have gotten the better of Kennedy on that one. But like Babbleware, it represents a new tool for the distribution tool kit. Is it what’s next with supply chain execution software? Are companies like Babbleware and DM Logic laying the groundwork for the next Manhattan Associates or JDA? As I wrote about Intelligrated’s acquisition of Datria early this month, no one knows the future. But companies like them are making a bet on where technology may be headed in the future.