60 Seconds with… Michael Wohlwend

Title

Managing principal

Company

Alpine Supply Chain Solutions

Location

St. Charles, Ill.

Experience

30 years in supply chain management, including top leadership positions with several global software companies and private equity firms. He is a past president and executive board member of WERC and serves on the executive board of Gigi’s Playhouse Downs Syndrome Achievement Centers. His passion is to help Gigi’s young adults get jobs.

Modern: What are the trends you’re watching in the supply chain management software space, especially execution systems?

Wohlwend: One of the most interesting developments I’m watching is the move to the Cloud. It has been there for transportation management systems (TMS) for some time, but there hasn’t been a market for warehouse management systems (WMS) since that’s a real-time execution system. If it goes down, you can’t ship and people lose their jobs. That’s now changing. Solution providers are making significant investments in Cloud technology and security, and that means more organizations are comfortable migrating their on-premise solutions to the Cloud. That’s going to allow younger solution providers, who have built their technologies on the Cloud, to catch or surpass some well-known players. Those older solution providers are going to have to build a Cloud solution.

Modern: What about TMS?

Wohlwend: TMS in the Cloud is a proven solution, and it’s not mission critical. If it goes down, you can still ship. So, we’re seeing Cloud TMS providers growing fast and gaining market share.

Modern: What are you seeing in the warehouse execution space?

Wohlwend: What used to be called a warehouse control system that determined where a tote should go is now running voice and pick modules. So, there’s a blurred line between what’s now called a warehouse execution system and a WMS. Now, you still need the brain, so companies that have a big investment in an older WMS aren’t going to rip it out. They’re investing in WES to get those order fulfillment capabilities. It comes down to where you’re at in your technology investment and whether it’s fatigued. Now, one of the things we’re seeing with the new Web-enabled technologies is that a company can get an upgrade every year of their WMS. But, they’d have had to install the system in the last three or four years to get that capability.

Modern: What about WMS add-ons?

Wohlwend: Companies are investing in two areas: Slotting and labor management. Both are driven by the Amazon effect. For instance, there’s a DC here in Chicago now paying $15 an hour. That means every other DC in that industrial park had to raise their rate to $15 an hour or they’re going to lose their employees. With that added expense, you have to optimize your labor, and you have to do everything you can to make the job more attractive. That’s leading to slotting and labor management, as well as more automation like conveyor and robotics to make the job easier.

Modern: How acute is the labor shortage?

Wohlwend: It’s the No. 1 issue for all of the companies Alpine is working with right now. It’s not that there isn’t labor; it’s the quality of the labor and then retention. If your systems and processes aren’t easy to use, the labor is going to leave.

Modern: We hear so much today about artificial intelligence (AI) and machine learning. What role are they playing in the execution space?

Wohlwend: That’s interesting. In my previous roles, I saw where using AI and Big Data helped with functions like human resources or customer relations management. I haven’t seen it yet for real-time distribution. If you’re talking about inventory or distribution network planning, those are great tools to help you optimize. I think it’s going to be interesting to see how and where those technologies get applied in the supply chain execution space.