How drones will benefit supply chains by Abhilasha Satpathy, DCMME Center Graduate Student Assistant

Drones speed up operations and decrease delivery times for the end user while cutting down on supply chain costs.

Asset Management

Manually monitoring inventory can require workers to spend extraordinary amounts of time and resources to count products on shelves. Keeping track and monitoring inventory levels can be an exhaustive process when done periodically, especially during high order demand periods such as the holidays. The use of drones to scan and check inventory anywhere in the warehouse using OCR, RFID, and barcode readers can offer better inventory management, especially when the drone can move from warehouse to warehouse on the property in moments and deliver this information instantaneously to integrated warehouse management software.

Speeding up Deliveries Between Commercial Buildings

Raw materials can be moved from warehouse to manufacturing floor with the use of drones. Drones can also move finished products from warehouse shelves to store shelves, or place products on pallets for shipping to end users and retailers.

Monitoring Supply Chain Delivery Routes

Additional capabilities involve monitoring supply chain routes for disruptions that could impact truck deliveries. These drones can monitor road conditions, construction slow-downs and other hazards while reporting the information to logistics managers who can quickly select alternative shipping routes.

Reference:

Drones and Supply Chain: How they May Impact the Process. (n.d.). Retrieved from https://www.ecsourcinggroup.com/drones-and-supply-chain-how-they-may-impact-the-process/.

Questions:

  1. How do drones impact supply chain?
  2. How will drones help cut supply chain costs?
  3. How will drones help in asset management?

 

 

Requirements of a Modern Pick to Light System by Nikhil Girish (DCMME Student)

Requirements of a Modern Pick to Light System
Nikhil Girish

The e-commerce model has forced significant changes on the traditional brick and mortar business model making the transition to omni-channel distribution. This transition brings up its own set of benefits as well as challenges. The challenges include:
Fluctuations in order volume: The order rate can vary based on the time of day, the day of the month, seasons, events and so on. The distribution channel must be capable of allowing flexibility to meet demand.Increasing number of SKUs to manage: The one shop for all products model and large scale promotions increase the volume of SKUs needed on shelves.
Service level agreements: Managing high customer expectations is a complexity generated by this model. Reducing delivery times, reducing costs incurred in shipping and facilitating in-store fulfillment are steps necessary to reach customer fulfillment levels expected by the target customer.
Traditional retail fulfillment: Traditional stores require consistent replenishment and appropriately high volumes of sizes, colors and styles need to be stocked on shelves.
The high variances in demand generated by the market need to be assimilated by the distribution system efficiently. This involves improving time efficiencies in the material handling and distribution network. These requirements are not sustainable by a traditional pick to light system. A modern pick to light system requires the ability to customize it to suit the type of business, it needs to cross barriers of language and culture and deliver instructions with clarity, it needs to be able to adjust and improve its algorithm to save time and thus cost in a market where delays can run up costs exponentially. A modern pick-to-light system is integrated with the warehouse management systems (WMS) and ERP systems and uses high computing power to constantly solve optimization problems to determine which employee handles what package taking it where and carrying what quantity. These are in addition to the traditional requirements of a pick to light system that demands a simple process that saves training costs and minimizes skill requirements.

Considering the Amazon example of a successful pick-to-light system implemented by Amazon’s warehouses all over the world, the system provides each warehouse associate with a hand-held device used to scan a barcode to pick up an order from racks or bins. The display constantly shows the location number with a light guided system to direct the associate step by step through the warehouse. The appropriate rack then has a light indicator and the screen shows the quantity number that the associate needs to pick up and move. The system of lights and numbers ensures that the instructions transcends the language barrier. Companies are also experimenting with voice guided systems that are made available in multiple languages. The light guided system offers essential feedback for the associate at the warehouse in real-time.

In order to optimize supply chain efficiencies, modern pick-to-light systems need to offer much more than traditional pick-to-light systems. This also brings up the question of who actually needs such a modern pick-to-light technology. These resources are essentially capital intensive and the question further inquires whether the user actually able to leverage their supply chain efficiencies to the extent to witness gains from this modern system.

References:
The Viability of Modern Pick-to-Light Systems, Honeywell Intelligrated. https://www.thebalancesmb.com/pick-to-light-warehouse-systems-2221456
https://www.logisticsmgmt.com/article/warehouse_and_dc_order_fulfillment_locke_supplys_path_to_accurate_productiv

Embedded Manufacturing by Matthew Gebbie (DCMME Center Graduate Student)

Ensuring quality and uniform components is essential to the manufacturing process. Validation and measurement (metrology) are an integral aspect of ensuring quality. Current manufacturing operations rely on measurement validation by teams of people, selecting random parts from a batch and measuring to validate the entire batch.  While necessary, this is a time-consuming process that can lead to a company having to re-work or scrap an entire batch of components wasting valuable resources and costing money.

Embedded metrology is a new way of measuring and validating manufactured components, speeding up the manufacturing process, saving money, and validating every component, instead of just one from each batch.

Embedded metrology is a way to measure every single manufacturing component by embedding laser or optical measuring technology in each machine. This new smart measuring system will aid manufacturers throughout the machining process, speeding up production, ensuring quality and saving money. While there are currently only a handful of companies taking advantage of embedded metrology, expect this to become common practice as we move toward a world of smart manufacturing.

 

What impact will embedded metrology have on the human workforce?

How soon will embedded metrology become economically feasible for small manufacturers?

What industries will rely on embedded metrology in the future?

 

https://metrology.news/smart-factory-metrology/

https://www.engineering.com/AdvancedManufacturing/ArticleID/14896/An-Introduction-to-Metrology-and-Quality-in-Manufacturing.aspx

http://www.qmtmag.com/display_eds.cfm?edno=2630434

https://www.theengineer.co.uk/epsrc-future-metrology-hub-measures/

Sustainable Forestry

By Gokul Siddharthan J, DCMME Graduate Student Assistant

timber-in-winter-forest-stock-photo-3038761

When it comes to climate change, one of the primary industries that is singled out apart from fossil fuel and energy companies is the timber industry. Historically, they have been known to contribute to climate change through deforestation. We know that trees are responsible for capturing the carbon in the atmosphere, and the historical rate at which deforestation has been is an alarming cause of concern. Both deforestation and pollution rapidly increase the rate of global warming. However, with the advent of modern technology and increasing social awareness for a push against deforestation, timber companies are arriving at innovative solutions to reduce the carbon footprint and have their operations sustainable for the environment.

The Finnish timber company, Metsä Group, has positioned itself as a “forerunner in sustainable bioeconomy”. After a recent makeover costing $1.3bn it is now known as a bioproducts mill and as such is one of the largest in the world. This plant, near Äänekoski, a town in the centre of the country, consumes 6.5m cubic meters of wood a year. The forest is home to many species of wildlife, and the trees lock away the carbon in the atmosphere. Yet the company claims the mills do the opposite. For every tree harvested, four saplings are planted. The trees are thinned to ensure the best specimen survive, thus improving the overall tree population. Despite the increasing demand for wood, the annual growth of trees in Finland exceeds the volume of felling and natural loss by over 20 million cubic meters.

The mill has an aim to make use of every part of the wood. It has come up with many sustainable initiatives that make use of the textile industry to buy its byproducts. Their operations use some of the latest technology, such as drones to map out large swathes of land digitally. Harvesting an area is done by giant eight-wheeled machines, which fell, trim and cut the trunks to the required size. Information is relayed electronically to the mill to schedule deliveries. The company itself is researching innovative solutions that can help the timber industry reposition as a sustainable player. Such responsibilities and initiatives to the environment reassure the public to replace trust in corporations. There is no limit to their sustainable journey, and these innovations can even shape the future into a more habitable place.

Source:

https://www.economist.com/science-and-technology/2019/10/17/how-to-make-use-of-all-of-a-tree

 

How to streamline procurement in the future of supply chains by Abhilasha Satpathy, DCMME Center Graduate Student Assistant

Here are some recommendations of how companies can thrive with all the disruptions taking place in the field of supply chain and change their procurement strategies to keep up.

  1. How to plan for impacts of automation and migration of workforce

Mass migration on a large scale, along with forecasts that significant numbers of workers will be displaced by automation, will increase volatility in supply chain labor dynamics. This volatility could be mitigated through responsible and inclusive labor practices. Companies with supply chains that expect significant uptake of automation through 2025 could insist that key suppliers develop clear plans to support a sustainable workforce transition.

  1. How to build responsible regional sourcing hubs

Growth in new markets and demographics and meeting customer demands for customized, on-demand goods and services will require understanding and meeting new consumption patterns and preferences, as well as providing goods and services in new locations and formats. In response, supply chain leaders will have an opportunity to develop nimble, regional supplier networks that can meet both commercial expectations and sustainability aspirations.

  1. Digitalize Supplier Assessment and Engagement

With more data about supply chains produced and disseminated than ever before, supply chain leaders have the opportunity to rethink how they collect and interpret supply chain information. Practitioners will need to hone in on the supply chain information that is decision-useful in a sea of available data and dashboards and will need to reconsider which data they need to commission and how it is collected.

  1. Strengthen Supply Chain Transparency and Disclosure

The regulations that shape mandatory corporate disclosures about sourcing practices, futuristic supply chain leaders can prepare for a variety of possible future scenarios through enhancing both visibility into supply chain practices and disclosures about those practices. Enhanced transparency will support supply chain leaders in the case that global trade is transformed by political shifts toward economic nationalism.

  1. Embed Climate-Smart Supply Chain Planning

To prepare for the environmental changes and other supply chain risks that come with it, companies will need to take into account climate risk and preparedness into supply chain planning models, seek alternative materials and resources where necessary, and look for new ways to secure supply and minimize disruptions in their supply chains.This would also mean working with suppliers that share a commitment towards climate awareness and action.

Reference:

Future of Supply Chains 2025: Blog. (n.d.). Retrieved from https://www.bsr.org/en/our-insights/primers/future-of-supply-chains-2025.

 Questions:

  1. How can companies plan for shifts in procurement trends?
  2. How will climate-smart supply chains be useful in the future?
  3. How will regional sourcing hubs be useful?

 

Microsoft Surface Neo

In 2009, Microsoft was believed to be developing a dual surface tablet called Courier, but nothing ever came of it and instead Microsoft developed the Surface tablet.

As of October 2nd, Microsoft has decided to bring back a dual-screen tablet called the Surface Neo. It will use Windows 10 updated software called Windows 10X and be more user-friendly not only for tablets but also for mobile devices and any device that allows the user to use their fingers. Windows 10X will have all the similar features of Windows 10, but will sadly remove the Start Menu and will be similar to Windows 8.

In addition to the Microsoft Surface Neo using Microsofts updated user software, it will also have a magnet keyboard that easily detaches and is stored underneath one of the dual-screen. As well as a Wonder Bar that’s very similar to Apple’s Touch Bar and it will also have a slim pen.

The expected release date for the Microsoft Surface Neo isn’t until the 2020 holidays. It’s assumed the reason for an early information release is for App developers to develop apps that work in accordance with the dual screens, and work out any kinks that could possibly result from having dual-screens. Just like the Samsung Galaxy Fold Phone that had so much hype and expectation, but had so many issues and was a huge let down for its consumer base. We’ll see if this means dual screens will make a comeback and become the new norm after it’s release in late 2020 and how competitors like Apple and Samsung will respond.

Sources:

https://www.slashgear.com/windows-10x-official-dual-screen-os-with-some-big-changes-02593836/

Amazon in the retail shipping industry

References

https://www.forbes.com/sites/blakemorgan/2019/08/09/a-painful-breakup-amazon-and-fedex/#451c05df77fd

https://www.cnbc.com/2019/02/15/amazon-will-compete-with-fedex-and-ups-to-become-logistics-company.html

https://www.businessinsider.com/fedex-amazon-delivery-capabilities-vs-amazon-logistics-2019-7

https://www.forbes.com/sites/gregpetro/2019/06/28/amazon-versus-fedex-the-retail-shipping-wars/#3b79db42662e

Background

Since 2015, Amazon has been building up an internal logistics network so it can deliver its own packages — a move that saves the retail giant money. It costs Amazon $6 to move a single box through its own network, versus $8 to $9 to move through UPS or FedEx. Given Amazon’s scale, that could be a couple of billion dollars at least in savings.

From Partners To Competitors (FEDEX and Amazon)

Amazon has been bolstering its own delivery network for years to get orders to customers more quickly. The move puts it in direct competition with services like FedEx and UPS. As Amazon has expanded its logistics and pushed the envelope on shipping, FedEx has matched it step for step, including offering things like expanded fulfilment centers, faster shipping and robots and automation. The long partnership could now turn into a strong rivalry.

Losing Amazon could seem like a big drop for FedEx, but it actually opens the door to partner with other retail giants, including its existing deals with Walmart and Walgreens. FedEx says one of the key factors in deciding not to renew its contract with Amazon was because it wanted to focus on the larger e-commerce market. The number of e-commerce packages is expected to grow from 50 million to 100 million a day by 2026.

Amazon is a leading company in the e-commerce and logistics space, but that doesn’t mean it’s immune to broken partnerships. Its aggressive delivery strategy cost it a deal with FedEx. Time will tell if the internal delivery service is ready to handle the large influx of orders and deliveries.

Why Amazon Is Bringing Logistics In-House

Amazon’s Chief Financial Officer Brian T. Olsavsky said it: “What we like about our ability to participate in transportation is that a lot of times we can do it at the same costs or better and we like the cost profile of it, too.”

Not to mention, Amazon can use all of the data they can bring to bear to create the most efficient e commerce shipping solution possible. But what is behind the big push?

Shipping is expensive. Companies everywhere are wrestling with slim margins made slimmer by heavy operations costs. Amazon has some of the most advanced warehouses on the planet. They’re constantly looking to innovate and streamline their current operations.

Despite these efforts, Amazon’s worldwide shipping costs were fifteen times higher in 2018 than in 2009.

Inside an Amazon Air operation

Amazon Air currently has planes at 21 U.S. airports and it’s opening new regional hubs this year in Fort Worth, Texas, Wilmington, Ohio, and expanding one in Rockford, Illinois.

Amazon will open a $1.5 billion air hub at Cincinnati/Northern Kentucky International Airport in 2021. There it will have capacity for 100 planes — double the number in its fleet now — and will plan to schedule 200 flight landings and departures each day.

One bustling Amazon Air operation is at Ontario International Airport in Southern California. It recently dethroned Atlanta as the country’s No. 1 airport for outgoing cargo.

“We have about eight flights a day on Prime Air,” said Ontario International Airport Deputy Executive Director Atif Elkadi. “I know when they started here a couple of years ago it was maybe three or four flights a day and it has steadily increased.”

Some of the Amazon aircraft CNBC saw at Ontario International are repainted with blue Prime branding, while others still carry logos of the airlines Amazon leases the planes from: Atlas Air, ABX Air and air cargo conglomerate Air Transport Services Group.

Once Amazon packages are offloaded from Amazon planes, they’re sorted on site at the Ontario airport, loaded onto Amazon semi trucks and sent out to one of its 185 fulfilment centers. Amazon Air has gotten so busy in the region that it recently opened a new center at March Air Reserve Base in Moreno Valley, just 30 miles from Ontario International.

 

Questions

  1. What does the logistics industry look like?
  2. Will Fedex’s decision to part ways from Amazon be sustainable in the long run?
  3. Can Amazon sustain its logistics business?