Imagine if you had started a large, multi-year, multi-six figure enterprise WMS implementation on March 1, 2020, just before the supply chain world was turned upside down by the global pandemic. How would that investment look today, one-year later?
According to Microlistics’ Archie Garcia, in a recent article in MHD Supply Chain News, before COVID-19 “…some businesses used to place accuracy and completion above speed, but we saw a lot of businesses change their way of thinking. We saw organisations much more inclined to move goods out the door as soon as possible.”
In a similar way, warehouse IT investment is shifting to prioritise efficiency and speed to market with a focus on achieving both short-term and continuing returns.
In a prescient article that predates the onset of COVID-19, McKinsey says that for organisations to succeed, IT leaders need to move from being “a functional to a strategic business leader.” To affect this transformation, McKinsey suggests three strategies:
In a more recent article, “Maximising the impact of technology investments in the new normal”, Deloitte’s CIO Insider warns IT leadership that the “Pandemic recalibrates technology spend”. Their guidance: agile planning and budgeting; the adoption of resilient supply chain analysis and management solutions; and investing in technologies that generate business value through growth and innovation.
When this IT investment thinking trickles down to the warehouse floor, and supply chain leadership moves closer to the C-suite, it becomes clearer that the old way of deploying warehouse technology just doesn’t cut it anymore.
With this new philosophy in mind, here are 5 things you shouldn’t hear when it comes time to implement a new WMS solution.
There is no doubt many people are suffering from big project fatigue. Long projects are tiring and disruptive. They also run the risk of being overtaken by changes in the business landscape. While it’s hard to plan for a once-in-a-lifetime event, like a global pandemic, there is little doubt that requirements will change over a one-to-two-year project and ROI timeline.
Unplanned change, without the ability to address with agility, will impact revenue, costs, and profitability. In addition, new opportunities, like the explosion in eCommerce during the pandemic, can emerge that require fast adaption to fully realise.
The new IT investment philosophy calls for an incremental roadmap approach that delivers benefits at the beginning, evolves over time, and can pivot in response to business threats and opportunities. This will provide ROI from day one and continue to provide that return over time, regardless of circumstances.
When assessing available technologies, it can be difficult to avoid indulging champagne tastes on a shoestring budget. This means spending money you may not have on something you may not need. Prosecco and other sparkling wines can deliver the same taste (and effect) without the pricey “champagne” label. Most software solutions are sold in different tiers and increasing price points, but your solution should meet your needs at a comfortable (and recoverable) cost point. Don’t chase “shiny” features or functionality that you may not need.
The new IT investment philosophy emphasises the selection of technologies that are scalable and modular, enabling businesses to:
An inflexible solution will have additional costs for licensing or require programming effort to make the modifications needed to work for your situation. Software subscriptions without too many throttle points and a large amount of configurability will ensure that costs do not soar after the solution design phase.
The new IT investment philosophy calls for systems that can adapt to significant changes in business long after the solution is put in place. In many cases, these changes can threaten a business’ survival and will come at economically sensitive times – not a great time to learn that you need to spend more money to adjust.
Working on a business’ warehouse implementation is not the same as working in a warehouse business. The new IT investment philosophy calls for small teams with strong subject matter expertise across internal stakeholders and vendor partners. These teams, and the solutions they create, will be lean, efficient, and effective.
This is where the initial costs of heavy upfront customisation work run into down-the-road hidden costs. The new IT investment philosophy calls for a platform-as-a-service and flexible architecture that is resilient through ongoing software updates and upgrades. Essentially, what you build today will work in the future.
This is something you should hear when exploring options for a new WMS solution. You need a warehouse IT investment philosophy and a WMS solution that is not only ready for the customer of today, but also ready for the customer of the future.
We’d love to work with you to develop a warehouse technology solution roadmap help achieve outstanding business results fast, while still providing scope for additional functionality and growth as time goes on.