energycioinsights

Leverage The Capabilities Of Technology

By Bob Klunk, Managing Director, DMI Fulfillment

Bob Klunk, Managing Director, DMI Fulfillment

I have worked with companies ranging from start-ups to multibillion dollar corporations since the eighties. I find there is nearly as much variation in technology and capability from company to company today as there was25 years ago.

I began working with technology in logistics in the nineties. Back in those days, the outbound trucking department was often referred to as “Traffic”. You chose a carrier based on things like which carrier brought pizza and doughnuts or which one offered tickets to a baseball game. Transportation Management Systems (TMS) were just moving out of academia, not easy to use and expensive. The best way to get a TMS was to outsource to a 3PLwho would start with new codeand leverage the cost against multiple users. These early systems could do things beyond simply selecting a carrier based on rates —such as LTL consolidation and multi-stop pickup and delivery — but the most amazing thing “back in the day” was that they allowed information to be exported and emailed in a spreadsheet versus having a report dropped on your desk printed on green bar paper. Ah, green bar paper reports.

In my current role, I work with a lot of startups and have a select few that I mentor. These are brilliant young people coming out of entrepreneurship programs on fire to start their businesses. They are often obsessed with writing “code” but don’t have the business experience to monetize. I benefit greatly from working with these startups. They keep me youthful with their enthusiasm and their “anything’s possible” outlook, but probably the best part is getting to tell stories about the “old days.” In a recent conversation with one of my younger counterparts, I mentioned a manufacturer with an out-of-date legacy system that was causing integration challenges. I referred to it as “A Green Bar System”.

“I think I’ve heard of green bar. What does it mean?” he asked me.

Oh boy, where do I start? So I began to explain that when I first started working in logistics, I began each day with a wide format dot matrix printout of my schedule. I had several of these in “folders” on my “desktop” — “desktop” being the faux-granite Formica top of a Steelcase desk from the ‘50’s. The “green bars” were there to help your eyes stay aligned as you read. I typically had an extra-long steel ruler to help as well. These reports would be covered in handwritten notes from the day before. At a set cut-off time, I had to have all my changes keyed into the “CRT” (Cathode Ray Tube). The “Data Center” would batch up my “job” and run all the code to print a new batch of reports to the printer in the “mailroom”. The “Mailroom Clerk” would then push around a wheeled metal cart and drop the reports on desks around the plant. We would eagerly await their arrival, and the first thing wewould do when they arrived was transfer all the handwritten notes from yesterday’s reports.

When figuring out where we’re going, it’s really important to know where we’ve been. There’s a mentality in the era of smart phones, real-time information and mobile apps that we should have everything right now. For young entrepreneurs, this is the norm. But, for those of us old enough to start a sentence with “back in the old days”, we remember when time and effort were put into strategically planning our next move rather than an app instantly giving us the answer. Technology has allowed for amazing advancements in the world of logistics, but nothing replaces experience, strategy and good planning.

My experience from the greenbar days is invaluable in planning where we go from here. The fasted growing need in fulfillment right now is a Distributed Order Management Systems, (DOMS). To be competitive in this world, your system must:

• Provide real-time visibility to available inventory to pick, pack and ship from multiple facilities. This includes your own distribution centers, retail stores, and third-party facilities or drop-shipping from the manufacturer.
• Be able to optimize origin for all the line items on an order based on the destination zip. For example, a customer orders a shirt and pants and the system identifies the closest location to the customer.
• Allow you to ship complete or split shipments. Are both items available at the closet location? Is service or cost more important? Should I ship them from a more distant origin in one shipment or create two shipments for a shorter distance? Did you offer free shipping but not promise a delivery date? Or did the customer opt for expedited shipping?
• Evaluate multiple carriers and consolidation options, i.e., a single delivery of multiple direct-to-consumer orders to a retail location for customer pickup.
• Process orders from your own shopping cart, Direct Ship Networks, or thirdparty websites who sell your products.
• Treat orders from multiple sales channels with different rules, such as branding the packing slip with the channel from which it originated. Leverage the capabilities of technology, but always rely on the basic fundamentals of identifying your objective, creating a plan and carefully executing to achieve your goal.

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