Peter Bradley is an award-winning career journalist with more than three decades of experience in both newspapers and national business magazines. His credentials include seven years as the transportation and supply chain editor at Purchasing Magazine and six years as the chief editor of Logistics Management.
Even thinking about a major systems integration project can be daunting. The process of bringing together multiple technologies—material handling equipment plus a wide array of software—demands significant time and resources... and entails a large measure of risk.
The goal is to link these disparate pieces into a seamless whole. Business success—not to mention careers—depends on successful execution. To borrow a phrase, failure is not an option.
So what does successful implementation take? We asked a number of experts who specialize in systems integration what their customers need to do in advance of and during a major project to ensure that it runs as smoothly as possible.
Make the case. Major projects require substantial capital, and that means senior management buy-in. But significant changes in operations affect many parts of the company beyond the DC—sales, marketing, operations, IT, and more—and project leaders should ask managers in all of these functions to weigh in on a proposal.
David Farmer, vice president of sales and marketing for Fortna, which describes itself as a supply chain design and implementation specialist, emphasizes the need for managers to view the project through both what he calls the business lens and the functional lens. "The business lens is about service, cost, revenue, reducing risk, and strategy," he explains. The functional lens focuses on how the overall system will work to meet the business objectives.
James Bowes, president of Peach State Integrated Technologies, adds that it's important that the project planners look out over a sufficient time horizon. "If you're going to make an investment of seven or eight figures, that needs to sustain you for seven to 10 years, so you are really pushing executives in sales, marketing, and finance to think out that long," he says. "What will your growth and your channels look like? We like to start with that end in mind and build back to what's required for the next three to five years, with an expansion plan to add to the system without compromising day-to-day business."
Plan, then plan some more. That might seem obvious, but what's often overlooked is the breadth of detail that successful project implementation requires. "The most successful projects are those in which companies invest the time in planning," says Bowes, whose company provides consulting and engineering services for manufacturing and distribution. "What we've seen is that success is 50 percent planning and 50 percent execution. You get in trouble when you try to do things too fast."
Jim Barnes, president and CEO of supply chain consulting firm EnVista, says, "First and foremost, you have to define the detailed functional and technical specifications that create the scope of the project. You find the devil in the details."
Once you've reached agreement on the scope of the project, the next step is to identify what resources will be required. "Make sure you have an adequate budget," advises Pat Sedlak of Sedlak Consulting, a firm that works with clients like adidas on major distribution center projects. What companies sometimes forget is that the budget has to cover more than just capital equipment and integration costs, he says. You also have to factor in the cost of making the transition from existing systems and "extras" like anti-fatigue mats and floor sweepers—expenses that can add up quickly. Bowes of Peach State adds that the budget should include the costs of maintenance contracts and spare parts inventories as well.
Farmer notes that the same kind of attention to detail should be extended to staffing. Early on, managers must assign specific responsibilities to individuals for the various segments of the project. "If you don't create ownership by work streams, something will fail," he insists. At the same time, all of the parts need to be coordinated. "Where you fail is when someone says, 'I'm going to put in a new material handling system' without knowing how it will impact the warehouse management system or people readiness. The overall project documentation must show where each work stream touches any other."
It might seem that a plan developed for a new facility would have a lot more moving parts than a retrofit. But Bowes says that's not always the case. Planning for a retrofit can be more difficult and complex than planning for a new building since installation must proceed in tandem with existing operations, he explains. "The tactical planning is even more important," he adds. "You simply cannot compromise a facility's ability to serve customers."
Develop a realistic schedule. "You can have problems with a schedule that is too short or too long," Sedlak warns. "If it's too short, you risk looking like idiots—you have to run and gun and put pressure on the whole organization. If it's too long, people lose focus," he says. "It is really critical to keep momentum going," adds Bowes.
So how much time does the typical systems integration project require? Sedlak says that for a new facility, a schedule normally runs about 18 months. Retrofits are somewhat quicker. Executing a major project in an existing building will take four to six months, with planning for six months prior to that, says Dean Starovasnik, practice director for distribution engineering design at Peach State.
Organize the right team—and give it authority. "The first step is setting up the proper structure," Farmer says. That includes putting together a team and developing a communications plan at the outset. "You cannot accomplish a systems integration project without the proper structure."
Bowes, like other experts, says the team must include representatives from a number of functional areas—finance, marketing, operations, IT, and distribution, among them.
But putting together the right team is only half the challenge, says Barnes. You also need the right project manager. "What makes or breaks these projects is good project management, not only by the systems integrator but on the client side," he says. The project manager must be a great leader, one who can keep the team united and focused, as well as a great communicator, he adds. "You need to be able to communicate upward both good news and bad."
To be effective, the project manager must be given enough leeway to carry out the task. But that doesn't always happen, says Barnes. "They often have the responsibility but not the authority."
Sedlak adds that the role of project manager should be treated as a full-time job. "These change programs cannot be accomplished with half-time people," he says.
Communicate constantly. That's especially important if a part of the project goes off schedule. "If you're running behind, don't put off communicating that," Farmer says. "You don't know if that impacts another part."
And communication must be timely, particularly when things go amiss. "Bad news does not get better with age," Barnes says.
Honor the schedule, but don't rush to the finish. Even the best laid plans can go awry, leading to holdups and delays. Once a schedule slips, it's tempting to compress some of the final testing and debugging and put the system to work. That's a mistake, the experts agree. "Over and over again, we see people lose time up front, but the end date does not change and what is lost is testing," Sedlak says. "You need to test, debug, and retest. Once you go live, you want to stop debugging and move on to customer service."
Barnes, too, is a firm believer in testing, particularly stress testing, which involves pushing a system to its limits. He cites one customer facility where stress and volume testing revealed significant problems with activities like scanning, labeling, and messaging that caused the warehouse management software and material handling systems to crash. "If they had gone live, they would have shut down for a week," he says. But since the issues were revealed in the testing phase, the company was able to resolve them before operations began.
Farmer emphasizes the importance of testing each segment of a system, then testing the integrated parts, and concluding with operational readiness testing. The last, he says, re-creates a day in the life of the new facility or system. "Treat that like a dress rehearsal," he says. "If you go through all that and the people are trained, it is a non-event when you turn on the switch."
Engage the workforce. This step is particularly important where an existing workforce will make the transition to a new system. "You've got to have buy-in on the floor," Sedlak says. He urges involving line supervisors early in the development process and training them to train the line workers. "That's especially true if you're doing a renovation," he says. "That's harder than bringing up a greenfield project."
Farmer maintains that preparing workers for the transition to a new system must be part of the process from the outset. "You always need a people-readiness work stream," he says. "If you don't, you will not meet the business case. You are really doing change management, and adoption of change is critical to success."
Starovasnik makes a similar point. "The physical changes—those are obvious. But you're also changing the lives of the people who work for you." He suggests engaging supervisory personnel early in the design process. "Their input can be invaluable," he says. "They understand their customers' needs. You want them to see it not as a corporate design, but as their design. It helps if you can establish a sense of ownership that can be translated to the front-line operators."
Look ahead and look back. The end of the project is just the beginning of the operation. Farmer urges companies to establish exactly how the operation will function after it's completed as part of their planning process. In addition, he says, a post-project review to identify lessons learned can prove valuable in the future.
Sometimes, all you need is the right partner to solve your logistics problems.
In 2021, global paint supplier Sherwin Williams faced driver and hazardous material (hazmat) capacity constraints: There simply weren’t enough hazmat drivers available in its fleet to maintain the company’s 90% fleet utilization rate expectations for key partner store deliveries while also meeting growing demand for service. Those challenges threatened to become even more acute in the future, as a competing paint supply company began to scale back its operations in the Pacific Northwest, leaving Sherwin Williams with an opportunity to fill the gap.
The paint supplier needed a logistics partner that could help it overcome the shortage of hazmat drivers while also helping to manage its West Coast trailer pools, out-of-region runs, and ad-hoc freight. It also needed a solution that would meet quarterly and annual fleet budgets.
SCALING UP
Enter ITS Logistics, a third-party logistics service provider (3PL) that offers supply chain solutions for drayage, network transportation, distribution, and fulfillment across North America. ITS proposed a combined owned-asset and asset-light approach that would provide Sherwin Williams with the equivalent of 21 additional drivers. The 3PL would leverage its carrier network to overcome the shortage of hazmat capacity while also certifying its own drivers via a three-month process. Further, ITS would help manage Sherwin Williams’ trailer pools and coordinate carriers, providing the paint company with a single point of contact for transportation.
The project would address cost concerns as well: “ITS Logistics aligned its solution with Sherwin Williams’ budgetary cadence and offered a quarterly business review to align on price structure, adding a level of transparency and trust to the relationship,” according to a case study the partners released earlier this year.
The companies soon sealed the deal and launched the program.
Not long after that, Sherwin Williams began to feel the effects of the anticipated challenges in the Pacific Northwest—but the company was prepared. When the competing paint supply company shuttered its operations, causing demand for Sherwin Williams’ products to spike, ITS injected a blend of owned trailers and carrier power to alleviate equipment challenges, cover all locations and regions, and help the paint supplier scale to meet volume.
CLOSING THE GAPS
The project has helped Sherwin Williams rapidly scale its capacity, meet fleet utilization requirements, manage trailer pools, coordinate carriers, and flex to meet spikes in regional demand.
And the results speak for themselves.
“ITS integrating themselves into our fleet was instrumental in helping increase our outbound volume by 18.4 million pounds [year over year] in the last seven months of 2023,” said Ted Taxon, regional transportation manager at Sherwin Williams, in the case study. “This equated to approximately 460 truckloads of extra freight, a large portion of which ITS [handled] on an ad-hoc basis with no operational constraints or quality issues.”
The partnership also helped Sherwin Williams maintain a 90% fleet utilization rate with big box retailers—an increase from less than 70% prior to the partnership’s launch.
Robots are revolutionizing factories, warehouses, and distribution centers (DCs) around the world, thanks largely to heavy investments in the technology between 2019 and 2021. And although investment has slowed since then, the long-term outlook calls for steady growth over the next four years. According to data from research and consulting firm Interact Analysis, revenues from shipments of industrial robots are forecast to grow nearly 4% per year, on average, between 2024 and 2028 (see Exhibit 1).
EXHIBIT 1: Market forecast for industrial robots - revenuesInteract Analysis
Material handling is among the top applications for all those robots, accounting for one-third of overall robot market revenues in 2023, according to the research. That puts warehouses and DCs on the cutting edge of robotic innovation, with projects that are helping companies reduce costs, optimize labor, and improve productivity throughout their facilities. Here’s a look at two recent projects that demonstrate the kinds of gains companies have achieved by investing in robotic equipment.
FASTER, MORE ACCURATE CYCLE COUNTS
When leaders at MSI Surfaces wanted to get a better handle on their vast inventory of flooring, countertops, tile, and hardscape materials, they turned to warehouse inventory drone provider Corvus Robotics. The seven-year-old company offers a warehouse drone system, called Corvus One, that can be installed and deployed quickly—in what MSI leaders describe as a “plug and play” process. Corvus Robotics’ drones are fully autonomous—they require no external infrastructure, such as beacons or stickers for positioning and navigation, and no human operators. Essentially, all you need is the drone and a landing pad, and you’re in business.
The drones use computer vision and generative AI (artificial intelligence) to “understand” their environment, flying autonomously in both very narrow aisles—passageways as narrow as 50 inches—and in very wide aisles. The Corvus One system relies on obstacle detection to operate safely in warehouses and uses barcode scanning technology to count inventory; the advanced system can read any barcode symbol in any orientation placed anywhere on the front of a carton or pallet.
The system was the perfect answer to the inventory challenges MSI was facing. Its annual physical inventory counts required two to four dedicated warehouse associates, who would manually scan inventory to determine the amount of stock on hand. The process was both time-consuming and error-prone, and often led to inaccuracies. And it created a chain reaction of issues and problems. Fulfillment speed is one example: Lost or misplaced inventory would delay customer deliveries, resulting in dissatisfaction, returns, and unmet expectations. Productivity was also an issue: Workers were often pulled from fulfillment tasks to locate material, slowing overall operations.
MSI Surfaces began using the Corvus One system in 2021, deploying a small number of drones for daily inventory counts at its 300,000-square-foot distribution center (DC) in Orange, California. It quickly scaled up, adding more drones in Orange and expanding the system to three other DCs: in Houston; Savannah, Georgia; and Edison, New Jersey. The company plans to add more drones to the existing sites and expand the system to some of its smaller DCs as well, according to Corvus Robotics spokesperson Andrew Burer.
Those expansion plans are based on solid results: MSI’s inventory accuracy was about 80% prior to the drone implementation, but it quickly jumped to the high 90s—ultimately reaching 99%—after the company initiated the daily drone counts, according to Burer.
“We actually had an incident early on where one of the forklift drivers ran into the landing pad, rendering it inoperable for about a week while the Corvus team fixed it,” Burer recalls. “When we restarted the system, we noticed MSI’s inventory accuracy had dropped down to the 80s. But after flights resumed, accuracy quickly improved back to near perfect.” He adds that such collisions are rare as Corvus mounts landing pads high off the floor to avoid impacts but that accidents can still happen.
Overall, the system has helped speed warehouse operations in two key ways: First, the accuracy improvement means that associates no longer waste time searching for missing material in the warehouse. And second, the associates who used to conduct the physical inventory counts have been reallocated to picking and replenishment—creating a more efficient, and optimized, workforce.
A SAFER, MORE EFFICIENT WAREHOUSE
Robot maker Boston Dynamics is well-known for its Stretch and Spot industrial robots, both of which are at work in warehouses and DCs around the world. Earlier this year, Stretch made its debut in Europe, teaming up with Spot at a fulfillment center run by German retail company Otto Group. The deployment marks the first time Stretch and Spot are being used together—in a partnership designed to improve Otto Group’s warehousing operations by increasing efficiency and making warehouse work safer and more attractive to workers.
The partnership is part of a two-year project in which Boston Dynamics will deploy dozens of its warehouse robots in Otto Group’s European DCs. The first location is a fulfillment site operated by Hermes, the company’s parcel delivery subsidiary, in Haldensleben, Germany—a facility that handles as many as 40,000 cartons of goods on peak days.
At the site, Stretch—which is a mobile case-handling robot—autonomously unloads ocean containers and trailers, using its advanced perception system to pick and place boxes onto a telescoping conveyor inside the container or trailer. Spot—a quadruped robot—helps with predictive maintenance by collecting thermal data and performing acoustic and visual detection tasks throughout the facility to reduce unplanned downtime and energy costs. One of Spot’s jobs is to detect air leaks in the facility’s warehouse automation systems; future duties may include conveyor vibration detection, according to leaders at Otto Group.
Both Stretch and Spot will help the Haldensleben facility run more efficiently, especially during fall peak season when volume increases and work intensifies. The addition of Stretch addresses safety and comfort issues as well: Trailer unloading—a process that entails repeatedly lifting and moving heavy boxes inside a trailer, which can be dark, dirty, cold, and/or hot, depending on the weather—tends to be unappealing to workers. Along with reducing the amount of labor required, automating these tasks will have the added benefit for European facilities of helping them comply with EU (European Union) regulations limiting the amount of time workers can spend in those conditions.
Essentially, the robots are making life easier on the warehouse floor and for the company at large.
“Stretch is going to have a ton of benefits for customers here in the EU,” Andrew Brueckner, of Boston Dynamics, said in a recent case study on the project.
The trucking industry faces a range of challenges these days, particularly when it comes to load planning—a resource-intensive task that often results in suboptimal decisions, unnecessary empty miles, late deliveries, and inefficient asset utilization. What’s more, delays in decision-making due to a lack of real-time insights can hinder operational efficiency, making cost management a constant struggle.
Truckload carrier Paper Transport Inc. (PTI) experienced this firsthand when the company sought to expand its over the-road (OTR), intermodal, and brokerage offerings to include dedicated fleet services for high-volume shippers—adding a layer of complexity to the business. The additional personnel required for such a move would be extremely costly, leading PTI to investigate technology solutions that could help close the gap.
Enter Freight Science and its intelligent decision-recommendation and automation platform.
PTI implemented Freight Science’s artificial intelligence (AI)-driven load planning optimization solution earlier this year, giving the carrier a high-tech advantage as it launched the new service.
“As PTI tried to diversify … we found that we needed a technological solution that would allow us to process [information] faster,” explains Jared Stedl, chief commercial officer for PTI, emphasizing the high volume of outbound shipments and unique freight characteristics of its targeted dedicated-fleet customers.
The Freight Science platform allowed PTI to apply its signature high-quality service to those needs, all while handling the daily challenges of managing drivers and navigating route disruptions.
STREAMLINING PROCESSES
Dedicated fleets face challenges that evolve from day to day and minute to minute, including truck breakdowns, drivers calling in sick, and rescheduled appointment times. PTI needed a tool that allowed for a real-time view of the fleet, ultimately enabling its team to adjust truck and driver allocation to meet those challenges.
The Freight Science solution filled the bill. The platform uses advanced analytics and algorithms to give carriers better visibility into operations while automating the decision-making process. By combining streaming data, a carrier’s transportation management system (TMS), machine learning, and decision science, the solution allows carriers to deploy their fleets more efficiently while accurately forecasting future needs, according to Freight Science.
In PTI’s case, Freight Science’s software integrates with the carrier’s TMS, real-time electronic logging device (ELD) data, and other external data, feeding an AI model that generates an optimized load plan for the planner.
“We’re an integrated data analytics company for trucking companies,” explains Matt Foster, Freight Science’s president and CEO. “We’re talking about AI.”
The benefits of the real-time data are difficult to overstate.
“We’ve been able to execute in the toughest of situations because we’ve got real, live data on how long each event is actually going to take and a system to aid and even automate the decision-making process,” says Chad Borley, PTI’s operations manager. “From what traffic patterns we are battling in the morning and evening with rush hour and things like that, to the impact of additional miles to a route, or even location-specific dwell times, it’s been a huge differentiator for us.”
REALIZING RESULTS
A case in point: the collapse of Baltimore’s Francis Scott Key Bridge in March. PTI was scheduled to go live with a new dedicated account in the area just days after the collapse, which would mean rerouting and the potential for longer transit times. Instead of recalculating based on assumptions or latent data, PTI was able to reroute freight based on real-time information and analytics to give the customer timely updates.
“With the bridge going out, that changed our ability to make as many turns a day as the customer would expect,” Stedl explains. “But one of the things Freight Science could do [was to] quickly [assess] how much of an impact that traffic would have [and] what the turns [would] be based on what’s happening on the ground.
“So we were able to go back to the customer and readjust expectations in a real way that made sense, using data. Now expectations can be reset¾we’re not asking for forgiveness when there’s no reason for it.”
The system’s advanced algorithms make load planning more cost-effective and scalable as well. The platform allows PTI to monitor trucks, trailers, and driver hours in real time, recommending additional loads with remaining driver hours that would otherwise be wasted.
And they’re doing it all with much less. Stedl says tasks that used to require five people and hours of work can now be accomplished by one person in mere minutes, improving productivity and profitability while reducing labor and operational costs.
Terms of the deal were not disclosed, but Aptean said the move will add new capabilities to its warehouse management and supply chain management offerings for manufacturers, wholesalers, distributors, retailers, and 3PLs. Aptean currently provides enterprise resource planning (ERP), transportation management systems (TMS), and product lifecycle management (PLM) platforms.
Founded in 1980 and headquartered in Durham, U.K., Indigo Software provides software designed for mid-market organizations, giving users real-time visibility and management from the initial receipt of stock all the way through to final dispatch of the finished product. That enables organizations to optimize an array of warehouse operations including receiving, storage, picking, packing, and shipping, the firm says.
Specific sectors served by Indigo Software include the food and beverage, fashion and apparel, fast moving consumer goods, automotive, manufacturing, 3PL, chemicals, and wholesale / distribution verticals.
Schneider says its FreightPower platform now offers owner-operators significantly more access to Schneider’s range of freight options. That can help drivers to generate revenue and strengthen their business through: increased access to freight, high drop and hook rates of over 95% of loads, and a trip planning feature that calculates road miles.
“Collaborating with owner-operators is an important component in the success of our business and the reliable service we can provide customers, which is why the network has grown tremendously in the last 25 years,” Schneider Senior Vice President and General Manager of Truckload and Mexico John Bozec said in a release. "We want to invest in tools that support owner-operators in running and growing their businesses. With Schneider FreightPower, they gain access to better load management, increasing their productivity and revenue potential.”