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.
Progress in generative AI (GenAI) is poised to impact business procurement processes through advancements in three areas—agentic reasoning, multimodality, and AI agents—according to Gartner Inc.
Those functions will redefine how procurement operates and significantly impact the agendas of chief procurement officers (CPOs). And 72% of procurement leaders are already prioritizing the integration of GenAI into their strategies, thus highlighting the recognition of its potential to drive significant improvements in efficiency and effectiveness, Gartner found in a survey conducted in July, 2024, with 258 global respondents.
Gartner defined the new functions as follows:
Agentic reasoning in GenAI allows for advanced decision-making processes that mimic human-like cognition. This capability will enable procurement functions to leverage GenAI to analyze complex scenarios and make informed decisions with greater accuracy and speed.
Multimodality refers to the ability of GenAI to process and integrate multiple forms of data, such as text, images, and audio. This will make GenAI more intuitively consumable to users and enhance procurement's ability to gather and analyze diverse information sources, leading to more comprehensive insights and better-informed strategies.
AI agents are autonomous systems that can perform tasks and make decisions on behalf of human operators. In procurement, these agents will automate procurement tasks and activities, freeing up human resources to focus on strategic initiatives, complex problem-solving and edge cases.
As CPOs look to maximize the value of GenAI in procurement, the study recommended three starting points: double down on data governance, develop and incorporate privacy standards into contracts, and increase procurement thresholds.
“These advancements will usher procurement into an era where the distance between ideas, insights, and actions will shorten rapidly,” Ryan Polk, senior director analyst in Gartner’s Supply Chain practice, said in a release. "Procurement leaders who build their foundation now through a focus on data quality, privacy and risk management have the potential to reap new levels of productivity and strategic value from the technology."
Businesses are cautiously optimistic as peak holiday shipping season draws near, with many anticipating year-over-year sales increases as they continue to battle challenging supply chain conditions.
That’s according to the DHL 2024 Peak Season Shipping Survey, released today by express shipping service provider DHL Express U.S. The company surveyed small and medium-sized enterprises (SMEs) to gauge their holiday business outlook compared to last year and found that a mix of optimism and “strategic caution” prevail ahead of this year’s peak.
Nearly half (48%) of the SMEs surveyed said they expect higher holiday sales compared to 2023, while 44% said they expect sales to remain on par with last year, and just 8% said they foresee a decline. Respondents said the main challenges to hitting those goals are supply chain problems (35%), inflation and fluctuating consumer demand (34%), staffing (16%), and inventory challenges (14%).
But respondents said they have strategies in place to tackle those issues. Many said they began preparing for holiday season earlier this year—with 45% saying they started planning in Q2 or earlier, up from 39% last year. Other strategies include expanding into international markets (35%) and leveraging holiday discounts (32%).
Sixty percent of respondents said they will prioritize personalized customer service as a way to enhance customer interactions and loyalty this year. Still others said they will invest in enhanced web and mobile experiences (23%) and eco-friendly practices (13%) to draw customers this holiday season.
That challenge is one of the reasons that fewer shoppers overall are satisfied with their shopping experiences lately, Lincolnshire, Illinois-based Zebra said in its “17th Annual Global Shopper Study.”th Annual Global Shopper Study.” While 85% of shoppers last year were satisfied with both the in-store and online experiences, only 81% in 2024 are satisfied with the in-store experience and just 79% with online shopping.
In response, most retailers (78%) say they are investing in technology tools that can help both frontline workers and those watching operations from behind the scenes to minimize theft and loss, Zebra said.
Just 38% of retailers currently use AI-based prescriptive analytics for loss prevention, but a much larger 50% say they plan to use it in the next 1-3 years. That was followed by self-checkout cameras and sensors (45%), computer vision (46%), and RFID tags and readers (42%) that are planned for use within the next three years, specifically for loss prevention.
Those strategies could help improve the brick and mortar shopping experience, since 78% of shoppers say it’s annoying when products are locked up or secured within cases. Adding to that frustration is that it’s hard to find an associate while shopping in stores these days, according to 70% of consumers. In response, some just walk out; one in five shoppers has left a store without getting what they needed because a retail associate wasn’t available to help, an increase over the past two years.
The survey also identified additional frustrations faced by retailers and associates:
challenges with offering easy options for click-and-collect or returns, despite high shopper demand for them
the struggle to confirm current inventory and pricing
lingering labor shortages and increasing loss incidents, even as shoppers return to stores
“Many retailers are laying the groundwork to build a modern store experience,” Matt Guiste, Global Retail Technology Strategist, Zebra Technologies, said in a release. “They are investing in mobile and intelligent automation technologies to help inform operational decisions and enable associates to do the things that keep shoppers happy.”
The survey was administered online by Azure Knowledge Corporation and included 4,200 adult shoppers (age 18+), decision-makers, and associates, who replied to questions about the topics of shopper experience, device and technology usage, and delivery and fulfillment in store and online.
An eight-year veteran of the Georgia company, Hakala will begin his new role on January 1, when the current CEO, Tero Peltomäki, will retire after a long and noteworthy career, continuing as a member of the board of directors, Cimcorp said.
According to Hakala, automation is an inevitable course in Cimcorp’s core sectors, and the company’s end-to-end capabilities will be crucial for clients’ success. In the past, both the tire and grocery retail industries have automated individual machines and parts of their operations. In recent years, automation has spread throughout the facilities, as companies want to be able to see their entire operation with one look, utilize analytics, optimize processes, and lead with data.
“Cimcorp has always grown by starting small in the new business segments. We’ve created one solution first, and as we’ve gained more knowledge of our clients’ challenges, we have been able to expand,” Hakala said in a release. “In every phase, we aim to bring our experience to the table and even challenge the client’s initial perspective. We are interested in what our client does and how it could be done better and more efficiently.”
Although many shoppers will
return to physical stores this holiday season, online shopping remains a driving force behind peak-season shipping challenges, especially when it comes to the last mile. Consumers still want fast, free shipping if they can get it—without any delays or disruptions to their holiday deliveries.
One disruptor that gets a lot of headlines this time of year is package theft—committed by so-called “porch pirates.” These are thieves who snatch parcels from front stairs, side porches, and driveways in neighborhoods across the country. The problem adds up to billions of dollars in stolen merchandise each year—not to mention headaches for shippers, parcel delivery companies, and, of course, consumers.
Given the scope of the problem, it’s no wonder online shoppers are worried about it—especially during holiday season. In its annual report on package theft trends, released in October, the
security-focused research and product review firm Security.org found that:
17% of Americans had a package stolen in the past three months, with the typical stolen parcel worth about $50. Some 44% said they’d had a package taken at some point in their life.
Package thieves poached more than $8 billion in merchandise over the past year.
18% of adults said they’d had a package stolen that contained a gift for someone else.
Ahead of the holiday season, 88% of adults said they were worried about theft of online purchases, with more than a quarter saying they were “extremely” or “very” concerned.
But it doesn’t have to be that way. There are some low-tech steps consumers can take to help guard against porch piracy along with some high-tech logistics-focused innovations in the pipeline that can protect deliveries in the last mile. First, some common-sense advice on avoiding package theft from the Security.org research:
Install a doorbell camera, which is a relatively low-cost deterrent.
Bring packages inside promptly or arrange to have them delivered to a secure location if no one will be at home.
Consider using click-and-collect options when possible.
If the retailer allows you to specify delivery-time windows, consider doing so to avoid having packages sit outside for extended periods.
These steps may sound basic, but they are by no means a given: Fewer than half of Americans consider the timing of deliveries, less than a third have a doorbell camera, and nearly one-fifth take no precautions to prevent package theft, according to the research.
Tech vendors are stepping up to help. One example is
Arrive AI, which develops smart mailboxes for last-mile delivery and pickup. The company says its Mailbox-as-a-Service (MaaS) platform will revolutionize the last mile by building a network of parcel-storage boxes that can be accessed by people, drones, or robots. In a nutshell: Packages are placed into a weatherproof box via drone, robot, driverless carrier, or traditional delivery method—and no one other than the rightful owner can access it.
Although the platform is still in development, the company already offers solutions for business clients looking to secure high-value deliveries and sensitive shipments. The health-care industry is one example: Arrive AI offers secure drone delivery of medical supplies, prescriptions, lab samples, and the like to hospitals and other health-care facilities. The platform provides real-time tracking, chain-of-custody controls, and theft-prevention features. Arrive is conducting short-term deployments between logistics companies and health-care partners now, according to a company spokesperson.
The MaaS solution has a pretty high cool factor. And the common-sense best practices just seem like solid advice. Maybe combining both is the key to a more secure last mile—during peak shipping season and throughout the year as well.