David Maloney has been a journalist for more than 35 years and is currently the group editorial director for DC Velocity and Supply Chain Quarterly magazines. In this role, he is responsible for the editorial content of both brands of Agile Business Media. Dave joined DC Velocity in April of 2004. Prior to that, he was a senior editor for Modern Materials Handling magazine. Dave also has extensive experience as a broadcast journalist. Before writing for supply chain publications, he was a journalist, television producer and director in Pittsburgh. Dave combines a background of reporting on logistics with his video production experience to bring new opportunities to DC Velocity readers, including web videos highlighting top distribution and logistics facilities, webcasts and other cross-media projects. He continues to live and work in the Pittsburgh area.
Maybe you're just not able to get orders out the door as fast as you used to. Or your operating costs have been creeping up and you're running into delivery delays. Or you've noticed workers resorting to manual processes or work-arounds for tasks that were supposed to be fully automated.
All of these can be signs that something's amiss with the software that drives your distribution and transportation operations. Over time, even the best designed system can become a drag on performance if it's not kept up to date and modified as the user's needs change.
Although the advantages of regular software tune-ups might seem obvious, companies sometimes shy away from the idea because they're afraid the fixes will be expensive. But that's a misconception, software specialists say. Bringing an underperforming system back up to speed doesn't always require a major upgrade or a costly replacement. In many instances, all that's needed is a tune-up. "There is low-hanging fruit that does not require a full upgrade," says Jeff Mueller, vice president of Sedlak Management Consultants, which conducts software evaluations for distribution and supply chain operations.
In some cases, the fix turns out to be as simple as a few minor tweaks to the system. In others, it's as easy as adding one or more modules to the core system (say, a module for labor management, inventory optimization, slotting, or electronic data interchange). The user may not even have to buy the module (or modules) it needs. Software vendors say it's not uncommon to find that a client already owns the required programs but has never gotten around to implementing them.
"Our customers, for instance, use only about 30 percent of a software system's capabilities," says Mike Dunn, group vice president of sales for Fortna, another consulting and design firm. What often happens, he says, is that clients opt for a phased-in approach when they go to install new software. That is, rather than implement all of the modules at once, they decide to tackle the project in stages in order to minimize disruption. Trouble is, they never move on to the second and third phases. The modules end up gathering dust until a problem arises.
Trigger points
So how do you know when your software needs a tune-up? In many cases, the signs are obvious. For instance, with enterprise-level software, a big tip-off is rising operational costs (or costs that are out of line with expected norms). But performance problems aren't the only indicator that a software checkup is in order. You'll also want to re-evaluate the system if your company has recently made major structural changes to its operations —such as acquiring competitors, opening new distribution centers, or consolidating operations.
In the distribution end of the operation, indicators that your software might require some attention include lengthy order turnaround times, excessive touch points within a distribution center, and spiraling costs. Other warning signs are excessive travel times within a facility, difficulty locating products, and a disproportionate amount of paper-based processing. (See sidebar for a list of signs that your warehouse management system (WMS) might need a tune-up.)
When it comes to transportation operations, red flags include operational delays, a high percentage of empty backhauls, rising costs, and less-than-optimal vehicle cubing. These types of problems typically arise when a company changes its business strategy without making appropriate adjustments to its TMS —for instance, a supplier whose focus has shifted to online sales but continues to use software designed for LTL —rather than parcel —shippers. For that reason, the experts advise users to re-evaluate their software whenever the company introduces a process change that affects transportation.
Where to go for help
Let's say you've examined your software and found it wanting. Where can you turn for help? A good place to start is with the company that either supplied or implemented the software in the first place. These types of specialists have the experience to conduct an evaluation of the client's software usage and recommend improvements.
Some software vendors include evaluation and update services as part of their ongoing maintenance contracts. One such supplier is itelligence Inc., which provides implementation and support services to users of SAP solutions. "We take an active part with our SAP maintenance customers to keep them up to date and informed of what is new with the software. We do it proactively," says Stefan Hoffmann, the company's industry solution manager.
Another option is to bring in an outside specialist. Typically, these companies come in and review the client's operations and then develop a list of 10 to 20 recommendations for boosting the system's effectiveness. The client can then start with the easiest fixes and move on to the others as time and budgets permit.
"It helps to have some level of evaluation from the outside," notes Sedlak's Mueller. "It brings another perspective, outside thoughts, and ideas."
Regardless of who provides the support, Dunn of Fortna cautions software users not to let too much time elapse between checkups. "Tune-ups are critical for getting optimization out of the software, and they are not done nearly often enough," he says.
As for the optimal service interval, Dunn recommends annual software assessments. If a company waits too long to make necessary changes or has major needs that aren't being addressed, the situation may eventually reach a point where a tune-up is not enough, he explains. The company might have no choice but to invest in an upgrade or install a new system altogether.
Software only goes so far
As effective as software modifications can be, sometimes they're simply not enough to provide the desired result. In these cases, adjustments to the material handling systems or other processes may be needed to gain additional functionality.
"Software may get us 80 percent of where we want to be, but it might take changing the processes to get the rest," says Mueller. "But it always starts with evaluating where you want those processes to be and then making the software work for that."
Of course, this assumes the software has the capacity to accommodate changes in the first place. That's where the initial software selection comes in. To ensure their long-term needs are met, the experts advise users to pick systems that are flexible and will allow them to add functionality as their business grows.
"More and more, deciding on a software system can be a 10- to 15-year decision. It helps to choose software that can provide new functionality as it is introduced to the market," says Hoffmann.
Your WMS may need a tune-up if ...
... your business has changed and the new flow of goods calls for new processing methods.
... you're not familiar with many of the WMS's features.
... you suspect additional modules or bolt-on applications would provide further optimization opportunities, but you're not sure.
... you feel your order fulfillment operations require too much travel time or too many product touches.
... your operators rely heavily on spreadsheets or perform several system look-ups prior to completing a transaction.
... you're still picking orders in sequence even though you believe batching orders by type or characteristics would maximize throughput.
... your warehouse layout/flow hasn't changed in the last 10 years even though your business has undergone major changes—like a shift to e-commerce or the addition of a wholesale channel.
... your workers resort to a lot of manual processes or work-arounds for operations that should be systemically driven.
Supply chain planning (SCP) leaders working on transformation efforts are focused on two major high-impact technology trends, including composite AI and supply chain data governance, according to a study from Gartner, Inc.
"SCP leaders are in the process of developing transformation roadmaps that will prioritize delivering on advanced decision intelligence and automated decision making," Eva Dawkins, Director Analyst in Gartner’s Supply Chain practice, said in a release. "Composite AI, which is the combined application of different AI techniques to improve learning efficiency, will drive the optimization and automation of many planning activities at scale, while supply chain data governance is the foundational key for digital transformation.”
Their pursuit of those roadmaps is often complicated by frequent disruptions and the rapid pace of technological innovation. But Gartner says those leaders can accelerate the realized value of technology investments by facilitating a shift from IT-led to business-led digital leadership, with SCP leaders taking ownership of multidisciplinary teams to advance business operations, channels and products.
“A sound data governance strategy supports advanced technologies, such as composite AI, while also facilitating collaboration throughout the supply chain technology ecosystem,” said Dawkins. “Without attention to data governance, SCP leaders will likely struggle to achieve their expected ROI on key technology investments.”
The U.S. manufacturing sector has become an engine of new job creation over the past four years, thanks to a combination of federal incentives and mega-trends like nearshoring and the clean energy boom, according to the industrial real estate firm Savills.
While those manufacturing announcements have softened slightly from their 2022 high point, they remain historically elevated. And the sector’s growth outlook remains strong, regardless of the results of the November U.S. presidential election, the company said in its September “Savills Manufacturing Report.”
From 2021 to 2024, over 995,000 new U.S. manufacturing jobs were announced, with two thirds in advanced sectors like electric vehicles (EVs) and batteries, semiconductors, clean energy, and biomanufacturing. After peaking at 350,000 news jobs in 2022, the growth pace has slowed, with 2024 expected to see just over half that number.
But the ingredients are in place to sustain the hot temperature of American manufacturing expansion in 2025 and beyond, the company said. According to Savills, that’s because the U.S. manufacturing revival is fueled by $910 billion in federal incentives—including the Inflation Reduction Act, CHIPS and Science Act, and Infrastructure Investment and Jobs Act—much of which has not yet been spent. Domestic production is also expected to be boosted by new tariffs, including a planned rise in semiconductor tariffs to 50% in 2025 and an increase in tariffs on Chinese EVs from 25% to 100%.
Certain geographical regions will see greater manufacturing growth than others, since just eight states account for 47% of new manufacturing jobs and over 6.3 billion square feet of industrial space, with 197 million more square feet under development. They are: Arizona, Georgia, Michigan, Ohio, North Carolina, South Carolina, Texas, and Tennessee.
Across the border, Mexico’s manufacturing sector has also seen “revolutionary” growth driven by nearshoring strategies targeting U.S. markets and offering lower-cost labor, with a workforce that is now even cheaper than in China. Over the past four years, that country has launched 27 new plants, each creating over 500 jobs. Unlike the U.S. focus on tech manufacturing, Mexico focuses on traditional sectors such as automative parts, appliances, and consumer goods.
Looking at the future, the U.S. manufacturing sector’s growth outlook remains strong, regardless of the results of November’s presidential election, Savills said. That’s because both candidates favor protectionist trade policies, and since significant change to federal incentives would require a single party to control both the legislative and executive branches. Rather than relying on changes in political leadership, future growth of U.S. manufacturing now hinges on finding affordable, reliable power amid increasing competition between manufacturing sites and data centers, Savills said.
The British logistics robot vendor Dexory this week said it has raised $80 million in venture funding to support an expansion of its artificial intelligence (AI) powered features, grow its global team, and accelerate the deployment of its autonomous robots.
A “significant focus” continues to be on expanding across the U.S. market, where Dexory is live with customers in seven states and last month opened a U.S. headquarters in Nashville. The Series B will also enhance development and production facilities at its UK headquarters, the firm said.
The “series B” funding round was led by DTCP, with participation from Latitude Ventures, Wave-X and Bootstrap Europe, along with existing investors Atomico, Lakestar, Capnamic, and several angels from the logistics industry. With the close of the round, Dexory has now raised $120 million over the past three years.
Dexory says its product, DexoryView, provides real-time visibility across warehouses of any size through its autonomous mobile robots and AI. The rolling bots use sensor and image data and continuous data collection to perform rapid warehouse scans and create digital twins of warehouse spaces, allowing for optimized performance and future scenario simulations.
Originally announced in September, the move will allow Deutsche Bahn to “fully focus on restructuring the rail infrastructure in Germany and providing climate-friendly passenger and freight transport operations in Germany and Europe,” Werner Gatzer, Chairman of the DB Supervisory Board, said in a release.
For its purchase price, DSV gains an organization with around 72,700 employees at over 1,850 locations. The new owner says it plans to investment around one billion euros in coming years to promote additional growth in German operations. Together, DSV and Schenker will have a combined workforce of approximately 147,000 employees in more than 90 countries, earning pro forma revenue of approximately $43.3 billion (based on 2023 numbers), DSV said.
After removing that unit, Deutsche Bahn retains its core business called the “Systemverbund Bahn,” which includes passenger transport activities in Germany, rail freight activities, operational service units, and railroad infrastructure companies. The DB Group, headquartered in Berlin, employs around 340,000 people.
“We have set clear goals to structurally modernize Deutsche Bahn in the areas of infrastructure, operations and profitability and focus on the core business. The proceeds from the sale will significantly reduce DB’s debt and thus make an important contribution to the financial stability of the DB Group. At the same time, DB Schenker will gain a strong strategic owner in DSV,” Deutsche Bahn CEO Richard Lutz said in a release.
Transportation industry veteran Anne Reinke will become president & CEO of trade group the Intermodal Association of North America (IANA) at the end of the year, stepping into the position from her previous post leading third party logistics (3PL) trade group the Transportation Intermediaries Association (TIA), both organizations said today.
Meanwhile, TIA today announced that insider Christopher Burroughs would fill Reinke’s shoes as president & CEO. Burroughs has been with TIA for 13 years, most recently as its vice president of Government Affairs for the past six years, during which time he oversaw all legislative and regulatory efforts before Congress and the federal agencies.
Before her four years leading TIA, Reinke spent two years as Deputy Assistant Secretary with the U.S. Department of Transportation and 16 years with CSX Corporation.