The chief information officer for BNSF Railway imagines the day when the railroad might use drones to inspect its vast network of rail bed and bridges, with the unmanned aircraft sending data back to the appropriate engineering and maintenance locations.
An executive for Home Depot foresees a salesperson designing a customer's new kitchen on a tablet, making the sale, and submitting the order to start the production process. On the store floor, sales personnel—and customers themselves—will be able to pinpoint the location of inventory in the store or in nearby outlets.
The CIO for trucker J.B. Hunt describes the evolution of mobile technology that will eventually lead to tagging every shipment and providing tracking and delivery details in real time.
The executives described those visions during a panel at the Council of Supply Chain Management Professionals' (CSCMP) annual conference in October. What those stories illustrate is the potential of mobile technology to transform supply chains. (Although most people think of mobile technology as smartphones, tablets, and similar devices, the term encompasses any device using cellular communication to convey information. And that could include an unmanned aircraft if it's furnished with communication equipment for wireless networking.)
Industry experts believe that businesses with diverse supply chains will benefit from the visibility and swift communications offered by this technology. At the same time the technology is taking on ever-greater roles in the distribution center, it is also connecting the DC to every part of the business supply chain.
BEYOND THE DC WALLS
For evidence of the growing popularity of mobile devices for DC applications, you need look no farther than a study conducted among warehouse professionals earlier this year by mobile technology developer Motorola Solutions Inc. The survey found that nearly two-thirds plan to automate more of their work processes over the next five years. The respondents further expect to see the use of pen and paper drop off substantially, replaced by handheld mobile computers and tablets for cycle counting and inventory validation.
But that's just one example of how ubiquitous the technology is becoming. "DCs are one part of a bigger equation," says Fernando Alvarez, vice president and leader of Capgemini's Mobile Solutions practice. Mobile technologies are used far beyond the four walls, with repercussions for complete supply chains, he says. Those technologies are not only crucial to helping manage materials and production, but they have moved deeply into services as well.
A panel discussion at the CSCMP conference provided numerous examples of how companies will use mobile technology in the supply chain. Jo-ann Olsovsky, the BNSF CIO, said the railway began rolling out mobile technologies in the 1980s. "We were wireless before it was called 'wireless,'" she told the CSCMP audience. Taking advantage of BNSF's large microwave network, railroad employees use mobile handheld devices to help manage such things as work orders and train movements. Recent upgrades in cellular technology deployed across the railroad's network have provided significant productivity gains, she said. "With 2,000-plus locations, it is paramount that we're sure the people running the railroad have what they need to react to customer needs," she said.
The railroad plans to make use of rugged Windows-based tablets across the three major segments of its rail business—transportation, engineering, and maintenance. The rollout will begin in the engineering segment, where workers will be equipped with mobile devices for managing track signals and other tasks.
Bryan Ward, director of logistics for The Home Depot, told the CSCMP audience that the company is making a number of investments in mobile technology. Some will sound familiar: The company is providing delivery drivers with mobile devices from Motorola for navigation and signature capture, among other uses. For its appliance delivery service, the company has developed an iPhone app to help track and manage those deliveries. "It all rolls back to our delivery management systems," he said. "In the past, we've done that manually with paper and faxes that tied up store associates."
He sees particular utility for mobile technology in the company's response to disasters such as major storms, when demand for building products is high but supply chains are disrupted. As an example, he described using GPS units to track generator shipments into disaster zones. "We can suck information in, and we have the algorithms to tell stores when products will arrive. That sounds easy, but when it comes to disasters, everything is out the window."
Kay Palmer, the Hunt CIO, described how the use of mobile technology has evolved at her company, from tracking tractors, to tracking trailers, to eventually using RFID or similar technologies to track individual pieces of a load. The drawback to that, she says, is cost. Because it's unlikely the company will be able to recover the tags, she says, the price of tags still must come down before their use is practical. But that day will come, she expects.
MEANWHILE, BACK IN THE WAREHOUSE
Wireless technologies are nothing new in distribution centers, of course. Wireless handhelds and similar untethered technologies have been in use for decades. What's changing is that they are becoming more compact, more robust, more reliable, and more multifunctional. Rob Armstrong, who leads marketing for manufacturing and logistics for Motorola in North America, says that mobile technologies had their first warehousing applications in picking, but that over time they have spread throughout operations, including receiving, putaway, replenishment, and cycle counting. All that adds up to better traceability and control, he says, allowing for development of lean supply chains.
Today's mobile technologies also broaden the communication "footprint." Because they use cellular communication, they can send information over a wider geography than the type of wireless technology that's been used in DCs for the past two decades.
Mark Wheeler, director of warehouse solutions for Motorola, says he is seeing wider adoption of mobile technologies in areas like the food industry. That's partly the result of recent government mandates that demand end-to-end visibility of food moving through the supply chain, he says. "Food manufacturers, distributors, and even retailers want better control of inventory."
As for how that might be achieved, Bruce Stubbs, director of industry marketing for Intermec, which provides printers, mobile computers, and other tracing technologies, says smart mobile printers can be used at the point of harvest to create labels with traceability information. The bar codes on those labels are readable by data capture technologies at each step in the supply chain—transportation, processing, manufacturing, and distribution. "It's a complete end-to-end story that covers the point of harvest to the point of sale," he says. That tracing capability is crucially important for consumer safety, he says, but it is also critical to brand protection.
Alvarez offers a similar story, citing a Capgemini project that involves using RFID chips and other technologies to track livestock—individual animals—through their entire lives: recording how they are fed, when and where they are sold, who purchased them, and so on right up through the manufacture and packaging of final products.
End-to-end supply chain visibility and control may still be far off. The technology is still too expensive for many companies to deploy widely, says Alvarez. But a combination of factors—regulation in the food and pharmaceutical industries, for example, and the never-ending pressure to compress supply chains—are likely to drive further adoption.
