As the pandemic recedes, Michael Mikitka, executive vice president of the Warehousing Education and Research Council (WERC), is more than ready to get back to the business of education. The group’s recent annual conference was just the start.
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.
Michael Mikitka has worked for or led trade associations for most of his career. He began with the Property Loss Research Bureau (PLRB), a trade association of property and casualty insurance companies. It was there that he learned to organize and manage education programs and develop an industry trade show. That experience served him well when in 2000, he entered the supply chain arena, joining the staff of the Warehousing Education and Research Council, better known in the industry as WERC.
Mikitka first served as senior director of the organization’s flagship annual conference and managed WERC’s network of chapters. In 2009, WERC’s board of directors appointed him CEO. He remained in that role until August 2020, when WERC came under the umbrella of MHI, the nation’s largest material handling, logistics, and supply chain association.
Mikitka’s new role is executive vice president of the MHI Knowledge Center and WERC. He is responsible for member engagement and influence as well as overseeing the ongoing education, research, and professional development services that WERC members have enjoyed since its founding in 1977. He recently spoke with DC Velocity Group Editorial Director David Maloney about the latest happenings at WERC.
Q: Could you describe the role of the Warehousing Education and Research Council within the supply chain management profession?
A: The Warehousing Education and Research Council, WERC, is an association of professionals who manage logistics throughout the supply chain. Our focus is on best practices in warehousing as well as the quantitative and qualitative metrics of warehousing and distribution, and warehousing’s role in the overall supply chain.
Q: You started at WERC in 2000, which is more than 20 years ago. A lot has happened in the industry since then. What are the most significant changes you’ve seen during your time at WERC?
A: When I started at WERC, my first job was to focus on its 2001 conference. I remember meeting with the committee at that time and hearing a lot of talk about these online orders—internet orders and e-commerce orders. I’m not even sure if it was called that back then, but it was all about the rise of e-commerce, what it meant, and how companies were handling it. It was a very big deal at the time along with some issues and mandates that were coming down regarding RFID (radio-frequency identification). So, it was an interesting and exciting time.
Obviously, the rise of e-commerce and the e-commerce–driven advances in technology that have taken place over the last 20 years have been amazing and have made an incredible impact. So, the most significant change has been the influence of e-commerce.
But while a lot has changed, a lot has also stayed the same. The pillars and the core of supply chain—people, process, and technology—are still at the heart of it, no matter how fulfillment takes place.
Q: And that e-commerce explosion has really changed the technologies that are used for fulfillment, such as the new types of automated equipment.
A: It has, and we are starting to see a shift again, as there’s been an even bigger push toward automation with some of the workforce challenges and disruptions we’ve experienced over the last two years. Companies are also relaxing some of their expectations regarding their return on investment [in automated systems], knowing that it might take a little bit longer. But we definitely see more of a push in that direction.
Q: You just touched on some of the lingering effects of the pandemic. What are WERC members’ top challenges right now?
A: I think they are similar to what a lot of industries are facing. Obviously, the squeeze with the workforce and the availability of labor. Then there are still regulations dictating what they can do and how they can do it. And of course there are the transportation challenges, the logjams at the ports, and the general supply chain issues that we hear about in the news every day.
Q: WERC became a part of MHI in August 2020. Could you describe the role that you play within MHI and the opportunities presented by the MHI/WERC merger for WERC members?
A: Sure. I have the benefit of having a foot in both organizations, if you will, with oversight of MHI’s Knowledge Center and my continuing role with WERC. With the acquisition came opportunities to look at the supply chain and logistics more holistically. We try to serve both those who provide products and services to the industry and those who use those products and services, the practitioners.
The acquisition provided an opportunity for us to step back and look at the industry together and come up with a collaborative approach. Both organizations see value in maintaining our identities and maintaining our audiences. MHI is a trade association, so its members are companies, whereas WERC is a professional association and our members are individuals. So, how we focus on and how we deliver our services to those two audiences are different. But ultimately, we each have things that we can offer that provide value for both of our groups. So, the collaboration and acquisition have provided opportunities to make products and services available to a greater audience.
Q: WERC recently hosted its first in-person annual conference after two years of being virtual. You were in Louisville, Kentucky, the first week of May. Can you share some highlights of the event?
A: The conference was peer-developed as it has always been, so professionals from a number of companies helped to plan the program. All of our content is always developed by the members for the members and focuses on the takeaways that people will leave the conference with.
This year, there was a big push on workforce issues around retention and hiring. We focused on the impact of automation, evaluating opportunities, assessing what attendees’ needs are, and the core competencies of warehousing and the processes that take place—whether it’s trade issues, transportation issues, or anything that impacts our members and their ability to do their jobs and provide their products and services to their customers.
Q: As you mentioned earlier, WERC’s membership is made up of practitioners. Because of that, education has always been a very strong focus for the group. Could you talk about some of the educational opportunities that are available to your members throughout the year?
A: Certainly. As we see Covid winding down, our chapters are becoming more active, so we’re looking at bringing back local opportunities for facility tours or speaker events. Our Texas chapter last year brought back its regional conference. It was well attended, and we are looking forward to doing that again. So these days, we can deliver our content in a number of different ways, whether it is face-to-face or whether it is online through our series of webcasts.
Q: WERC and DC Velocity have collaborated for many years on the annual Warehouse Metrics study. What was the focus of this year’s study?
A: This year’s study had two areas of focus. We looked at microdistribution, as our members are dealing with the challenges of serving customers in urban settings. With the rise of e-commerce, microdistribution is of great interest to a number of our members.
The study also looked at a number of workforce issues and the impact they are having on the supply chain as well as distribution.
Also new this year, we are making the study more engaging for our members by developing a tool that will allow them to go online, enter their data, and see how it compares with the [performance numbers] in the report. They will then be able to develop a number of reports that they can use and share with their teams. They can also compare facilities within their networks. The goal is to make the tool more usable, more useful, and more engaging for our members.
Generative AI (GenAI) is being deployed by 72% of supply chain organizations, but most are experiencing just middling results for productivity and ROI, according to a survey by Gartner, Inc.
That’s because productivity gains from the use of GenAI for individual, desk-based workers are not translating to greater team-level productivity. Additionally, the deployment of GenAI tools is increasing anxiety among many employees, providing a dampening effect on their productivity, Gartner found.
To solve those problems, chief supply chain officers (CSCOs) deploying GenAI need to shift from a sole focus on efficiency to a strategy that incorporates full organizational productivity. This strategy must better incorporate frontline workers, assuage growing employee anxieties from the use of GenAI tools, and focus on use-cases that promote creativity and innovation, rather than only on saving time.
"Early GenAI deployments within supply chain reveal a productivity paradox," Sam Berndt, Senior Director in Gartner’s Supply Chain practice, said in the report. "While its use has enhanced individual productivity for desk-based roles, these gains are not cascading through the rest of the function and are actually making the overall working environment worse for many employees. CSCOs need to retool their deployment strategies to address these negative outcomes.”
As part of the research, Gartner surveyed 265 global respondents in August 2024 to assess the impact of GenAI in supply chain organizations. In addition to the survey, Gartner conducted 75 qualitative interviews with supply chain leaders to gain deeper insights into the deployment and impact of GenAI on productivity, ROI, and employee experience, focusing on both desk-based and frontline workers.
Gartner’s data showed an increase in productivity from GenAI for desk-based workers, with GenAI tools saving 4.11 hours of time weekly for these employees. The time saved also correlated to increased output and higher quality work. However, these gains decreased when assessing team-level productivity. The amount of time saved declined to 1.5 hours per team member weekly, and there was no correlation to either improved output or higher quality of work.
Additional negative organizational impacts of GenAI deployments include:
Frontline workers have failed to make similar productivity gains as their desk-based counterparts, despite recording a similar amount of time savings from the use of GenAI tools.
Employees report higher levels of anxiety as they are exposed to a growing number of GenAI tools at work, with the average supply chain employee now utilizing 3.6 GenAI tools on average.
Higher anxiety among employees correlates to lower levels of overall productivity.
“In their pursuit of efficiency and time savings, CSCOs may be inadvertently creating a productivity ‘doom loop,’ whereby they continuously pilot new GenAI tools, increasing employee anxiety, which leads to lower levels of productivity,” said Berndt. “Rather than introducing even more GenAI tools into the work environment, CSCOs need to reexamine their overall strategy.”
According to Gartner, three ways to better boost organizational productivity through GenAI are: find creativity-based GenAI use cases to unlock benefits beyond mere time savings; train employees how to make use of the time they are saving from the use GenAI tools; and shift the focus from measuring automation to measuring innovation.
According to Arvato, it made the move in order to better serve the U.S. e-commerce sector, which has experienced high growth rates in recent years and is expected to grow year-on-year by 5% within the next five years.
The two acquisitions follow Arvato’s purchase three months ago of ATC Computer Transport & Logistics, an Irish firm that specializes in high-security transport and technical services in the data center industry. Following the latest deals, Arvato will have a total U.S. network of 16 warehouses with about seven million square feet of space.
Terms of the deal were not disclosed.
Carbel is a Florida-based 3PL with a strong focus on fashion and retail. It offers custom warehousing, distribution, storage, and transportation services, operating out of six facilities in the U.S., with a footprint of 1.6 million square feet of warehouse space in Florida (2), Pennsylvania (2), California, and New York.
Florida-based United Customs Services offers import and export solutions, specializing in remote location filing across the U.S., customs clearance, and trade compliance. CTPAT-certified since 2007, United Customs Services says it is known for simplifying global trade processes that help streamline operations for clients in international markets.
“With deep expertise in retail and apparel logistics services, Carbel and United Customs Services are the perfect partners to strengthen our ability to provide even more tailored solutions to our clients. Our combined knowledge and our joint commitment to excellence will drive our growth within the US and open new opportunities,” Arvato CEO Frank Schirrmeister said in a release.
And many of them will have a budget to do it, since 51% of supply chain professionals with existing innovation budgets saw an increase earmarked for 2025, suggesting an even greater emphasis on investing in new technologies to meet rising demand, Kenco said in its “2025 Supply Chain Innovation” survey.
One of the biggest targets for innovation spending will artificial intelligence, as supply chain leaders look to use AI to automate time-consuming tasks. The survey showed that 41% are making AI a key part of their innovation strategy, with a third already leveraging it for data visibility, 29% for quality control, and 26% for labor optimization.
Still, lingering concerns around how to effectively and securely implement AI are leading some companies to sidestep the technology altogether. More than a third – 35% – said they’re largely prevented from using AI because of company policy, leaving an opportunity to streamline operations on the table.
“Avoiding AI entirely is no longer an option. Implementing it strategically can give supply chain-focused companies a serious competitive advantage,” Kristi Montgomery, Vice President, Innovation, Research & Development at Kenco, said in a release. “Now’s the time for organizations to explore and experiment with the tech, especially for automating data-heavy operations such as demand planning, shipping, and receiving to optimize your operations and unlock true efficiency.”
Among the survey’s other top findings:
there was essentially three-way tie for which physical automation tools professionals are looking to adopt in the coming year: robotics (43%), sensors and automatic identification (40%), and 3D printing (40%).
professionals tend to select a proven developer for providing supply chain innovation, but many also pick start-ups. Forty-five percent said they work with a mix of new and established developers, compared to 39% who work with established technologies only.
there’s room to grow in partnering with 3PLs for innovation: only 13% said their 3PL identified a need for innovation, and just 8% partnered with a 3PL to bring a technology to life.
Volvo Autonomous Solutions will form a strategic partnership with autonomous driving technology and generative AI provider Waabi to jointly develop and deploy autonomous trucks, with testing scheduled to begin later this year.
The announcement came two weeks after autonomous truck developer Kodiak Robotics said it had become the first company in the industry to launch commercial driverless trucking operations. That milestone came as oil company Atlas Energy Solutions Inc. used two RoboTrucks—which are semi-trucks equipped with the Kodiak Driver self-driving system—to deliver 100 loads of fracking material on routes in the Permian Basin in West Texas and Eastern New Mexico.
Atlas now intends to scale up its RoboTruck deployment “considerably” over the course of 2025, with multiple RoboTruck deployments expected throughout the year. In support of that, Kodiak has established a 12-person office in Odessa, Texas, that is projected to grow to approximately 20 people by the end of Q1 2025.
Women are significantly underrepresented in the global transport sector workforce, comprising only 12% of transportation and storage workers worldwide as they face hurdles such as unfavorable workplace policies and significant gender gaps in operational, technical and leadership roles, a study from the World Bank Group shows.
This underrepresentation limits diverse perspectives in service design and decision-making, negatively affects businesses and undermines economic growth, according to the report, “Addressing Barriers to Women’s Participation in Transport.” The paper—which covers global trends and provides in-depth analysis of the women’s role in the transport sector in Europe and Central Asia (ECA) and Middle East and North Africa (MENA)—was prepared jointly by the World Bank Group, the Asian Development Bank (ADB), the German Agency for International Cooperation (GIZ), the European Investment Bank (EIB), and the International Transport Forum (ITF).
The slim proportion of women in the sector comes at a cost, since increasing female participation and leadership can drive innovation, enhance team performance, and improve service delivery for diverse users, while boosting GDP and addressing critical labor shortages, researchers said.
To drive solutions, the researchers today unveiled the Women in Transport (WiT) Network, which is designed to bring together transport stakeholders dedicated to empowering women across all facets and levels of the transport sector, and to serve as a forum for networking, recruitment, information exchange, training, and mentorship opportunities for women.
Initially, the WiT network will cover only the Europe and Central Asia and the Middle East and North Africa regions, but it is expected to gradually expand into a global initiative.
“When transport services are inclusive, economies thrive. Yet, as this joint report and our work at the EIB reveal, few transport companies fully leverage policies to better attract, retain and promote women,” Laura Piovesan, the European Investment Bank (EIB)’s Director General of the Projects Directorate, said in a release. “The Women in Transport Network enables us to unite efforts and scale impactful solutions - benefiting women, employers, communities and the climate.”