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Technology Drives the Value of 3PL Partnerships

By Joe Puleo, Chief Customer Officer, DHL Supply Chain, North America

Joe Puleo, Chief Customer Officer, DHL Supply Chain, North America

Just as technology continues to drive the global economy, technology is changing the way 3PLs serve customers in a wide variety of industries. While there is no off-the-shelf and one-size-fits-all technology solution when applied to specific needs beyond basic warehouse management, established and emerging technology is enhancing the value of partnering with 3PLs.

The challenge many organizations face today regarding technology is the wide variety of techniques that are available and the speed with which those technologies are advancing. From robotics to augmented reality to IoT and data analytics, supply chain managers are faced with a plethora of emerging technologies, all of which are hyped as being transformational.

Few organizations have the time, resources and expertise to evaluate all the options available to them. But neither can they afford to ignore what’s happening.

A leading 3PL, on the other hand, has the scale and expertise to stay on the forefront of emerging technologies. At DHL Supply Chain, for example, we’ve made the investments in people and platforms to help our customers integrate warehouse management systems more efficiently and capture and use data across the supply chain more effectively. At the same time, we’re working with a diverse group of technology companies to pilot emerging technologies and identify those that best fit our customers’ needs. Moreover, customers get the benefits of supply chain solutions that enable visibility and productivity without distracting from their core business or making significant capital investments.

Digital technology

In a recent DHL Supply Chain survey, more than 80 percent of participating companies said that digitalization is having a moderate to high impact on their business today and 73 percent considered big data analytics to be the most significant information technology for their supply chain.

However, while these organizations know they are generating valuable data across the supply chain, many are unable to collect and use that data to improve operations. A 3PL can be a valuable partner in enabling this through supply chain management and business intelligence platforms that provide full supply chain visibility, accessible anytime and anywhere via computers or mobile devices. The focused expertise and breadth of experience of a 3PL can also enable more effective use of data through analytics services.

The next phase in this development will be the use of artificial intelligence that uses this data to optimize services such as transportation management. Again, 3PLs are well positioned to lead the integration of artificial intelligence into the digital platforms available today.

3PLs are also using digital technologies to address the labor challenges that are crippling some supply chain organizations. From online applications to streamlined onboarding processes to mobile apps that provide workers with greater scheduling flexibility, digital technologies are an essential component in the robust labor management strategies 3PLs employ to ensure human resources are always available to meet customer needs.

Physical technology

Most respondents in the survey mentioned above agreed that leveraging 3PL expertise applying physical technology is preferable to going it alone, in part due to the rapidly changing nature of supply chain technology.

This is particularly true of robotics, which we expect to have a significant impact on the supply chain this year. A 3PL is better able to make investments in robotics because they have the resources to pilot multiple solutions, the flexibility to leverage chosen solutions across an extensive network and the scale to help ensure the long-term viability of select equipment providers.

Robotics applications can be flexible and scalable within a facility, providing efficiency and cost advantages that may deliver exponential benefits, especially in today’s economy in which the competition for competent, skilled warehouse personnel becomes greater by the day.

Additional advantages can be realized in that robotic-assisted picking can relieve the physical stress of human workers by automating low-value tasks or travel.

One simple robotic solution is collaborative automated order picking. This approach utilizes an automated cart, or several such carts, that follow a human order picker who controls them as items are loaded.

Once the specific order for the cart (or carts) is filled, the cart is sent to the packing station as another cart arrives for the worker to begin filling another order. This streamlines the picking process, as the worker does not have to stop and advance the cart with each pick, and eliminates the low-value travel time associated with getting orders to packing.

Robotic carts can also be integrated with the WMS and lead the picker from location to location, instructing the picker on what to pick at each location. Again, when the cart (or carts) are filled, they are sent to the packing station as another cart arrives to lead the picker on to the next order fulfillment task. Another approach DHL Supply Chain has piloted is using swarms of robots to serve pickers who are stationed within defined zones in the warehouse.

Forward-thinking 3PLs are not only using robotics today but are also thinking beyond robotics. One promising technology is augmented reality (AR). Heads-up displays enabled by AR are being tested as pick-assist devices in a multi-modal solution, replacing paper or RF scanning.

The shortest path to supply chain digitalization

Between digital information technology systems and physical robotic and AR systems, technology is quickly transforming the way supply chains are managed. For most organizations, partnering with a 3PL is the most effective approach to realizing the full benefits of emerging technologies with minimal risk. 3PLs that are at the forefront of digitalization can optimize costs, improve service levels and increase agility.

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