Majority of Companies will Redesign Warehouses in the Next 2 Years

June 20, 2008
Aberdeen Group study finds Best-in-Class companies have implemented warehouse management systems.

The next couple of years are going to be very busy for manufacturing companies as 97% of them are planning on redesigning their warehouses, according to a Aberdeen Group study entitled, "Agile Logistics: Transforming the Distribution Center."

In order to better align warehouse operations with overall business objectives as part of this redesign, 67% of those surveyed plan to start with improving warehouse processes, and 32% plan to upgrade or enhance their warehouse management software.

Best-in-Class performers have a centralized direction of processes within the warehouse. Over two-thirds of these companies maintain centralized control with commercial Warehouse Management Software (WMS). Aberdeen's research has continuously shown WMS solutions to be enablers of cost reduction and process improvement. However, despite the benefits and advantages delivered with a WMS implementation, 68% of companies still utilize paper or spreadsheets to manage their warehouses.

By 2009, Aberdeen expects over 50% of Best-in-Class companies to be using or have implemented additional warehouse technology such as Labor Management Software, Ruggedized Mobile Computers, Voice Technology, Yard and Dock Management and Slotting Optimization. The utilization of material handling equipment, including case or pallet handling Automated Storage and Automated Retrieval (AR/AS) is another top growth area over the next 24 months.

"Despite the economic slowdown, companies that are truly looking to create Best-in-Class distribution centers are taking advantage of the next wave of process and technology investments in order to create greater agility and reliability," said Bob Shecterle, SVP/Group Director - Research, Aberdeen. "The greater the agility, the greater the ability to react quickly and effectively to uncertainty. With technology and processes improvements, today's leading distribution centers are delivering greater value without increasing costs; the real difference maker."

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