There are many things that determine the efficiency of a business. However, when that business involves the production of a tangible product, there is probably nothing more important to efficiency than the quality of warehouse management.
In recent years there has been a revolution that is changing warehouse management forever. That revolution is big data. Big data is the collection and analysis of a volume of digital information so vast that it couldnt be stored on computer hardware until recently. It has transformed business analytics and been a game changer in many different industries. Here are some of the ways big data is changing warehouse management in the modern era.
Big Data Improves Operational Efficiency
Operational efficiency can be described as the ability of a business to deliver its product or service to consumers in a way that minimizes cost while maximizing the quality of that product or service as well as other related support services. Operational efficiency is certainly something that can be improved by the integration of big data analysis. Data regarding operations in a warehouse, or any facility for that matter, can be immediately updated in real time.
This can have some real benefits. A warehouse manager can be given a minute to minute or even second to second overview of operations in the warehouse on a computer or mobile device. That manager will be able to spot bottlenecks in workflow as they develop and be able to take immediate steps to resolve them.
With advanced software, removing such bottlenecks can even be automated, enhancing efficiency even more. According to IBM, trillions of sensors have been integrated into big data systems for the purpose of tracking business processes. These sensors immediately record the information and make it available for on the spot analysis.
It Can Maximize Revenue and Profit
Warehouse efficiency is often directly tied to the profit a company produces. When a company produces overstock that is stored in the warehouse, costs go up and profit is decreased. The same happens when not enough stock is stored to meet demand. Revenue from would-be customers will be lost to competitors. According to RetailWire, retailers lost a whopping $1.1 trillion in revenue due to products being out to stock or overstocked.
However, if a sweet spot can be found where only enough stock is stored as needed to meet demand perfectly, both revenue and profit can be maximized. Big data can make this a reality. With more information to reference, more accurate forecasts for demand for products can be created and integrated directly into inventory management procedures. The software used will also be able to detect shortages days or even weeks before they occur. This can insure that shortages in stock and the creation of overstock are far less likely to occur. Both profit and revenue will be maximized.
Software Integrated Dimensioning
Items that enter or leave the warehouse need to be scanned and weighed to collect the appropriate data so they can be stored in the warehouse or shipped out to distributors or customers properly. Part of this process is known as dimensioning. This captures the dimensions of a package.
These days, dimensioning systems make good use of cloud computing and software that leverages big data. A package that is scanned by such a system can have all the information regarding its product ID, weight and dimensions recorded and instantly stored in a database. This information can later be accessed and used as needed to increase the efficiency and accuracy of warehouse management on an item to item basis.
According to Gartner, 75 percent of businesses have invested or are planning to invest in big data to improve their business processes. One business process that can certainly be greatly improved by the integration of big data analytics is warehouse management. Investigate different ways big data can improve the efficiency and effectiveness of your inventory management systems.
