Five Best Practices that Pave the Path to Supply Chain Orchestration

There has been incredible progress in supply chain digitalization over the last several years. Technologies that were considered novel just a few years ago are now common while a host of new solutions have been introduced. Here are just a few examples:

• Robot-assisted and goods-to-person picking technologies have largely displaced manual each picking.
• Truck unloading technologies are proving their value at multiple sites and are on a similar trajectory.
• Container unloading robots have been introduced to automate one of the most physically demanding tasks in many warehouses.  
• Supply chain IT systems have evolved to support improved productivity and visibility and are enabling greater use of analytics.
• Orchestration strategies are being deployed to dynamically balance resources across processes and improve response to unplanned events.

But progress has occurred on more than just the technology front. Companies like DHL Supply Chain have continually refined digitalization processes and strategies to enable accelerated deployment of a broad range of technologies and pave the path to orchestration. Here are five best practices that have emerged from the experience.

Best Practices for Supply Chain Digitalization

1. Take a structured approach
Creating meaningful advances in digitalization requires a disciplined and structured approach to technology selection and deployment.

DHL Supply Chain has developed a systematic approach to innovation that allows the company to stay informed of what is happening across the supply chain technology landscape, identify and vet the most promising vendors and technologies, and move those technologies from proof-of-concept to commercialization within the company’s network.

As technologies are moved from one stage of the process to the next, knowledge and processes are transferred from the digitalization team to the rest of the organization to ensure successful commercialization. Progress is also communicated throughout the organization to promote understanding of and support for, the company’s digitalization journey.

2. Know your vendors
Digitalization opportunities aren’t limited to vendors with roots in supply chain management. Sometimes the most exciting opportunities exist with companies that have great technology but limited supply chain experience.

That was the case when DHL Supply Chain engaged with Boston Dynamics. Both organizations had a common objective – automate the container unloading process – and complementary expertise. Boston Dynamics had the robotics expertise and DHL Supply Chain had the supply chain expertise. The collaborative development effort resulted in the Stretch™ robot.

The situation was different when DHL Supply Chain first engaged with Locus Robotics. Locus had the technology but needed a partner that could drive rapid deployment to achieve economies of scale and enable continued optimization. DHL Supply Chain became that partner and is now the largest user of Locus’ robot-assisted picking systems.

The supply chain technology landscape consists of a wide range of vendors with varying levels of maturity and supply chain expertise. Being able to utilize the most promising technologies requires understanding the capabilities and limitations of each vendor and adapting development and deployment processes to compensate for those limitations.

2. Innovate at scale
The goal of DHL Supply Chain’s accelerated digitalization initiative is to create a portfolio of digitalization technologies that address challenges across the supply chain and can be deployed routinely for new and existing customers.

To support this goal, the company develops playbooks for each new digitalization technology that document the process from proof-of-concept through each subsequent implementation. The playbook then becomes a valuable tool as support is transitioned from the digitalization team to operations and the solution becomes a standard part of the company’s offering.

4. Continue to optimize
The same approach that enables continuous improvement in supply chain operations should be applied to digitalization technologies. Don’t be satisfied with the initial level of performance a solution achieves, even if that performance meets expectations. Almost all digitalization technologies offer the opportunity for continued optimization that increases their value. This is now occurring not only at the process level but across processes as orchestration enables dynamic resource balancing and optimization.

5. Don’t be afraid to be first
Supply chain digitalization can create competitive advantages but only for those organizations that deploy technologies before their competitors. While there is increased risk in being an early adopter of emerging technologies, DHL Supply Chain has found those risks can be effectively managed through its structured innovation process and disciplined approach to proving the value and mitigating the risk of emerging technologies.

The company is now pioneering strategies to orchestrate people, technology and equipment within the warehouse and across the supply chain to eliminate bottlenecks, respond faster to changing requirements, and optimize resource utilization.  

Preparing for the Next Wave of Innovation

While significant progress has been made, there are still plenty of opportunities for supply chain digitalization to advance. Artificial intelligence, resource orchestration, mobile case handling, robotic item picking, and other technologies have the potential to deliver significant value to supply chain operations. The best practices developed during the first wave of digitalization will prove essential in tapping the potential of these technologies. For more information on accelerating supply chain digitalization, visit dhl.com/allin.

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