Supply chain efficiency is often the key to success for retail organisations. Despite being an important part of the supply chain, distribution centres are often neglected by retailers. Retailers have not yet gone the extra mile to bring in efficiency of DCs. An easy way to go about doing this is through IT automation. Shoppers Stop, one of the leading retail chains in India, has been quite aggressive in the use of technology till date, and has recently deployed a distribution centre management system as another milestone in its IT journey.

Manual Process Led to Inefficiencies

Shoppers Stop has set up large distribution centres spread over lakhs of square feet area in prominent regions of east, west, north and south India. The company recently merged its two DCs in Mumbai into one mega-scale DC at Bhivandi. The earlier process followed at warehouses was completely manual and hence, was time consuming and prone to errors. As and when the requirements were raised by stores, the DCs used to receive a pick-list of merchandise. This pick-list was then issued to pickers, who had to manually check the racks for finding an item of a particular style, size and colour. Many a times, the picker would get a wrong item. In this set-up, the global quantities used to match, but the customers were not getting what they wanted. To keep check on this, Shoppers Stop also had another team verifying the stock picked by the picker. All this used to delay the turnaround time.

The company had rolled out a warehouse management system in 1998, which was part of the JDA MMS merchandise management system. "That served its purpose quite admirably for some period of time, however, as our scale of operations increased, we felt the need for further automation of our processes related to the warehouse," says Ranjit Satyanath, customer care associate and general manager, Solutions & Technology, Shoppers Stop.

Besides, the retail giant had outsourced its warehouse operations to 3PL (third-party logistics) vendors. It was a tough task to ensure that the vendors were following the guidelines set for them with respect to day-to-day operations. Also, while the picking activity happened in warehouses, there was limited visibility for DC managers and the central supply chain management team as to the status of the various tasks being conducted at various corners of the DC. There was a lack of real-time information, in case the need arose to come up with a solution if any problems arose at any DC.

Automating DC Management

To address the above-mentioned challenges, Shoppers Stop decided to implement a distribution centre management system or DCMS, which involved integration of various technological components. The DC workforce now logs in to the central server over the wireless network using hand-held computers, and downloads tasks, which have been assigned to them. As and when a particular task is completed, a report is submitted on the mobile computer, which gets automatically updated on the central server and their MMS over the network.

DC managers based at different locations can now log on to the DCMS using a Web interface, which provides the basic workbench for managing all DC activities for the day. This granular view across all DCs is also available to the central supply chain team and members are able to react on a real-time basis. "When we decided to develop this application, we were clear that the cost had to be low and hence, we built the entire architecture using open source technologies," says Satyanath.

The entire software was developed by Mobicule Technologies, a player in the enterprise mobility space.

Challenges during Implementation

DCMS as a project spanned the entire spectrum of the user group from un-educated, blue-collared workers to the domain experts within the supply chain team. It faced more than its share of challenges during implementation, which involved change management, acceptance of highly-sophisticated technology and training of unskilled workforce.

Technological Challenges

The DCMS database resides in a central IDC. This data needs to be accessible across India at all DCs. This meant that data from the IDC had to be available to all the individual mobile computers spread over the various corners of a DC, where wireless coverage could be weak at times. The DCMS needs to enable operations in the DC even at times when the base ERP may be inaccessible due to regular maintenance activity.

Benefits from the Project

The time taken for all processes reduced drastically at various stages. The errors reduced to nearly nil as all items picked are now validated by a scanner, which emits an error beep if the wrong item is scanned. DC managers now have a single screen view of what is the status across the entire workforce and at what stage of transaction they are currently in. The central supply chain team also has a detailed view of what is happening at each DC enabling better control over the whole process. The end result of this automation is that the stores are better stocked, offering the right product at the right time.

At the global level, the accuracy of dispatches to the store is now almost 100 percent while stock outs have been reduced by 17 percent. Overall, employee productivity has improved at every level.

Technical Details

Hardware details

• Server hardware – VMware virtualised server using Dell Poweredge 2950, 2 GB RAM, 3 ghz processor, 70 GB HDD.
• Wireless communication using Cisco thin solution network, which is centrally managed.
• Motorola Symbol MC3090 handheld mobile computer with scanner.

Software Details

• RHE Linux 4
• Development environment – JDK 6
• Database used – MYSQL 5
• JBoss App Server 4.0.2
• Symbol MC3090 OS – Windows CE 5.0
• Scanner application – Mobicule’s Warehouse Automation deployed on Java 1.3 crème 4.12