We have nearly all moved very quickly to an acceptance of shopping on-line and all have gained an understanding of what advantages we are looking for over previous models of shopping.
e-fulfilment, which started from small beginnings, has now developed along a path that everybody is familiar with and brought together various other technological developments. These include secure ordering, order tracking and electronic payments for the customer and paperless picking, delivery scheduling and consignment tracking for the supplier.
Initially these were brought together within conventional warehouses, but it was soon realised that beyond a low level of activity, specialised e-fulfilment could be optimised by using specially designed facilities.
The principles behind e-fulfilment have now been continually developed for nearly 20 years and so what makes a operation good can now begin to be recognised.
The essential requirements that drive the optimisation of the facilities and systems are defined by the consignment size and delivery time expected. Companies offering single CDs to consumers will have essentially different facilities to those offering pallets of building materials on a business-to-business basis or even those supplying household goods for home delivery. In each case, however the typical order size and service level offered will have contributed to the design of the facilities and systems.
Suppliers of a wide range of products have recognised the need to separate warehouses and delivery methods for items that can be carried by one man and for those that require two men such as furniture. For smaller items there is also a range of automation strategies available. For all these differing answers to the fulfilment question there is clearly no one solution that makes the operation “good”.
However, what they all share is a system that drives the operation and manages the interface between suppliers and customers. Customers now expect that data entry (the customer ordering process) must be slick and they now expecting a high standard of web site design and interface, some of the clunky systems of the past will just not do nowadays or customers will go elsewhere.
The other customer interface is at delivery and again customers appreciate certainty and reliability. Information flow is again the key.
So a good e-fulfilment warehouse operation can be good for customers and it can be good for the operator in different ways, but in either case it is unlikely to be good enough in the medium to long term as it certain that new demands and cost requirements will make it imperative to continue to improve.
A major impact on a good e-fulfilment operation on the future, perhaps currently one which has been optimised for both operator and customer for a particular set of circumstances, is that the definition and expectations of e-fulfilment are constantly changing and broadening.
Watch out for the changes required for m-commerce, the multi-channel extension of e-fulfilment and the conflicting demands that can place on the organisation! Companies will need to re-visit the layouts and operation of their physical systems and make sure that their IT systems can cope with the new demands.