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LMS Systems Provide Increasing Value
September 21, 2020
One of the most promising benefits of modern data science is the opportunity to reduce the setup costs of labor management software (LMS) systems, which will make them accessible to more operations than ever before.
Significant savings soon will be possible because a large part of an LMS setup is the development of engineered labor standards, which provide the benchmarks for each individual task in a DC. Historically, this process has been performed by a team of industrial engineers, which can be both costly and time-consuming.
Driving down LMS deployment costs
Soon, however, it will be possible to generate a significant portion of these standards automatically using regression models and other data science tools which draw on the deep experience of material handling and labor management experts. It’s estimated that this approach will reduce the initial investment cost of LMS systems by 40 percent or more.
Once such an LMS system is up and running, it will be able to handle ongoing adjustments to labor standards and other calculations, automatically balancing expectations to maintain peak performance without leaving workers feeling overwhelmed. Over time, the model also will learn to predict other factors, such as optimal pay rates for a given job and which incentives are generating the strongest returns on investment.
Ongoing cost benefits
This evolution of LMS systems will provide additional cost savings by relieving industrial engineers of back-end work, effectively giving them more time to invest in higher-value tasks, such as developing new process improvements. In many cases, it also will eliminate the need for DCs to hire additional staff in order to manage the system itself.
While some of the capabilities described herein are relatively new, they’re already delivering significant competitive advantages to forward-looking DCs in real-world field tests. And these are just a few of the ways next-generation LMS systems are enabling connected DCs to harness an unprecedented level of proactive control over their entire operations. Early signs suggest that savvy DC operators will use them to discover new opportunities for optimization, overcome the challenges of tight labor markets, and drive the development of autonomous systems.
To learn more, see the article “The Science of Labor and Productivity” in the latest issue of On The Move, our free digital periodical packed with insights to help unleash your DC’s full potential. You’ll discover how data is fueling the transition to predictability and profitability and learn how its impacts are already being felt in nearly every aspect of DC operations.
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