Question

On the Move toward Digital Transformation: Honeywell Integrated
E-commerce pressures are driving retailers, wholesalers and third-party logistics providers to accelerate their evolution to more digital, automated business operations and fulfilment processes. Throughout our industry, technologies like robotics, automation, data analytics, machine learning and artificial intelligence are no longer part of some faraway future, but the very tools companies are starting to integrate into their daily business practices. Not only is this evolution helping these companies deliver consistently exceptional customer experiences, it’s also introducing solutions to traditional challenges while ushering in a new era of process efficiencies. Today’s distribution and fulfilment operators face a perfect storm of market challenges:

 Service level expectations: Consumers want faster, cheaper shipping and accurate, on-time deliveries of an ever-expanding variety of products, and these rising service level agreements dictate order fulfilment process improvements. Pure-play e-tailers and omnichannel retailers alike are faced with escalating speeds, volumes and complexities in their DCs.

 Labor challenges: At the same time, rising labor costs and workforce shortages are shared hurdles faced by most, if not all, DC operations. Labor accounts for up to 70 percent of DC operational budgets, while industry growth is outpacing the labor pool by a ratio of six to one.

 The uptime imperative: Limiting unplanned downtime is critical to running profitable operations. Every hour of downtime results in idle workers, potential overtime costs, shipping and logistics delays, and a variety of ripple effects that can ultimately chip away at profits and service level agreements. It all quickly adds up: as much as $10,000 for an hour of downtime, and much more for extended durations.

For these reasons, “digital transformation” has become a stated business objective for most online retailers. It is necessary for ensuring survival in this ultracompetitive climate and essential for growing a loyal customer base.

But the rate of progress in this transformation is as diverse as the spectrum of fulfilment operations. No two are alike, and the drivers, goals and extent of this transformation are as varied as the number of SKUs found in a typical e-commerce DC inventory. Regardless of where you sit on this continuum, you’re probably seeking guidance on how to take the next steps on your journey.

Question 1

Critically discuss the reason why Honeywell Integrated has decided to make a move toward Digital Transformation and examine the types of technologies currently used in the company

Question 2

In the context of Honeywell integrated, recommend alternative electronic procurement methods that can be used to deal with market challenges faced by distribution and fulfilment operators

Answer 1

Question 1

Honeywell Integrated has decide to move towards digital transformation because of the following reasons :

1.  Service level expectations: Consumers want faster, cheaper shipping and accurate, on-time deliveries of an ever-expanding variety of products, and these rising service level agreements dictate order fulfilment process improvements. Pure-play e-tailers and omnichannel retailers alike are faced with escalating speeds, volumes and complexities in their DCs.

2. Labor challenges: At the same time, rising labor costs and workforce shortages are shared hurdles faced by most, if not all, DC operations. Labor accounts for up to 70 percent of DC operational budgets, while industry growth is outpacing the labor pool by a ratio of six to one.

3. The uptime imperative: Limiting unplanned downtime is critical to running profitable operations. Every hour of downtime results in idle workers, potential overtime costs, shipping and logistics delays, and a variety of ripple effects that can ultimately chip away at profits and service level agreements. It all quickly adds up: as much as $10,000 for an hour of downtime, and much more for extended durations.

Honeywell integrated is currently using a traditional method for the maintaining the supply chain and customer relationships, which in turn is costing the company a lot as the customer wants faster, accurate and on time deliveries which is very difficult to maintain with the traditional system used.

Question 2

At first the company needs to integrate all the activities into a single pltform which would be benefical for both parties in terms of costs and implementation. The company needs to install a robust ERP software for the accounting of data e.g SAP, and do a staffing of trained employyes in the same. They should use the newly hired resource to train the employees and also perform a training and development of the software among all the levels of the department. This will help them to reduce the time for delivery and will also help in integrating their activities into daily business practices