New Research Highlights Key Challenges in Warehouse Operations
Manhattan Associates Inc. (NASDAQ: MANH) as released its 2024 'State of Warehouse Operations' research, conducted in partnership with Vanson Bourne, highlighting critical issues that Australian businesses must address to stay competitive. Amid economic and geopolitical disruptions, local procurement and supply chain leaders are under increased pressure to manage staff retention challenges, modernise outdated technology, and streamline complex multi-channel operations.
The study found that 93% of Australian warehouse professionals are facing ongoing difficulties with staff retention, a challenge that threatens operational stability. Compounding this issue, 79% of respondents reported a significant surge in goods passing through their warehouses over the last year. As warehouses become busier, nearly all respondents (98%) believe their current IT infrastructure is insufficient and urgently needs modernisation to manage these growing volumes effectively.
Global disruptions, combined with changing consumer expectations, are reshaping the supply chain landscape. Warehouse professionals must navigate labour shortages, supply chain disruptions, and increasing demand across both digital and physical sales channels. According to the research, senior management from industries including manufacturing, logistics, pharmaceuticals, retail, automotive, and consumer packaged goods (CPG) pinpointed outdated technology, workforce shortages, and multi-channel order complexity as their biggest operational hurdles.
Optimism Through Emerging Technologies
Despite these challenges, Australian businesses remain optimistic about the potential for emerging technologies to improve warehouse operations. The research revealed that 68% of respondents believe Generative AI will significantly improve job satisfaction and productivity by automating manual tasks, while 72% expect robotics to enhance operational efficiency by reducing bottlenecks in workflow processes.
Raghav Sibal, Managing Director for Australia and New Zealand at Manhattan Associates emphasised the importance of embracing new technologies: “High turnover and low morale disrupt operations, drive up costs, and damage service quality. Addressing these issues with advanced technologies like AI and robotics will not only help businesses meet rising demand but also support staff engagement and satisfaction.”
Technology Gaps Pose Operational Risks
The study also highlighted that 28% of businesses see outdated IT systems as their most pressing challenge, with financial and operational inefficiencies resulting from reliance on legacy technology. These inefficiencies are especially concerning in a landscape where 22% of respondents struggle to manage orders across multiple channels, and 20% find it difficult to meet growing consumer expectations for faster delivery times.
“Warehouses are the backbone of a unified supply chain. Optimising operations with modern technology is vital for businesses to stay competitive,” said Sibal. “By adopting innovations like microservices and Generative AI, businesses can future-proof their supply chains, turning them into key drivers of revenue growth and customer satisfaction.”
The Future of Warehousing
The report highlights the growing importance of continuous innovation in supply chain operations. As businesses adapt to rising demand and rapid technological advancements, a cohesive strategy that integrates advanced technologies will not only boost efficiency but also promote economic and environmental sustainability.
“A unified supply chain strategy enables businesses to improve productivity and efficiency while supporting sustainability efforts. By integrating advanced technologies, businesses can boost their profit margins and contribute positively to the planet,” Sibal concluded.
