Surveyed omnichannel decision makers anticipate disruption led by drones, autonomous vehicles and crowdsourced delivery

Zebra Technologies Corporation has announced the results of its Future of Fulfillment Vision Study, a global body of research analyzing how manufacturers, transportation and logistics (T&L) firms, and retailers are preparing to meet the growing needs of the on-demand economy. In response to today’s online-buying, smartphone-wielding consumer that expects a seamless, faster purchasing journey, the study revealed that 78 percent of logistics companies expect to provide same-day delivery by 2023 and 40 percent anticipate delivery within a two-hour window by 2028. In addition, 87 percent of survey respondents expect to use crowdsourced delivery or a network of drivers that choose to complete a specific order by 2028.
 

• Only 39 percent of supply chain respondents reported operating at an omnichannel level. The survey found reducing backorders was the biggest challenge to reaching omnichannel fulfillment for one-third of respondents followed by inventory allocation and freight costs.
• 76 percent of surveyed retailers use store inventory to fill online

orders, and 86 percent of retail respondents plan to implement buy online/pick up in store in the next year. Retailers are investing in retrofitting stores to double as online fulfillment centers and shrinking selling space to accommodate e-commerce pickups and returns.

• Globally, 87 percent of respondents agreed that accepting and managing product returns is a challenge. The increase in free and fast product delivery corresponds with an increase in product returns, a costly concern that retailers struggle to manage efficiently across many different purchasing models. Seven in 10 surveyed executives agree that more retailers will turn stores into fulfillment centers that accommodate product returns. More than 60 percent of retailers that currently do not offer free shipping, free returns or same-day delivery plan to do so while 44 percent expect to outsource returns management to a third party.
• Although 72 percent of organizations utilize barcodes today, 55 percent of organizations are still using inefficient, manual pen-and-paper based processes to enable omnichannel logistics. By 2021, handheld mobile computers with barcode scanners will be used by 94 percent of respondents for omnichannel logistics. The upgrade from manual pen-and-paper spreadsheets to handheld computers with barcode scanners or tablets will improve omnichannel logistics by providing more real-time access to warehouse management systems.
• Radio-frequency identification (RFID) technology and inventory management platforms are expected to grow by 49 percent in the next few years. RFID-enabled software, hardware and tagging solutions, offer up-to-the-minute, item-level inventory lookup, heightening inventory accuracy and shopper satisfaction while reducing out of stocks, overstocks and replenishment errors.
• Future-oriented decision makers revealed that next generation supply chains will reflect connected, business-intelligence and automated solutions that will add newfound speed, precision and cost effectiveness to transportation and labor. Surveyed executives expect the most disruptive technologies to be drones (39 percent), driverless/autonomous vehicles (38 percent), wearable and mobile technology (37 percent) and robotics (37 percent).

 
REGIONAL FINDINGS

• The need for inventory accuracy will continue to rise in North America. Manufacturers, logistics companies and merchants ranked current inventory accuracy at 74 percent and reported needing to be at 83 percent to handle the rise of omnichannel logistics.
• Retailers in Europe and the Middle East are filling digital orders directly from their physical stores. Retailers and operations leaders are calculating that a network of stores can get digital orders faster and more efficiently than a handful of centralized warehouses. More than 80 percent use store inventory to fulfill orders and 29 percent expect this to increase by greater than 10 percent over the next five years.
• 95 percent of respondents in Asia Pacific rate e-commerce as the driving need for faster delivery. The region expects to implement same-day delivery faster than any other region, and 42 percent of those surveyed ranked drones as one of the most important disruptive technologies.
• Shipping fees and returns are undergoing a makeover in Latin America. Approximately 40 percent of respondents plan to discontinue free shipping, 55 percent expect to end free return shipping and 61 percent forecast the elimination of separate returns facilities that are managed by third-party companies.

 
Jim Hilton, Manufacturing and Transportation and Logistics Global Principal, Zebra Technologies “Driven by the always-connected, tech-savvy shopper, retailers, manufacturers and logistics companies are collaborating and swapping roles in uncharted ways to meet shoppers’ omnichannel product fulfillment and delivery expectations. Zebra’s Future of Fulfillment Vision Study found that 89 percent of survey respondents agreed that e-commerce is driving the need for faster delivery. In response, companies are turning to digital technology and analytics to bring heightened automation, merchandise visibility and business intelligence to the supply chain to compete in the on-demand consumer economy.”

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SURVEY BACKGROUND AND METHODOLOGY
Zebra’s Future of Fulfillment Vision Study surveyed more than 2,700 professionals in transportation and logistics, retail and manufacturing firms on their plans, implementation levels, experiences and attitudes toward omnichannel logistics. Surveys were conducted in conjunction with research partner Qualtrics in 2017 across the United States, Canada, Brazil, Mexico, Colombia, Chile, France, Germany, United Kingdom, Italy, Russia, Spain, China, India, Australia and New Zealand.

Only five percent of companies are considered truly “intelligent” enterprises, leveraging ties between physical and digital worlds for better visibility and actionable insights

Zebra Technologies Corporation has revealed the results of its inaugural “Intelligent Enterprise Index.” This global survey analyzes where companies are on the journey to becoming an Intelligent Enterprise; how they are connecting the physical and digital worlds to improve visibility, efficiencies and growth. Forty-eight percent are on the path to becoming intelligent enterprises, scoring between 50-75 points on the overall index. Only five percent exceeded 75 points on the index.

The Intelligent Enterprise Index measures to what extent companies today are meeting the criteria that define today’s Intelligent Enterprise. Some of the criteria include Internet of Things (IoT) vision and adoption plan as well as business engagement in developing a return on investment for IoT. The criteria were identified by leading executives, industry experts and policymakers across different industries at the 2016 Strategic Innovation Symposium: The Intelligent Enterprise, which was hosted by Zebra in collaboration with the Technology and Entrepreneurship Center at Harvard (TECH) last year.

The framework of an Intelligent Enterprise is based on technology solutions that integrate cloud computing, mobility, and the Internet of Things (IoT) to automatically “sense” information from enterprise assets. Operational data from these assets, including status, location, utilization, or preferences, is then “analyzed” to provide actionable insights, which can then be mobilized to the right person at the right time so they can be “acted” upon to drive better, more-timely decisions by users anywhere, at any time.

KEY SURVEY FINDINGS

• IoT vision is strong and investment set to increase. Forty-two percent of companies spend more than $1 million toward IoT annually, with an average of $3.1 million per year, and 75 percent expect that number to increase in the next one to two years. In fact, 42 percent of companies expect their IoT investment to increase by 11-20 percent. Notably, 57 percent of companies have an IoT vision and are currently executing their IoT plans. Although only 36 percent currently have company-wide deployment, it is expected that 62 percent will have it deployed company-wide in the future.
• Customer experience is driving IoT. Seventy percent of companies claim the largest driver of IoT investment is improving the customer experience. In the future, increasing revenue (53 percent) and expanding into new markets (51 percent) are expected to be the largest drivers.
• Business engagement is top of mind, but culture should be given more consideration. Seventy-seven percent of companies have a method in place to measure ROI from their IoT plan, and 71 percent have IoT plans that address both the cultural and process changes necessary to implement it.
• Many companies lack an adoption plan. More than 50 percent of companies expect resistance to adopt their IoT solution, yet don’t have a plan in place to address it. Only 21 percent who expect resistance, have a plan to address it.
• Companies keep employees informed, but there is room for more. Approximately 70 percent of companies share information from their IoT solutions with their employees more than once a day, of which more than two-thirds share in real or near-real time. However, only 32 percent provide actionable information to all employees, and information is provided either via email (69 percent) or as raw data (62 percent).

 
Tom Bianculli, Chief Technology Officer, Zebra Technologies quotes “An ‘Intelligent Enterprise’ is one that leverages ties between the physical and digital worlds to enhance visibility and mobilize actionable insights that create better customer experiences, drive operational efficiencies or enable new business models. This is a journey for enterprise organizations so we wanted to see where most companies are in the process. Clearly, many are still forming their IoT strategies, but we are seeing segments that have identified targeted use cases and are aggressively deploying solutions.”

SURVEY BACKGROUND AND METHODOLOGY

• The online survey was fielded from August 3-23, 2017 across a wide range of segments, including healthcare, manufacturing, retail and transportation and logistics.
• In total, 908 IT decision makers from nine countries were interviewed, including the U.S., U.K./Great Britain, France, Germany, Mexico, Brazil, China, India, and Australia/New Zealand.
• Eleven metrics were used to understand where companies are on the path to becoming an Intelligent Enterprise, including: IoT Vision, Business Engagement, Technology Solution Partner, Adoption Plan, Change Management Plan, Point of use Application, Security & Standards, Lifetime Plan, Architecture/Infrastructure, Data Plan and Intelligent Analysis.