DHL’s IDEA to make warehouse processes more effective

August 13, 2020: DHL Supply Chain is aiming to optimise e-fulfilment for online shops with IDEA, a solution specifically designed for warehouses.

IDEA algorithm can significantly improve order-picking processes in DHL-operated warehouses. The costs involved are comparatively low since the software, developed by DHL, is compatible with most traditional warehouse management systems and can be integrated easily into existing IT infrastructure. In its first commercial deployments, the solution has reduced distance travelled by warehouse employees by up to 50 percent and increased productivity of individual DHL locations by up to 30 percent.

"The Covid crisis has shown us that unforeseen volume fluctuations for individual products can put enormous stress on supply chains. Lack of clarity regarding stock levels and incorrect data on availability can lead to bottlenecks for individual products and then delays in delivering to end customers," said Markus Voss, CIO & COO at DHL Supply Chain. “We are working with our customers – large online stores and retail companies – on more stress-resilient, reliable algorithms and tools to better anticipate demand fluctuations, optimise the allocation of manpower and thereby accelerate the throughput of goods and order cycles.”

The Covid crisis has resulted in steadily growing online sales. Especially online orders of everyday staples, such as food, medicines and other drugstore products, are higher today than before the pandemic. The trend poses challenges for retailers worldwide. In many cases, orders have increased, but the size of shipments is smaller. New and more diversified product ranges means more stock keeping units for online retailers.

To meet challenging e-commerce needs, especially during Covid-19, DHL Supply Chain is increasingly relying on intelligent, IT-based forecasting and analysis tools to optimise warehousing and processing of online orders for major e-sellers.

"Our IDEA analysis tool is one of our many answers to these e-commerce challenges," said Dietmar Steins, EVP solutions design at DHL Supply Chain. "With its algorithm, this ‘artificial intelligence’ solution helps optimize picking routes within the warehouse. Orders are also clustered logically, which helps optimise picking by our colleagues in the warehouses. The integrated, intelligent task planning can also optimise workload distribution for warehouse staff and help prioritize more time-critical shipments. Moreover, IDEA reduces error rates as well as the time required for employee training.”