Warehouse inventory is essentially like cash or gold bars, highly valuable and highly vulnerable to misappropriation. Protecting inventory requires a multi-dimensional approach, says Steve Mallaby, CEO of Cquential, a developer of software solutions for warehouse and supply chain management, because the stock is vulnerable to those who work inside.
“Securing warehouses against physical break-ins is obviously critical, but the truth is that it’s the elements within who are the most dangerous and difficult to detect,” says Mallaby. “Cquential believes that the right combination of software (technology), people and process is the only way to protect inventory.”
Mallaby says that the first step is a warehouse management system that builds best practice into the way it works. For example, Cquential enforces blind picking of orders inside the warehouse, followed by blind checking of orders by a separate individual. The system also monitors picker performance to improve efficiencies in the warehouse and reduce idle time. If the picker cannot find the item in the designated location, the system will direct him or her to an alternative location and raise a query.
This rigour has to be matched by a complementary rigour in the supporting business processes. Thus, while the warehouse management system will be able to show how many stock items should be in a certain location, it will still be necessary to verify this physically. The advantage, though, is that the system identifies discrepancies as they occur, without waiting for quarterly stock-takes.
Mallaby says that this combination of software and business process has enabled Cquential to reduce shrinkage on a stock holding of around R600 million to a miniscule R3000 for one of its large pharmaceutical customers because the best practices built into the software are replicated in the company’s business practices.
“This ability to identify each stock item or batch of items and to link it to specific pickers and checkers, and specific orders, goes beyond security. It also means that in the event of a recall, specific items can be traced back through the supply chain easily and quickly,” he notes.
It thus follows that another critical aspect of warehouse security involves the security of the warehouse management system. Mallaby says that as the Cquential Software is delivered as a service to clients, great care has been taken to secure the hosting environment. Cquential uses a secure hosted private cloud environment in which access is only possible via the application, it’s not possible to access the warehouse management via other systems. The data centre is based in South Africa, thus ensuring data sovereignty in respect of the Protection of Personal Information Act.
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