Wayfair recently celebrated a significant milestone. I’ll give you a hint-it was featured in a roundup of the top 20 innovations from Wayfair’s first two decades of operation. The answer is Wayfair’s new homegrown warehouse management system (WMS), Nexus.
WMSes are one of the most vital yet unheralded elements of a great customer experience. When everything clicks, the systems chug along with little to no fanfare, which is how we like it. So back in 2017, when our previous third-party WMS system began showing cracks, the team took notice. Some of the deficiencies included:
- Unstable System: Manual testing was slow and error-prone, leading to increased software incidents. It also provided minimal visibility into the health and performance of systems, resulting in a long-tail of issues with higher triage-to-fix timelines.
- Suboptimal User Experience: The system featured an unintuitive interface and was confined to text. It was also plagued with repetitive menu navigation, which didn’t match the physical tasks being carried out by Wayfair associates. It made training a nightmare and resulted in significantly drawn-out workflows.
- Slow Development Process: The WMS lacked standard programming languages and patterns that slowed development velocity. This directly impacted developer retention and made it difficult, if not impossible, to find and hire engineers with relevant experience.
These cracks were exacerbated by our diverse set of product profiles and the multiple ways we leveraged our fulfillment centers. Both brought significant complexity that required new features and capabilities, which the system couldn’t accommodate. At least not in a timely fashion. In worst-case scenarios, teams would resort to “old school” paper processes—printing spreadsheets to guide associates on what work needed to be done.
Add it all up, and it was clear the WMS could not scale with Wayfair’s growth. What also became apparent is that another third-party solution was not the answer. This time we would take the road less traveled and do what we do best, create an in-house solution.
There are many strategic benefits that come with going the homegrown route. The first is flexibility. Specifically when it comes to the roadmap and meeting the needs of our fast-paced, ever-changing business strategies. Next, we could conduct user research to create and optimize a system that meets Wayfair’s specific business needs in the near and long term. And finally, a homegrown solution would provide better stability through improved team collaboration as well as superior data visibility and system integration.
The Journey Begins
Building a WMS is not something that can be done in short order. The effort takes time. In our case, four years, to be exact. Over this period, we would change the engines in midflight while adding new warehouses and capabilities for the business. If you’re wondering if that is unusual, the answer is yes, it’s highly unusual. In a typical scenario, companies will shut down their Fulfillment Centers for a period of time, a weekend or a whole week, for example, while someone comes in to install the new WMS.
To make it all work, the team created a rollout plan that would allow us to generate business value over a period of three years when both the old and new systems would be running. Our strategy was to replace the old system with a Parity+ mentality - make sure we could seamlessly switch between systems if needed, while making user experience improvements without blowing up the scope of the conversion. We broke down the work, prioritized and tackled tasks that added the highest business value first, defined the measurable outcome for each increment and balanced the perfect versus the pragmatic. We included our design, product, and operations partners from the start of every workflow, so we could solve some existing pain points while setting us up to make quick improvements in the future.
At the completion of each increment, we would put the new features and capabilities to the test by taking them live and then switching back to the old system as needed. The first increment was more of an engineering exercise focused on using our modern tools and languages to build a superior WMS. This occurred in 2018 and was a success. From that moment, the project took off. In 2019, the entire Wayfair Fulfillment Network team began contributing to Nexus.
Today, when using Nexus, many people first notice the mobile device. It bears little resemblance to the old RF devices, similar to the bulky mobile phones from the early 1980s with numerous buttons and a tiny text-only screen. If that wasn’t bad enough, this old device couldn’t be modified and was not able to provide the connection needed between physical and digital interactions.
Now those days are gone. The new devices feature a touch screen and our Android app that delivers a frictionless experience for associates to move through and between processes. This Android element also made it easy for us to add workflows remotely during COVID and observe how each workflow performed from anywhere. The team could even talk to an associate in the fulfillment center while watching what was happening on the screen of their device—we could be there without being there!
Nexus manages a series of 28 associate-facing workflows that support the various physical warehousing processes, including picking customer orders, tagging damaged inventory, receiving inventory, and many more, all of which can be managed using the mobile devices. We also implemented pallet level handling, automated performance alerts, and Directed Putaway while eliminating "on paper" outbound processes.
While we were replacing the user-facing software, we made some big strides on the full stack that impacted not only our team, but all of Wayfair. We were the first team to implement a mobile device management (MDM) solution at Wayfair, now all mobile devices and Windows laptops company-wide are tracked using the same MDM solution. We had the first separately deployable application in Wayfair, which paved the way for the rest of the engineering teams to deploy their applications independently, thousands of times per day. We also developed the first secure, industry-standard, token-based authentication mechanism for service-to-service communication at Wayfair which is now used by many other systems.
As for performance, Nexus faced its first major test in April when it supported 100 percent of Way Day, one of our biggest sales periods each year. At the end of March we turned off the old system’s servers, so there was no going back! We’re happy to report that it performed flawlessly through Way Day and in the time since then. Currently, Nexus supports our 18 Fulfillment Centers in 4 countries, with 8,000 unique users, 45 individual processes, and over the first half of 2022, handled 124 million scans.
We celebrated the achievement with our team in May, marking the end of a long journey. We were honored to have one of our founders, Steve Conine, join us for the occasion. Steve shared his thoughts on this long journey and praised the team for its work which included many firsts for the business. Even though we are fully using Nexus in our FCs, we still have a lot of work to do to keep up our growing fulfillment network and volume, but that work is going to be faster and easier with this new system.
How is that for setting the innovation bar?