Before we talk about warehouse automation, let’s try to understand what value does automation bring to the table. Automation is all about identifying repetitive tasks which a consume significant amount of time and / or lead to common errors. Once these tasks in your processes have been defined, you can start thinking about automating them.
Now let’s consider your warehouse.
An Operator walks to a bin and picks one unit of an SKU. Another operator then walks to the same bin to perform the same function for a different order. The Operators then categorizes the inventory, sorts it and make it ready to be dispatched. Finally, you end up updating the tracking system multiple times. In reality, the scale of this process is much larger and happens over and over again. This duplicity and repetition of tasks presents an opportunity for automation.
By automating your warehouse, you can improve efficiency, increase the speed of operations, make the processes more reliable, improve accuracy while ensuring that your system is flexible and scalable.
Today, more than ever, warehouses and distribution centers seek flexible automation, for example, Goods-to-Person (GTP) technology. The concept of GTP is easy to understand. In manual operations, operator travels to the bin to pick the good. In GTP, goods are brought to the operator. This significantly improves the throughput of your warehouse and improves service levels, while reducing the overall cost per shipment. To add to this, stores today expect their deliveries to be packed and sequenced in a way that minimizes their time and manpower requirement for storage operations at store level. If you’re able to do something at your distribution center which enables shelf replenishment in the right sequence, your manpower requirement in the store goes down considerably, So if you’re a retailer with hundreds of stores in the country, this is a major impact.
At the same time, accuracy is of paramount importance. For example, you are shipping out 20,000 cartons in a day with 97% accuracy. The cost of re-handling 600 cartons per day is very high. Repercussions include dropping service levels, top reverse logistics cost, increased processing & related manpower requirement and sales opportunity loss.
Today, we speak data. Companies are looking at block chain. You’re hiring data scientists, data mining experts who deal with big data. But where are you getting your data from? Is the source manual and reliable? Automation technology is acutely capable of not only sharing multiverse of data with you but also translate data into relevant information, evaluation metrics, performance scorecards which are tailor-made to your KPIs. While automation is at it, it also ensures very high accuracy.
This all sounds rosy. But what are the advantages of warehouse automation?
Reduced operational costs: Automation lowers both direct costs and indirect costs. For example, a reduction in direct costs can be attributed to a decrease in manpower. Indirect costs can be attributed to recruitment, training and administration costs for manpower
Safer operations: Robotics replaces humans in dangerous tasks. You can eliminate workforce from back-breaking, injury prone tasks. At the same time, human exposure to hazardous machinery is limited
Improved productivity: Automation works 24 x 7, 365 days. It does not seek lunch breaks, Christmas holidays and doesn’t scowl if you want to run it for an extra shift. Also, you can define the throughputs you wish to achieve from your warehouse or distribution center. There can be a limit to the manpower deployed in particular floor space, but such limitations do not exist with automation
Consistent performance: Automation ensures that your standard operating procedures are followed every time, allowing a work to be done each andevery time identically. Hence, you can be assured of consistent quality, consistent performance and high accuracy
Consistent performance will lead to a better forecast for your production needs. This will let you lower inventory levels, hold appropriate work-in-progress inventory and reduce capital costs
Flexibility: Consumer demands can change overnight. A viral story on social media can either bolster or drop the demand of the product literally overnight. It is next to impossible to hire, train and sign a contract with labor to fulfill this surge in requirement, nor can you lay-off manpower immediately. Hence, flexibility plays an extremely vital role in re-tasking and adapting to changes on the fly, ensuring continuous and consistent performance and productivity
Barring the fact that warehouse automation is cool to have and will give you a level-up for disruptively changing your warehouse operations, we can clearly see that warehouse automation has a host of business benefits and advantages. At the same time, it is imperative for you to ask a few questions before you choose if you should or should not go for warehouse automation.
Some of them will shall be:
Can my current processes sustain planned YoY growth?
- With scale, will I outgrow my existing warehouse space? Can automation help me increase productivity in the same area?
- Am I able to manage and control my inventory down to unit level?
- How are my customer service levels? Will automation improve my service levels to give me a competitive edge?
- What is my return on investment? Will automation help me sell more, sell faster and sell accurately?
- And finally, is this technology modular and scalable?
Once answers for these and a host of other questions are known, I am sure you will be able to identify your warehouse automation needs. Like any technology, warehouse automation is moving from ‘good-to-have’ to ‘must-have’. So, the time to gain an edge over your competitors, is today.
I sincerely hope that this article acts as food for thought and helps us explore more about how automation can disruptively and not incrementally improve the lives of your employees, the happiness & experience of your customers and increase profitability.