Early movers on automation react better to crisis

Warehouses are extremely busy places at the best of times, with often hundreds of people on a shift managing inbound, put away, store picking, store outbound, online fulfilment and returns. Covid-19 has meant that extraordinary measures had to be put in place to ensure social distancing requirements are met and employee wellbeing is protected throughout their operations.

Those warehouses that have invested heavily in automation are less impacted by labour availability so they can respond more effectively during the crisis, but the resulting shutdown on the high street, has seen a demand shift very quickly to online for some retailers. We have all seen how Next shutdown their operations for two weeks to develop a new approach to how their warehouse and fulfilment operation will work.

This switch to online typically drives higher numbers of smaller orders each requiring packaging and delivery in a short time window without increasing the costs to the customer, and provides warehouse operations with a seemingly impossible conundrum.

Offering this level of service, without changing the processes and performance, will inevitably lead to increasing the cost to serve and impacting company profits, at a time when they’re already being hugely impacted by the shutdown of high street shops. Warehouse operations must therefore strive to increase efficiency against a background of reduced staffing levels because of the social distancing/isolation measures now in place. 

Before the crisis

Before the crisis, the focus in operations has been increasingly on reducing non-productive time (in this context i.e. time not spent performing the task) and eliminating non-value added tasks, (i.e. tasks that do not increase the value of the product or service). These are not so much new initiatives rather a renewed focus.

Typically, much of the time in a manual operation time is spent moving between tasks, e.g. picking in a warehouse. In a typical example of an Ecommerce operation, a manual picker, walking a shelf system could spend 60% to 70% of the time walking to and from the area and between the pick locations. Some retailers have automated this operation of bringing the goods to the operator, with ‘Goods to man systems’ – which removes the pick walk and improves pick rate by a factor of ~2.5. Naturally those retailers using these systems would have found it easier to adapt there picking operations over the last few weeks, as they’ve not needed to consider how social distancing will impact this activity.

At the same time, those retailers that have invested heavily in automated storage and retrieval systems will also be better positioned as these systems typically provide dense storage, and the development of shuttles (both carton and more recently pallet shuttles) have also increased throughputs significantly. When coupled to conveyors and workstations these systems are finding favour in many Retail and Ecomm operations. 

AGVS and AMRs

Automated Guided vehicles (AGVs) or Mobile Robots are not a new technology, but they can now offer transportation from one place to another with flexible routing. Those retailers at the front end of investments in AGVs have shown a growing interest in transport and workplace assistance with their new range of lightweight free path AGVs. A number of variants already exist for warehouse operations. Examples include:

• A tow tractor or lift table can be used to take trolleys to and from the pick area, avoiding the need for fixed conveyors. 

• AGVs, configured as trolleys, can link Pickers in adjacent zones, taking part completed orders from one to another, eliminating the walking between areas.

• Developments in navigation systems and AI now allow the AGVs to sense obstacles and react accordingly, e.g. stop, move aside or reroute.

While single item picking robots have been available for some time the problem of placing the picked items into the receiving container often meant the robot dropped the item, creating an unsightly pile and potentially damaging more sensitive products. Collaborative Robot applications share workspace with operators who could intervene and rearrange misplaced product. Applications in close proximity to operators also meant robot arm speeds were limited to ensure man and machine could work safely together. 

Advances in sensors and vision systems permit the pick and place robot to ‘see’ where the items are and to position them precisely, (e.g. place, stack or nest), taking account of items that may have fallen over or otherwise may have moved in the receiving box.

Such technology reduces the need for a shared workplace, an important requirement at this time, and the robot speeds can be increased accordingly. Resultant pick rates are now advancing towards (and may soon surpass) the rates achieved by skilled operators. 

The economic case will ultimately determine the take up of technology in the warehouse, but the pandemic has forced businesses to re-evaluate their warehouse operations, so perhaps the longer term impact of this crisis will be a greater recognition of benefits of new technology.  Before the pandemic, the signs were that reducing automation costs, increasing focus on workplace ergonomics and reduction of heavy/repetitive lifting, limited labour availability, and increasing wage rates, were all seeing the benefits cases improve - leading to increased adoption of warehouse automation. Time will tell whether the increased focus on warehouse operations now, will leader to greater investments in the future, but I think the appetite will be there when we enter the post pandemic world.

Roger Platt, Senior Technical Adviser at BearingPoint, an independent management and technology consultancy.