This article originally appeared in the September/October issue of PARCEL.
Before e-commerce sales consumed 8.5% of retail sales, warehousing could be a much simpler affair for many companies. You would bring products in by the truckload, store them until orders were placed, and then ship pallet and case quantities out to wholesalers and retailers. If there were spikes in demand, you could find low-cost labor willing to put in the hours to meet the demands of the warehouse. Is that the case for your business today?
Not likely, because as consumer demand continues to shift from big box to online, companies struggle to adapt their warehouses to meet the changing customer demand and workforce instability. Where you used to focus on receiving pallets in and shipping pallets out, you are now faced with demand across multiple order sizes over a multitude of channels from wholesale to end consumer.
To compound the frustration your company feels, you are bombarded with information on new devices, technology, and services that you are told will guarantee your survival in the rapidly changing distribution landscape. What you need to do is block off much of the noise and focus on a step-by-step plan to ARM yourself and your business for success.
ARM is a framework that our company has developed to explain current warehouse technology space as well as provide a step-by-step plan for moving from legacy warehousing to the warehouse of the future. By determining where your company is on the framework, you can implement a plan to move from your current technology base to the next generation of warehouse technology.
ARM stands for:
A – Analyze
R – Retrofit
M – Modernize
What a company can do is look at what each area offers, determine what they have, and what needs to be implemented in the future.
What follows is an example of a few tools that can be utilized when a company is walked through the framework.
In the “Analyze” phase, the greatest benefit comes from analytic tools that allow you to know how your warehouse is performing and will lead to greater operational improvement.
1. Advanced Data Collection and Reporting Systems
With the increasingly ubiquitous nature of big data, the conversation continues to change from storing big data to how we are collecting and analyzing our data. This is where the next generation of cloud-based advanced data collection and reporting systems come into play.
Companies need to make rapid decisions based on their data, and the reporting engines that are available in the cloud can deliver real-time analytics across the company and with trading partners. As these systems have evolved, it allows companies to speed up their decision making and adapt to changes in operations.
In the retrofit phase, you are taking the data you have analyzed from the analysis phase and implementing tools that can be easily bolted on to existing systems and warehouses.
2. Voice and Vision
Utilizing voice and heads-up displays, companies are reducing or eliminating employees inputting data into handheld or truck mounted devices. This is reducing dwell time that employees had using screens and giving employees visual and voice cues to what work needs to be done. This is also reducing error rates and speeding up the pick and ship processes.
3. Out of the Box Automation
The current generation of robots on the market are creating flexibility in deployments. Some of the companies in this space are promoting systems that have reduced the setup time from months to a week. These systems are greatly reducing travel time of employees and helping fill workforce gaps that many companies are facing.
In the mechanize phase, companies can move beyond retrofitting and create fully autonomous sections of warehouses or utilize greenfield sites to build new highly automated facilities.
4. Autonomous AGVs
When moving products from either manufacturing or storage to picking, companies are now able to replace reach truck drivers with autonomous AGVs. These systems can automate many long-distance pallet moves and free up labor to focus on other value-added activities in the warehouse.
5. Automated Picking and Packing
While automated picking systems are still limited to easily stored and some light products, within a few product generations, we will see systems that can handle a high percentage of picks across a variety of products. Another area that can be automated is packing. Automated arms are able to take products off of picking lines and pack them into boxes with little to no human interaction.
With many shippers encountering changing market conditions, they are struggling to keep up with the market demands. Following a structured path to making changes in the warehouse will give companies they building blocks they need to add additional functionality to their systems and material handling abilities.
Are you ready to ARM yourself for success in creating the warehouse of the future?
Chris Elliott advises the C-Suite and Top Executives on Supply Chain Strategy, Technology, and Change Management as a Consulting Manager at Blue Horseshoe Solutions. He can be reached at email@example.com. Join him at 9 am on September 20 for his session at the PARCEL Forum in Nasvhille, where he’ll expand upon this topic in more detail.