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Robotics Drives Supply Chain Profits

A recent Information Services Group (ISG) study suggests that something big is happening: 72% of information services (IS) enterprises plan to increase their investment in robotics by the end of the 2019. Why? Because automation and IS are a natural fit.

Leading companies worldwide are beginning to use robotics to boost their warehouse efficiency and forecasting capabilities. And an improving price-to-performance ratio associated with robotics technology means that usage is sure to continue expanding.

Image courtesy: Universal Robots

Image courtesy: Universal Robots

The advantages of automation

New automated technologies are a game-changer. Until recently, available robotic devices were stationary and couldn’t interact visually with their surroundings or respond to unexpected inputs. Today, robots are mobile and collaborative. High-res cameras, pressure sensors, navigation lasers, and acoustic warning indicators allow automated devices to navigate warehouses efficiently and autonomously.

Recent technology upgrades include software that causes a robot to cease activity temporarily if it encounters an unexpected object or input, meaning that these devices can safely work alongside humans. Whereas earlier robots were used mainly to transfer objects from one place to another, more recent technology can enhance tasks ranging from managing inventory to retrieving, assembling, and packing orders.

Industry leaders have invested in automated warehouse management systems (WMS) with undeniable results. After major investments in automated fulfillment centers, Amazon has seen a 50% increase in capacity when compared to facilities that don’t use robotics. Amazon has even acquired the company that creates its robots, indicating Amazon’s confidence that the continued production and development of automated technology will play a big part in their future.

JD.com, China’s largest online retailer, has gone even further. Boasting the world’s first fully automated e-commerce warehouse, JD has equipped the 43,000-square-foot facility with 20 industrial robots that allow the company to provide same- and next-day delivery to more than 1 billion customers. Whereas a standard warehouse of that size would require nearly 500 workers, JD employs just 5.

Streamlining operational staff offers a big pay-off. On average, a warehouse employee wastes almost 7 weeks per year in unnecessary motion, which adds up overall to $4.3 billion in labor expenses. For employees, simply walking around in the warehouse accounts for 50% of the time involved in retrieving orders and checking inventories. Coupled with the potential for human error, the superior efficiency of robots makes it a question of “when?” rather than “if?” automation will become the new norm in parcel-sorting hubs and distribution centers.

Automated guided vehicles

The robotics revolution is already underway. One of the most widespread and effective uses of robots in warehouses is the automated guided vehicle (AGV). These self-driving vehicles are rendering expensive and single-use equipment like conveyor belts and large loading vehicles obsolete. Battery-monitoring systems send AGVs back to their charging ports when necessary, maximizing the efficiency of their operation. AGVs can be directed by voice or programmed to retrieve orders, guided by physical markers, magnets, and vision systems. In addition to navigating a warehouse floor more quickly and efficiently than human employees, AGVs are also capable of lifting and transporting much heavier weights, allowing for a larger number of orders to be retrieved in the same amount of time.

The advantages of AGVs run deeper than warehouse efficiency, however, and extend to logistics operations as well. AGVs track and update inventory records in real time as they retrieve orders. Ordinarily, the immense amount of data involved in running supply chains creates inefficiency and requires additional personnel to monitor inventory levels and place orders. The AGV integrates these tasks into a streamlined operation, as it can retrieve items as soon as order data is received and updates inventory levels instantaneously, even placing automatic purchases. This allows for improved forecasting and faster inventory refill.

Effi-BOT & Sawyer

That’s all very well in theory. But how does it work in practice?

DHL has led the pack in using robots to assist employees with repetitive and physically demanding tasks. Effi-BOT, an AGV that follows employees through DHL warehouses, takes over the physical work involved in picking orders. The use of Effi-BOT has allowed DHL to move from single-order picking to a multi-order model, and helps track complex inventory dynamics.

Another robot, Sawyer, has illustrated how automation can be used in flexible ways to accommodate ever-changing purchasing and order patterns involved in e-commerce. Sawyer’s collaborative capabilities allow it to handle repetitive aspects of the co-packing process. By adding Sawyer to its existing workforce, DHL has been able to use the robot to flexibly adjust to unpredictable order data.

Image courtesy: DHL

Image courtesy: DHL

Managing robotics

Typically, the inventory and performance data generated by devices such as Sawyer and Effi-BOT is aggregated in a dashboard that supply chain managers can use to check inventory levels and review automated requests sent from robotic devices to purchasing departments. By integrating data recorded in real time by automated devices, dashboards make larger and larger segments of the supply chain visible, allowing managers to pinpoint the source of problems, such as a delayed order from a supplier’s factory.

Robotics thus offers enhanced efficiency for both warehouse capability and predictive supply chain management. While the regulatory policies surrounding the use of robotics in the workplace are as yet uncertain, there can be no doubt that automation is already re-shaping the supply chain. Successful companies of the future will be the ones that find ways of taking advantage of new robotics technology today.

7 comments on “Robotics Drives Supply Chain Profits

  1. EdwardThirlwall
    June 13, 2019

    Every industry have certain job scopes that can be taken over by machines completely. This would not only save the company time and effort, but they can also minimize human error. It is like providing the company with a solution that saves them money too. The party that has to worry would unfortunately have to be the employees as they might be considered redundant in the future.

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    June 18, 2019

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