Given the uncertain economic future facing the United States and the rest of the world, it shouldn’t be surprising that a survey of company executives conducted by Honeywell Intelligrated found that while many may wish to be on the leading edge when it comes to warehouse automation, they are equally committed to avoid being on the bleeding edge of this technology.
Overall, businesses have a positive outlook on growth and will be relying on warehouse automation processes to maintain that optimism, according to a survey conducted by the company last spring with the help of KRC Research (AA, 7-31-20, P. 3).
The survey also found that the same executives are aware of the need to cultivate skilled employment in the warehouse workplace to manage and maintain these investments.
The poll revealed improving automation processes is the most common top-ranked goal for supply chain managers over the next one to two years.
When given a list of possible goals, 14% of companies ranked improving automation within their facilities as their top priority, and 37% of all companies rank it as one of their top three goals for the near term.
In spite of their recognition of the importance of improving automation processes, only 43% of companies that list automation as one of their top strategic goals also say they are very prepared to achieve it, the study found.
“Distribution and fulfillment operations often struggle with how to plan and execute the transitions to automation. The COVID pandemic has accelerated conversations around defining the right technology and solution strategy and deployment plans for their respective business,” explained Christine Feuell, chief marketing officer of Honeywell Intelligrated.
“For example, the e-commerce industry has experienced rapid global growth from users of all generations due to stay-at-home mandates and social distancing requirements. and more consumers are adapting their shopping behaviors as they see the convenience it provides.”
According to Feuell, these shifts in how consumers buy and choose to take delivery of their orders influence the types of automation and fulfillment strategies that companies will need for helping to achieve the customer service levels that customers have come to expect.
The National Retail Foundation and other observers have quantified enormous growth in shopping online as a result of Covid-19, and those numbers are expected to rise as the pandemic lingers, diminishing and surging in stages over the coming months, the researchers pointed out.
For supply chain executives who have piloted an automation solution, they have discovered the results to be overwhelmingly positive, the study found. More than 85% say the solution has led to positive business outcomes for their companies, and half say those positive outcomes are significant.
Cost of implementation is the main reason for hesitance of investment in automation, with nearly half of companies polled mentioning it as a major barrier to automation adoption.
The consumer packaged goods (CPG) industry is the leading industry sector where executives are balking, with 55% of respondents saying cost of implementation is the biggest barrier to adoption.
One third of all of those surveyed mentioned the difficulty or complexity of implementation as a barrier to automation adoption.
As an example, nine in 10 companies said they see positive outcomes using automated storage and retrieval solutions (AS/RS) technology, a widely used automation solution across industries. On the other hand, eight in 10 of them also offered that implementation remains a challenge.
As fast delivery continues to become table stakes in various industries, companies are creating micro-fulfillment centers in or near city centers to maintain high levels of customer service, the researchers noted, including conversion of big box stores and malls into distribution facilities.
The Human Factor
While this automation technology has been proven to maximize efficiency and productivity in multiple industries, there is a major investment in time and training required as well, Honeywell Intelligrated observed. The process of installation, labor training and integration into other software systems can take anywhere from 12 to 24 months.
“Companies need to understand that installing new automation technologies is not plug-and-play, and these solutions need to be integrated into their software and control systems to ensure they enhance operational performance,” Feuell said.
Executives whose companies have chosen to invest in automation report that most the important limitations originate from high cost of maintenance (55%), frequency of maintenance, (42%), lack of
flexibility or adaptability (35%), difficult user experience (29%), lack of interoperability (29%), and “clunky” robotic components (27%).
For example, automated storage and retrieval systems (AS/RS) shuttle technology helps move higher volumes of product and make the best use of valuable storage space. In spite of, nine in 10 of the executives saying they are seeing positive outcomes, eight in 10 admit that implementation is (or was) a real challenge.
Automation Grows Employment
As automation in supply chains progresses, it can lead to opportunities for new jobs within different workplaces. Two in three companies see opportunities for new and different jobs in customer service, distribution centers and warehouses, according to most of the executives surveyed.
In September, the Bureau of Labor Statistics reported that overall warehouse employment had exceeded its pre-pandemic level, growing to become the largest number of people working in the industry in recorded history — a total of 1.25 million workers employed in the sector. BLS also reported that for October warehousing recovered 170% of the jobs it had lost from February to April.
Most new warehouse jobs require more advanced skills than the jobs that automation is replacing. “These automation and robotics advancements are shifting the workforce away from physically demanding, strenuous and monotonous tasks to more skilled tasks,” Feuell noted.
The study revealed that eight in 10 company executives see the highest potential for new jobs arising in-house maintenance roles. (Remember that 42 of respondents also mentioned the costs and frequency of maintenance as the most important limitations restricting the use of automation technology at their companies).
As infrastructures within warehouses and fulfillment centers become more automated, Feuell stressed the crucial role that maintenance technicians play in helping to limit downtime.
She said, “Even though machines are getting smarter, humans are still needed to program, build and repair them. Human intelligence is still essential to identify problems and mobilize computers and people in tandem to get the job done.”
