News and Insights
INNOVATE. INSPIRE. DELIVER.
Replacing Humans In The Supply Chain Of The Future
It’s not just stores that need to embrace new technology, the warehouses that feed the stores with products and the onward delivery chain are under increasing pressure to up-their-game in a rapidly changing retail sector. But does this advance in technology mean that humans will just get in the way, or do we still have a part to play?
The MHI 2017 annual industry survey findings show that 80% of respondents believe the digital supply chain will be the predominate model within 5 years. If this is to be true, a lot needs to change!
Technology and methods of automation including; robots, warehouse management systems (WMS), self-driving vehicles and wearable technology are all set to play a key role in transforming this critical stage in the supply chain. The ultimate aim is to speed-up delivery times and reduce operational costs, and the expectations are high.
Rise of the Robots
Although robots aren’t yet as popular as WMS implementations, the likes of Amazon, Tesco and Ocado have been using robots to streamline picking, collate orders and handle pallet put-away in the warehouse for some time. Of course, these robots take on the appearance of autonomous cranes and vehicles, rather than something resembling a human.
Over the next few years, robots will become commonplace in warehouses, collecting and depositing pallets, totes and cartons to wherever they are needed.
A Chinese factory in Dongguan City replaced 90% of its human workforce with robots, which led to a staggering 250% productivity increase along with an 80% drop in defects! It’s hard to argue against the march of the robot army into the supply chain, with operational benefits on this scale…although, the capital expenditure is typically very high!
Critically, however, this level of automation isn’t yet advanced enough to cope with the unexpected. In order for robots to do their job efficiently, the environment and everything in it needs to be just right, including the condition and position of cartons and pallets. The variation that exists in real-life will certainly cause problems.
Multifaceted Benefits of a Warehouse Management Systems (WMS)
Just like all large-scale IT systems, a WMS is a sizeable investment for any company, but without one, many warehouses simply couldn’t operate efficiently enough to keep-up with today’s consumer demand.
One of the world’s largest seafood suppliers, Marine Harvest, successfully implemented a WMS to cater for 27 European production plants. As well as greater control over the inventory, the WMS provided central visibility to facilitate continuous improvement, a solution with the capacity to scale as the business grows, and a level of standardization to ensure the operation worked efficiently to handle the demand.
In other areas of retail, supply chains are being stretched to new levels as consumer demand now needs to be satisfied on a global scale, with the availability of products through online stores. A good WMS enables a more efficient warehouse but doesn’t negate the need for the workforce.
Last Mile for Self-Driving Vehicles
Autonomous vehicles have been deployed in the logistics industry for years but advances in self-driving technology is now finally being adopted more widely. Vision guidance technology relies on cameras that perform 360-degree depth scans of the environment to create a 3D map, which the vehicle then uses for navigation. Tesco, headquartered in the UK, recently used a robot to make its first ever grocery delivery in London within an hour of the order being placed, and DHL, among others, have carried-out similar pilots to test-the-water.
Air drones are also making the headlines. Amazon made its first public demo in the US in March 2017 where bottles of sunscreen were dropped off for attendees at a conference in California, and many more are expected to take place in the UK where current legislation on commercial drones is more relaxed.
Improvements are expected, according to business advisors McKinsey, who believe autonomous vehicles will deliver 80% of parcels in future and same-day or instant delivery will grow by 20-25%. They also state that a 40% saving in delivery costs is expected to be achieved.
None of these technologies can yet travel more than a few miles (not to mention the inability to cross a busy road!) so humans aren’t out of the picture just yet. In fact, whether travelling by ground or air, all these vehicles will need hubs to operate from, increasing the need for humans, even in densely populated areas.
Improving Humans with Wearable Tech
Unlike the other types of technology mentioned in this article, wearable tech seeks to improve the humans using it, making them more efficient, more accurate, and better informed. Online business resource professionals Supply Chain 24/7 announced that devices connected to the body improve operational efficiencies.
Smart glasses, arm-mounted computers and voice-picking streamline the picking operation in today’s busy warehouses. The next generation of smart glasses, like the Microsoft HoloLens, come loaded-up with features including; locating, spatial sound, and a very sophisticated visual overlay used to augment what the wearer can already see.
In November last year, supply chain industry specialists Arvato SCM Solutions started an order-picking project for Sennheiser using smart glasses. The company says the technology saved time and ensured a smooth flow of materials. They felt that a display integrated into the glasses gave warehouse employees all the necessary context-related information and helped them navigate more efficiently.
It seems like wearable tech certainly has a future in retail, but with a global population now exceeding 7 billion, it’s hard to imagine how wearable tech will replace humans in the retail supply chain.
Make New Technology Count
The completely autonomous supply chain is clearly some years away and may never arrive at all. However, with consumers driving a revolutionary agenda of immediacy and convenience, retailers will continue to innovate with technology and supply chain operations to outwit their competition. In the near-term, humans will still have a key role to play in the movement and delivery of products.
The challenge for retail must be, therefore, making the human element of the supply chain as efficient as possible by focusing on optimizing value-added tasks. Only the most adaptable and agile companies will flourish.
At REPL Group, we offer advice and solutions for both warehouse management and workforce management, tailored to your organization’s specific requirements to help you reduce costs and improve efficiency. If you’d like further information give us a call on +44(0) 844 752 0036, or fill out our online contact form and a member of the team will be happy to assist.