Encompassing pivotal tasks, such as material movement, sorting, picking and putting away, merging, conveying, packing and more, warehousing is paramount for the present day enterprises. As the customer demand for speedy deliveries continues to grow, warehousing today needs to be efficient and quick, with zero scope for error. Further adding to the woes of warehouse managers, there is growing complexity of SKUs, need for flexible operations to cover gifts, fragile and express orders, time definite orders and more. While warehouses manage the same, another growing concern is the emergence of multiple sales channels, need for accurate inventory, the demand side uncertainties and availability of skilled and semi-skilled workforce.
Hence forth, warehouses empowered with smart technology and automation, wouldn’t remain a luxury any longer but will be an essential ingredient for the sustainable growth and longevity of businesses.
Tremors of Change in the Economy
As an economy, we stand at the cusp of a technical revolution today. A little tremble initiated by the nascent startup economy has touched and inspired myriad industry verticals, including the warehouse section of the supply chain and logistics chain.
Take for instance the rise of ecommerce industry, which has the ecommerce logistics industry piqued at becoming a USD 2 billion industry by 2019. With the Indian Government investing in skill development and encouraging foreign giants to establish their manufacturing units in India, following the Make in India campaign, the logistics segment already witnessed a 60% growth in the first half of 2015.
Now, with the introduction of GST, along with the mighty leaps taken by the ecommerce industry and the advent of hyper-local marketplaces, the future of warehousing lies in smart technology.
Smart Technology to Boost Efficiency
According to Vineet Baid, CEO, Falcon Autotech, With the advent of Internet of Things (IoT) in the field of logistics and warehouse management, is increasingly becoming part of the supply chain verticals across different frontiers. IoT devices are able to offer diverse value, solve an extensive range of problems effortlessly. Take for instance the commercial telematics, which are now being widely used in the trucking fleets to enhance the efficiency of logistics. Another emerging technology, smart fabrics takes care of the manufacturing processes and human health with the utilization of sensors within industrial fabrics and clothing.
Taking a closer look at the companies deploying IoT, one can better understand the utility offered by Smart Tech and how easily it is able to take care of the daily operations and holistic efficiency of the unit. Case in point, Lids, which has utilized the IoT enabled robotics system in order to have robotic carts pick, place and deliver products from specific locations to workers. The athletic sportswear company has since then been able to make the entire process much more efficient, optimally utilizing the human resources and capital. Furthermore, UPS has been able to reduce its cost of labeling on packages, after deploying the smart glasses.
These technical upgrades are no longer the luxury being enjoyed by large scale logistics and ecommerce companies, with fancier budgets. Gartner, based on its industry study, expects the increase in the internet-connected devices to have a 30x increase by 2020. It further foresees the deployment of more than 26 billion installed IoT devices by 202o. Another study, conducted by Zebra technologies, discovered that 70 per cent of decision makers have planned to expedite the use of technology, with a view of creating smarter warehouses by 2020.
Such massive plans for introducing smart technology in warehouses are not much ado about nothing. Since warehouses are no longer places to store inventory, technology has been widely used to make the process efficient and quick. IoT devices, along with sensors and radio-frequency identification offers better visibility to the warehouse managers, letting them know the exact location of a product and developments on the same.
The wearable technology presents better mobility solutions to the workers, letting them take care of more work, without necessarily having to stay at the workstations. Another general trend observed within the companies that have deployed Internet of Things, have experience a reduce in their labor costs, increased speed of operations and accuracy in shipments, whilst offering clear tracking and visibility for the retailers, hence winning their trust and confidence.
Welcoming the awe-inspiring automation & robotics
The use of robotics in the field of warehouse management seems to be the next big disruption in the domain. Amazon proved to be one of the earliest movers in the field, investing USD 775 million to have robot maker Kiva Systems revolutionize its warehousing functions. The ecommerce giant then had 15,000 robots working in its facility, moving entire shelf units and the number has only grown to to 30,000. In their bit to further fuelling the innovation and have robots handle more critical tasks, the company then launched the Amazon Picking Challenge, encouraging the genius and mavericks from the field of mechanical engineering to design robots which are able to handle critical tasks like picking objects from the shelves and placing them at desired destinations.
Furthermore, in order to further streamline supply chain processes and make the fulfillment center more proactive than reactive, the ecommerce giant has also proposed the use of drones. From drones, the wave of innovation and technology takes us to the driverless trucks, a concept the global giant internet company, Google, seems to be working on.
Deploying advanced software and sensors to do all the hard work, Google currently is endeavoring to automate delivery of goods and consequently, reduce the requirement of parking and making the delivery of goods within warehouses and hub spots more efficient.
While issues like warehouse layout, capacity planning and ensuring optimum mobility of the inventory has always daunted warehouses, smart technology is here to take the pain away from the same. As we prepare ourselves to witness the next dawn in technology, we can easily aspect more innovation and automation in a wide gamut of logistics verticals, most importantly the warehouse management.
Roadblocks Requiring Resolution
There are naturally limitations towards the successful stride of automation in the field of warehousing and management. The disparity within the deployment of technology seems to be one of the challenges we are yet to overcome as an economy. While our western counterparts have displayed awe-inspiring agility in integrating the technology, labor-intensive countries like India and China, continues to resist the advancement. Till the time labor remains easily affordable, it is difficult to expect ecommerce companies, government or the multi-nationals to really invest in mainstreaming automation in warehousing.
However, the emergence of contemporary companies and startups in the field of automation, big data analytics and Internet of Things bring a ray of hope. These companies, with their efficient pricing models and cutting-edge technologies are making giant strides in the industry. Post the Make in India campaign and the government endeavoring to promote technology and innovation, I feel optimistic towards the resolution of this particular roadblock in the coming times.
However, in addition to the upfront deployment costs, smart warehouse technology is also accompanied with concerns regarding increased maintenance costs and power consumption. Entering into associations with reliable technology partners, who have already demonstrated their capabilities and proved their mantle, is surely the way ahead. Furthermore, utilizing alternative sources of energy, perhaps taking a cue from the global giants like Walmart and Amazon turning to Tesla for power conservation, would further facilitate the transition towards smart tech in warehousing. At last, I reiterate the cusp of technical revolution at which we stand today, one may only imagine the overhaul of the warehousing sector by 2020.
Note: Article Featuring Falcon Autotech was Originally Published in Warehouse Management Magazine, November – December 2016 Issue