Automation and Robotics Go Arm in Arm

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Today’s robotics innovators arm warehouses and fulfillment centers with flexible and scalable automation solutions that are within reach for any company.

When a Delaware Macy’s department store with years left on its lease closed because of poor performance, managers knew they had an opportunity, not a failure. Doors were permanently locked to customers on Friday. On Monday, the same associates who smiled as they handed customers their purchases the previous week were acting as shoppers themselves, picking e-commerce orders from floor displays.

It was a temporary step in the facility’s dramatic transformation into a “dark store,” a brick-and-mortar location that has been turned into a micro-fulfillment center. Robotics are important to the operation.

“We started by tearing up the carpet, tile, counters, and fitting rooms, and turning the space into an empty shell,” says John Seidl, a partner with robotics and software firm GreyOrange.

When finished, the former store leveraged the labor and efficiency benefits of his company’s goods-to-person robots that bring hundreds of mobile shelving units to human pickers.

How Fast Can We Get Them?

It’s a sign of the times as e-commerce continues to grow while retailers and others struggle to find warehouse labor. Seidl cites a regional distribution center in Indiana that needs 100 people during peak periods, but has 20 open positions. “They told us, ‘We need robots. How fast can we get them?'” he says.

Hanna Yanovsky, general manager of Caja Robotics, has those same conversations with customers. “Every operation needs to be so efficient to meet delivery demands, and it’s not something humans can or want to do,” she says.

The pandemic and corresponding labor shortages aren’t the only factors leading to projections that worldwide commercial robot revenue in warehouses will have a compounded annual growth of more than 23% from 2021 to 2030, according to ABI Research. Today’s robotics innovators offer a range of automation solutions that are more affordable, flexible, and scalable than conventional robotics systems.

Robotics solutions are better suited to the growing number of smaller, more urban, micro-fulfillment centers. These facilities typically aren’t large enough for traditional expensive and immobile warehouse storage, retrieval, and conveyor systems.

New robotic automation options can also be up and running more quickly. “With large-scale, conventional automation, it’s 18 to 24 months from the time I start thinking about automating before I move the first box out the door,” says Dwight Klappich, vice president and analyst at Gartner.

Return on investment might take five to seven years, making automation better suited to companies that are large, have big problems, and have the capital to invest, Klappich adds.

With steel prices at an all-time high, “the return on investment for conventional automation is less attractive,” says Rueben Scriven, senior analyst for warehouse automation at Interact Analysis.

Off the Charts Demand

It’s good news for robotic solutions providers—GreyOrange has doubled in size during each of the past two years, for example. Klappich understands why, saying demand is “off the charts.” But so is the number of options, which can cause many warehouses that need automation to delay adoption.

While robotic automation systems can be operational sooner than conventional predecessors, selecting the best solution from all those options takes time.

What’s more, if you’re turning to automation to solve more than one problem, you probably won’t get everything you need from one vendor. Just as warehouses use different brands of materials handling equipment, they need multiple types of robots provided by several vendors. It’s why some robotics companies are acquiring brands with different product offerings, such as Locus Robotics’ recent acquisition of Waypoint Robotics to expand its product offerings.

“There’s a trend toward offering complementary solutions as an end-to-end process, with firms starting to mix and match technology,” says Mike Futch, CEO of Tompkins Robotics. “For example, we have robotic sortation, while other vendors offer robotic storage and retrieval, and still others provide robotic packaging.”

“Caja Robotics has done projects in the United States where ours is the main element, but there are additional solutions that link to ours from beginning to end,” adds Yanovsky. “This is an important element for customers.”

While some companies are anxious to implement robotics quickly, others that know they need to add automation to speed throughput, maximize storage space, and improve safety remain reluctant to move forward. “A surprisingly small percentage of the warehouse population uses robotics,” says Scriven.

Fear of Change

A primary obstacle to adoption is fear of change. “People are terrified about blowing up their fulfillment strategy,” Seidl says, adding that inertia is his biggest competitor.

“The amount of change management in robotics systems is dramatically higher because you eliminate and completely replace the existing process,” he notes.

Even so, robotics offer lower-risk solutions. “Nobody wants to waste money or make a big mistake, but they don’t have to be as afraid about getting it right because the cost to switch isn’t as high,” says Klappich. “Some companies bring in five robots that do what they expect them to, then add five more, and then another five more.”

Another problem with the low adoption rate is there are fewer industry mentors or colleagues who have gone through the process to learn from. “You need to be personally and professionally brave and the company you work for has to be brave,” Seidl says.

“It’s a huge step forward for them,” agrees Ilan Cohen, CEO of Caja Robotics. His firm often overcomes reluctance by piloting automation in a small area of a warehouse before expanding. “This allows the company to see that they can still work hand-in-hand with other areas and that automation doesn’t interfere with operations,” he says.

Understanding that robotics solutions are more flexible than conventional, large-scale automation also helps reduce anxiety levels among Caja’s customers. Starting gradually and showing that they can make adjustments helps overcome hesitancy, Cohen adds.

Flexibility applies not only to how and where a company uses robotics in a warehouse, but, thanks to robotics-as-a-service, also to how many they use and when. With this innovation, companies can upgrade or downgrade as needed by leasing technology.

“With conventional, fixed automation, you either have to build the system to handle maximum capacity with some going unused throughout the year, or build it for normal capacity, then flex with manual labor for peak periods,” says Scriven. “With robotics, you can lease that automation briefly for peak periods.”

Tompkins Robotics plans to introduce robotics as a service in 2022. “During the holiday season, customers can double their capacity with more robots, then return them,” says Futch. Tompkins Robotics customers use its sortation robots primarily for e-commerce fulfillment, store replenishment, and parcel shipping sorting.

Working with a consultant to make sure you make the best decisions for the situation can also help, but there are more automation options and configurations than there are advisors.

“You need a consultant who isn’t aligned with a particular manufacturer and can look at the warehouse, understand the situation, and create a mission profile,” says Jordan Teplin, strategic account manager with robotics consulting firm MacGregor Partners.

Finding someone with the right experience can be a challenge. “Most robotics people work in warehouse control systems while warehouse people use warehouse management systems,” Futch says. “Many companies try to bring those two together so there’s one brain, not two.”

Make a List, Check it Twice

Yanovsky recommends using a methodical approach to understanding options and making an informed decision. “List and prioritize needs,” she says. “Identify pain points, then get educated about solutions.”

Automation is no longer a “nice to have” but a “must have,” she adds.

Factor in software integration capabilities when exploring vendors. “Make sure the robotics vendors you consider have already integrated their control systems software into the warehouse management system or ERP solution you use,” says Seidl. He also recommends working with a provider that has experience in your industry segment.

The technology is new enough and the market large enough that there’s a sense of collaboration rather than competition among providers. “It’s the dawn of a new era,” says Futch. “Robotics automation suppliers have created and are refining unique, innovative solutions to address today’s challenges.”

“The market is so big that everybody will find their cup of tea,” adds Cohen.

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