With competition from larger companies nipping at your heels and news about supply change problems a daily reality, it seems overwhelming to also keep an eye on productivity. Adding insult to injury, labor shortages are also an issue that the warehouse industry is facing. It is good news that, with the latter, you may have some options. Optimizing warehouse productivity with automation is an excellent option that not only boosts output even with a limited staff, but it may also help you better deal with the competition.
What are the Productivity Key Point Indicators (KPIs) to Watch?
How do you know that your productivity could be better? Conversely, how do you know the automation you add makes a significant difference? Selecting KPIs helps you track performance before, during, and after adding automated components.
Possible KPIs may include:
- Hourly output. How many products do you manufacture per hour? Once you add automation, repeat this measurement.
- Order cycle. This KPI measures the time it takes to transition from receiving an order to having it ready for shipping.
- Processing cost. One of the most important indicators is the cost for each order you fill. Factor labor costs and materials, and repeat the indicator measurement after introducing automation. Whenever you change your production line, this is a critical key performance indicator (KPI) of success.
Automation Opportunities for Today’s Warehousing Business
There are several ways to optimize warehouse productivity through automation. It is essential to realize that you do not have to add all of them to make significant KPI improvements. Moreover, rather than introducing all of them at once, the automation should be spread over a longer period, which allows it to pay for itself. What are the options?
Automated Storage and Retrieval Systems (AS/RS)
If you already have a lot of products in storage and would like to work ahead of incoming orders, AS/RS systems automatically place and retrieve products from storage locations. You speed up your inventory handling, reduce labor costs, and minimize picking errors.
Conveyor and Sortation Systems
Another example of warehouse automation efficiency is a conveyor system. It automates the movement of products throughout your facility, to and from loading docks, and across picking zones. Most importantly, you can connect conveyor systems with AS/RS systems. Conveyors shorten the time between manufacturing and the delivery of orders.
Automated Guided Vehicles (AGVs)
Self-guided vehicles transport products across the warehouse floor without human intervention. These are good options to increase safety and allow for around-the-clock operations.
Warehouse Management System (WMS) Integration
Think of the WMS as the brain of all automated systems. It coordinates automated systems (AS/RS, conveyors, AGVs) and optimizes product placement and retrieval based on demand.
Automation Will Most Likely Not Replace All Employees
It is a common misconception that optimizing warehouse productivity with automation means you will no longer have labor costs. While there is a good chance that it reduces labor costs, there are still plenty of manual tasks that require trained employees. Moreover, manual labor occurs when the machinery deals with a situation outside its programming.
That said, there is a good chance of pushback whenever you introduce automation. Avoiding it will require proactive attention.
- Involve employees in the automation process. Nothing is worse than leaving on a Friday, returning on a Monday, and being greeted by AGVs. Your workers need to know what automation you will introduce and how it benefits them.
- Train employees to work with automation. Optimizing warehouse operations with artificial intelligence and machine learning will not happen if employees do not know how to interact with the technology. As a result, you will likely have inefficiencies that adversely affect KPIs.
- Formulate a long-term plan. The KPIs show what is working, what is not, and where you may be able to reduce labor costs but boost productivity. It is impractical to make too many changes simultaneously, particularly as technology keeps changing and upgrading. We recommend adding one system at a time to integrate it fully into your warehouse management.
The Future of Warehouse Automation
Warehouse layouts will likely change to accommodate autonomous robots, automated order processing, picking, fulfillment, and inventory management. In simplest terms, any actions involving moving inventory inside and outside the warehouse will be automated. The goal is to increase productivity and customer satisfaction. Fewer human errors result in fewer missed orders, product waste, and excess inventory.
However, there is the possibility that automation looks different for some businesses. Digital process automation is an excellent option for a company that has invested in software applications, a data analytics platform, and mobile interfaces. Here, workers will follow the leads of the information they receive. Another option is physical automation. Robotics is a big part of this movement. Workers will frequently interact with the machines to ensure automated tasks follow orders received and correct input.
While it is possible to combine the two, doing so is frequently an option for mid-sized to larger commercial warehouse operations.
Technology to be on the Lookout For
- Goods-to-person (GTP) fulfillment increases warehouse picking productivity.
- Autonomous mobile robots (AMRs) go beyond basic AGVs and will do more than simply transport inventory.
- Pick-by-voice technology lets employees interact with automation via speech recognition software.
Problems of Automating One or More Elements of Your Warehouse Operations
When technology works, it is fantastic. However, there are several drawbacks to consider before you commit to full automation.
A Large Expense
Automation is expensive. It will seriously dent your budget. It is possible that some companies will not budget wisely and, therefore, overextend themselves. Additionally, some technology will become redundant in short periods. You may find that something you invested in three months ago is no longer top of the line today. Do your research before paying for any automation.
Technology Dependence May Cause Problems
You are at the mercy of functioning machinery and software. What happens when the internet goes down, a software bug out, or you get hacked? Similarly, what will you do when a key piece of automation malfunctions and requires repairs? Depending on how long it will take you to get back online, there is a good chance that, rather than boosting productivity, the move to automation will decrease it.
You Need Workers Skilled in Multiple Disciplines
We have already discussed the importance of including your employees in the automation process. However, consider whether you want them to function primarily as monitors or whether they will take an active role in programming and repairing machines. The former can return to the manual way of doing business with little effort. The latter may be able to fix machines, but they are likely not able to handle production manually.
Should You Invest in Warehouse Automation Today?
Optimizing warehouse productivity with automation is a good option when you run out of storage because your warehouse layout is used inefficiently. Moreover, labor problems, sharp order increases, and ongoing mistakes with picking or shipping orders are indicators that automation could be the correct answer for your situation.
If this is you, ensure that any technology or automation you invest in is scalable. Because increased productivity will likely cause your company to grow, the technology must grow alongside it. Anything that cannot be effectively expanded will not work for you in the long run. Consider workarounds if you have to wait until you find the right technology for your needs.
Examples include warehouse drones, which will work with a WMS to track your inventory. Radio frequency identification (RFID) sensors are an excellent placeholder for inventory tracking and supply chain management. Last but not least, remember that there is a concerted push to bring sustainability to all sectors, including warehouses. If you are considering going the route of automation, keep an eye on energy usage, waste generation, and the impact the technology will have on your company’s carbon footprint.
By the way, if you need new pallets for product storage or movement right now, why not work with the team at Pallets Yesterday? Call us today to discuss your next palette order!
