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Get the big wins from automation

Published: 01 May 2011  12:00 AM
Industry Channel: Materials Handling 

The problem with automation is not just knowing whether to automate - it's also knowing what to automate. Vanderlande calculates that order picking can account for 50-60 per cent of the cost of a manual warehousing operation - and a lot of that is down to the picker walking around - so that is an obvious area to look at.

But Stephen Szikora, IT director at logistics specialist NFT, says: "I would advise only automating those elements that provide a payback, but not at the risk of moving or incurring extra cost elsewhere. The ROI must be holistic; we must look at the whole picture.

"Generally, I find that high volume, repetitive tasks such as storage and retrieval, carton labelling, wrapping and any sortation are best done by automation. High value goods are especially suited to automated control."

Keith Edmonds of Logistex, points out that ROI performance depends totally on the nature of the business, the company and its objectives, so the best ROI will differ in every case. "What is important is to have the data and systems in place to be able to assess the ROI of alternative courses of action before committing to a long-term investment."

And Swisslog's James Sharples says that often pockets of automation to address specific tasks provide a better ROI than trying to automate the processes of a complete warehouse. "However, it should be noted that while fast moving products can be automated, it can be equally or more effective to look at the slow movers too."

Vanderlande says many companies are now looking at end-to-end cost when looking at warehouse automation. "They don't only look at benefits and ROI within the DC, but also for example include transport cost to the store (e.g. reduction of transport cost because of better stacking on the pallets) and cost for in-store logistics (eg family grouping, shelf ready delivery). This is important because the majority of the cost in the supply chain is made in the store (eg filling of the shelves, space cost in the store).

Dave Bull, sales manager at Dematic, points out that while picking has traditionally been a key target for automation, an area ripe for improvement especially in e-commerce operations is the packing process.

And Bull points out that: "Entry level technologies such as voice picking or laser-guided trucks can provide an almost instant win. Pockets of automation, often referred to as mechanisation, can provide specific immediate and obvious benefits such as a transport conveyor linking two process or a standalone ASRS store saving footprint."

Equally, says Brian Whale, senior logistics consultant at Swisslog, cost-effective full automation is difficult to achieve as often manual processes are required to support an integrated automated solution. "Partial automation provides the opportunity to extend the life of an existing facility while also minimising short-term investment," he says.

Developing technologies
Ian Channing, head of customer support at Swisslog, points out that the ever-increasing costs of skilled engineering staff means that new technologies must take into account the ongoing life cycle costs from a maintenance and support perspective. "The technologies that consider this cost will have a large impact."

Vanderlande sees a trend towards higher levels of automation such as goods-to-man systems for item picking and fully automated case picking systems.

"Customers indicate that it is very difficult for them to get staff to work in the warehouses (demographical developments). Also they have a high staff turnover. This creates need for high pick performances and short learning curves. They want to offer employees an attractive working environment with minimal health & safety risks. This means ergonomics is a very important attention point. Furthermore, it is difficult for them to acquire large pieces of land to lay-out conventional manual DCs (especially in urban areas). This creates need for warehouses with higher storage density. Finally there is a need to improve the accuracy. In a typical manual food retail DC the accuracy is 98 per cent. With a throughput of 100,000 cases per day, this means 2,000 cases per day are wrong."

Keith Edmonds says: "From a pure technology point of view, the industry takes advantage of innovations from the wider world. On a global scale the biggest and fastest developments are in IT and control systems, with ever-more powerful technologies and lower costs. So it is likely that wider use of more powerful software systems will have the greatest impact in the near future."

Dave Bull points to the growth of multi-shuttle systems. "Although not new, they are still an emerging technology and the uses to which they are deployed are constantly evolving. Very much interlinked with shuttle technology is the very high productivity 'Goods to Person (GTP) stations' allowing picking rates in excess of 800 lines per hour per operator - both technologies are ideally suited to single item picking and therefore internet retailing."

And NFT's Stephen Szikora expects the market for RFID in the supply chain to mature further. In the longer term, he says: "Inventions such as RFID inks will combine RFID and barcodes into a single technology. Better and more accurate GPS will also fuel automation in vehicle yards and container docks."

Automation can be an important tool in improving storage densities at a particular site. Bull points out that automated storage and retrieval systems (ASRS) are an established technologies and allow for very dense storage of both pallets via automated stacker cranes allowing heights of up to 40 metres and for smaller unit loads such as totes or full cases - miniload and multi are available.

Szikora agrees, but warns: "Without investing in purpose-built premises, most solutions are a compromise on geography, height, shape, loading bays and the multiple storage media forms needed to support the product. Uniformity is a key requirement to success in denser storage and automation. Most automation providers offer some unique storage and handling solution for a variety of requirements to this end."

Swisslog's James Sharples highlights the potential of automated high bay storage which allows goods to be stored at increased heights (up to 50 metres) than storage serviced by manned equipment. It can also eliminate the need for access aisles and rack clearances. For example, the AutoStore system allows totes to be stacked in a very dense floor grid, with robots running above to eliminate all of the normal space associated with conventional crane storage."

And Edmonds, points out that whether manual or automated, a typical warehouse will have a maximum theoretical storage capacity, whether measured in pallets, totes or other type of container. "A well-designed warehouse software package will allow the user to get closer to the theoretical maximum by knowing instantly where there is space available and how it can be best used."

Cost of ownership
It's always tempting when committing large amounts to a long-term project to allow price to have an undue influence. However the cost implications of not having the most suitable configuration or a system that is not up to the job for handling the predicted volumes will far outweigh any reasonable up-front savings.

In the long run, says Edmonds, "if the system and equipment are robust enough for upgrade and refurbishment (such as projects Logistex has recently carried out for Wincanton, United Biscuits and Spicers), the life-cycle savings start to become significant."

Andy Blair of Swisslog believes users are becoming increasingly aware of the importance of total cost of ownership, but calculation methods vary widely and historic data is often inconsistent due to a wide variety of implemented systems.

Stephen Szikora also highlights the importance of total cost of ownership. "Organisations do take this into account and analyse this to very deep levels due to geography, land and building costs, transport, wage and productivity constraints, as well as to business growth and flexibility."

However, he says: "Currently, financing can be quite a challenge and businesses are seeking to provide even more robust cases to obtain financing. I don't feel there is an appropriate mechanism for a certain automation solution; it's more tailored to the businesses' financial needs."

Dave Bull, points out that most customers will fund the project or raise the capital themselves. "However it is now possible to lease a system and we are happy to introduce specialist leasing companies to our customers."

He also points out that most service contracts are now negotiated as part of the main bid process so the customer can have full visibility of the full life cycle cost of a system.

Edmonds agrees that an all-inclusive contract can make sense. "As systems and equipment become more sophisticated and downtime implications even more severe, it makes more sense to place the service and maintenance with the supplier than to depend on ad-hoc arrangements or in-house general staff."

But Szikora points to a range of factors. "This depends on the solution requirements, the number of parties to integrate in the total solution and the skills of individual organisations.

"Projects can be delivered better by having a one-stop shop, however, it can also be reassuring and lower risk to have balancing, consulting opinion in the mix. Ongoing maintenance contracts may well be better served this way, providing redundancy is built in and the right SLAs are in place."

Case Studies

Modular system for Vente-Privee.com
Vente-Privee.com, the French online designer brand retailer, has invested more than 10m euros in a 30,000 sq m distribution centre near Lyon using an automated system from Savoye.

"A sale is processed in four days," says Sebastien Hospital, logistics director at Vente-Privee. "The success of any e-business operation relies in its logistics. We demand optimal preparation and delivery quality."

The Saint-Vulbas site has three 10,000 sq m cells. Savoye worked with Vente-Privee to design a modular, upgradeable system able to process all types and size of product.

The system relies on the LMS software package. The facility uses more than 3km of conveyors, multiple picking stations, a high rate line with manifolds which handles a flow rate of 50 boxes/minute. Savoye's Jivaro lidding machines are also used to automatically adapt the box's height to the content, for improved product stability and transport optimisation.

The system has been implemented in each of the cells and can be increased with three or four picking station loops depending on the growth in sales or be adapted to suit smaller sized cells.

"Our aim is to be able to duplicate this model at other sites in Europe, to set up in a country using our own technical and computing resources."

More than 20,000 orders, with over 3.5 items per box, are already processed at the site daily. When operating at full capacity, the site should dispatch around 40,000 boxes a day.

Automation on the agenda at CeMat
New developments in automated equipment are always a highlight at materials handling shows and SSI Schaefer is launching two new systems at CeMat this year.

The Auto Cruiser Conveyor is a fulfilment and order picking concept, while the Order Verifier is designed for auto checking of order-picking jobs.

The company describes the Auto Cruiser Conveyor as a new transport system that closes the gap between forklift transport and conveyor technology for internal deliveries - interconnected workstations will demonstrate the combined benefit of new technology with flexible pick at work assembly systems.

The Order Verifier job control system is able to count and identify the articles of over 1,000 items an hour completely automated.

SSI Schaefer is also highlighting the Schaefer Robo-Pick and the Schaefer Mini-Load Crane within the order-picking area.

Knapp is using CeMAT to reveal its new concept of free-roaming shuttles - an addition to its OSR Shuttle range.

It is expanding its All-in-Shuttle with the addition of free-roaming shuttles. Transporting loads without the need for rails, the free-roaming shuttle can exit the storage aisles to supply workstations directly. Knapp reckons that with further product development, this new breed of shuttle has the potential to make fixed conveyor systems a thing of the past.

Dematic is also showing the new Flex Multishuttle which allows different sizes of reusable containers and cartons to be handled on a system without having to transfer them onto trays. It will also have the Rapid Pick - a new type of high-performance station for small parts order picking using the goods-to-person principle.

Tesco opts for best
Within e-commerce many companies are combining a manual pick system with shipping sorters, packing lines or consolidation buffers.

When Tesco started developing its dedicated dot-com grocery centres, it chose a material handling system to handle the order consolidation process and the release and sortation of the consolidated orders to the delivery vans.

The retailer chose Vanderlande for its first site at Aylesford in Kent. Pickers pick product from shelving into plastic customer order crates held on trolleys. A picker can pick up to six customer orders simultaneously, spread across van routes. Completed orders are brought to a manually loaded infeed line, which takes the crates to a consolidation buffer. The consolidation buffer is based on a three-aisle Quickstore HDS ASRS system. The HDS will release crates to be sorted and loaded in reverse drop sequence to delivery vans.

The site has freed up expensive retail sales space in existing stores and enabled faster growth of dot-com sales. Other benefits include improved accuracy, traceability and a reduction in product damage.

Conveyor system boosts production
CI Logistics has automated the movement of products for Hodgson Sealants enabling the company to achieve up to a ten per cent increase in production at its Lymington site.

A continuous conveyor system transports boxes of butyl sealant products from the first floor of the site to the palletising and dispatch area on the ground floor.

The palletised raw butyl sealant arrives by lift onto the upstairs extruder floor, ready prepared for the extrusion process. This raw product is fed to the production lines where each operator can produce between 50 to 120 boxes of extruded product per shift.

All extrusion lines are connected by spurs to the main conveyor system. Double lift up gates have been incorporated into a number of these conveyor spur sections to allow access with a pallet truck. As operators fill boxes with finished product, they now push them onto the conveyor system instead of placing them on pallets.

Transport of boxes to the ground floor is via one of two conveyor routes: one runs above the main gangway; the other emerges from the extruder floor close to the decline section where the two routes merge.

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