With the labour shortage hot on the heels of the logistics industry, will automation intercept to save the day? Alexandra Leonards explores its place in logistics, how it is managed in the sector and some of the new technologies hitting the market…
The skills and labour shortage is growing at a worrying rate – amplified by the UK’s decision to leave the European Union. It is a real threat to the logistics industry as it stands.
Automation has been flagged as one of the potential solutions to this pressing issue. But will it be the cape-wearing hero, ready to pick up the slack left by shortages of staff, and save the industry?
According to Cimcorp’s Jarno Honkanen, automation will undoubtedly have an impact on how we deal with the skills shortage in the future.
“The skills shortage in logistics is being felt in many parts of Europe but the effects in the UK have been heightened by uncertainty over Brexit,” says Honkanen. “Even ahead of the final decision on the free movement of labour, the uncertainty has led some migrant workers to return home, increasing labour scarcity in UK warehouses.
“Of course, skill shortages lead to higher wages and this is increasingly tipping the balance in favour of automation in ROI calculations.”
Mike Chadwick, supply chain consultant at Indigo Software, even goes as far as to say that automation has to be the answer to the problem.
“Realistically automation has to be the solution because the skills shortage could ultimately drive up labour costs and the only way companies can get the certainty they require is to rely as little as possible on labour and invest in automation,” says Chadwick. “However it is essential to understand precise requirements over the long term and ensure investments are targeted accordingly.”
He says that otherwise companies could end up in a similar situation to a few years ago, where they invested in software that was over-specified and far too advanced for their requirements. “This results in the functionality not being used and the software being deemed too complicated,” he says.
Peoplevox’s founder and CEO, Jonathan Bellwood, says that in the e-commerce retail warehouse environment, there isn’t a skills shortage. “Unskilled people can be recruited, trained and empowered by giving them fit for purpose, easy to use warehouse management systems,” he says.
Picking is still not automated as the human touch is irreplaceable, he says, especially for less common or smaller items like those which come in multiple sizes and colours and may be stored in an illogical way.
Alex Harvey, head of autonomous systems and robotics at Ocado Technology, says that the company thinks that people still have an important role to play at its warehouses.
“ Automation can be used to help offset a labour shortage for physically-demanding tasks within classic warehousing,” says Harvey. “Once automation takes care of those menial tasks, human workers can be upskilled to perform more fulfilling and interesting work.
“Although people are often surprised about the complexity of the systems we are building, if we are going to build automated warehouses at an accelerated rate (both for ourselves and our OSP customers) then it does make sense to evolve technology to help run and maintain them and one day to even automate their construction in the first place.”
James Sharples, managing director at Swisslog UK, says that it’s no surprise that as retailers and other warehouse operations struggle to recruit a skilled workforce, they are turning to technology and robotics to help cope with demand.
“ While the wider belief is that warehouse automation means removing human interaction, Swisslog’s AutoPiQ solution is based on a shared picking principle: the robot picks the items that it is able to pick – which can be up to 95 per cent of the customer’s product range – and a worker finishes the order,” says Sharples. “Advancement in automation also comes with new employment opportunities. Machines are ready to work 24/7; supporting considerable volume increases and improved utilisation.
“These effects ultimately lead to increased delivery speed, improved delivery reliability, greater flexibility and higher customer satisfaction. All these things bring about greater efficiency in logistics, driving the creation of new roles and alternative jobs, such as in systems programming and support.”
Bryan Knott, senior global product manager mobile automation COE at Dematic, says that the technology will help not just a skills shortage, but an overall labour shortage. “ Warehouses and distribution centres simply can’t find enough labour to do the work,” says Knott. “That’s where automation comes in.”
There are a whole range of new automation technologies and strategies being introduced into the market.
“As we’ve built the systems that power the Ocado Smart Platform (OSP), we’ve often discovered that we had to invent many of the software and hardware needed for it simply because there was nothing on the market that suited our needs,” says Ocado’s Alex Harvey. “For example, we’ve developed a new wireless control system for the robotic swarm based on the 4G standard.
“The technology enables us to control and co-ordinate the movements of thousands of robots in real time and in parallel. It also means that Ocado’s second generation OSP warehouse is home to the most densely packed mobile network in the world.”
The retailer is also working in partnership with European universities on two Horizon 2020 funded research projects.
“ SoMa explores a new avenue of robotic manipulation, exploiting the physical constraints imposed by the environment to enable robust grasping and manipulation in dynamic, open, and highly variable contexts,” he says. “We’ve already demonstrated the progress we’ve made earlier this year and hope to have more to show in the near future.”
The other project is SecondHands, coordinated by Ocado Technology, which involves building a humanoid maintenance robot. Instead of being taught what to do, these robots learn by observing human engineers at work, and discover how they can help them with their tasks.
“The next step in the automation market is turning big data into smart data,” says Swisslog’s James Sharples. “Our cloud-based warehouse management software, SynQ, collects big data from the facilities it operates in, but what we are really excited about is using this data to allow logistics managers to run through “what-if” scenarios to better anticipate changes in demand or precisely determine the impact of new equipment on material flow.
“This concept is being called ‘virtualisation’.
“Virtualisation holds a wide range of capabilities for warehouse operations, but a favourite SynQ functionality among Swisslog customers is the award-winning Condition Monitoring,” adds Sharples. “This tool uses real-time data from material handling equipment to identify equipment wear before it becomes noticeable in operations, enabling warehouse staff to accurately predict when maintenance is required to prevent failure.”
Ocado’s Alex Harvey says that artificial intelligence remains one of the most exciting fields of technology, and that it would bring a huge boost to the automation market.
“ When it comes to disruptive technologies, AI really is in a league of its own – it’s the “one to rule them all”,” he says. “There are many, many applications of AI-powered automation across our end-to-end e-commerce, fulfilment and logistics platform.
“AI can be used in our warehouses to predict failures, to help with the investigations of problems, or to optimise the system’s parameters.”
But the new technology that has really grabbed the attention of the industry is robotics. “Robotics is now the buzzword in logistics automation,” says Honkanen, with cobots and six-axis picking robots being the focus of much attention.
“At Cimcorp, we are focused on gantry robots and this simple yet super-efficient technology has yet to be fully exploited in distribution centres. With goods accessed by robots from above, there is no need for racking, space-wasting aisles or sprinkler systems. Unlike the systems with robot cars roaming on top of the storage grid, there is no need to dig down through unwanted totes to get to the goods you want – instead, every tote is instantly accessible.”
He says that there is no doubt that robotic technologies will play an increasingly important role in supply chains over the next few years.
“ Developments in robotics – such as improved energy efficiency through lower weight, regenerative braking and software advances – are constantly enhancing ROI,” he says. “We’ve had a lot of interest from the retail, food service and e-commerce sectors for our Cimcorp 3D Shuttle robotic goods-to-man picking solution.”
Indigo’s Mike Chadwick agrees that the most commonly encountered trend is a migration from goods-to-person picking to using robotic picking systems.
“Prices are be slowly decreasing as the technology lifecycle starts to mature and this affordability means more companies are choosing to adopt what is already available,” says Chadwick.
Ocado’s Alex Harvey says that robotics has a very important role to play in the future of grocery retail.
“The fulfilment operation that we have at Ocado has changed dramatically since we first started more than 15 years ago,” says Harvey. “However, the vision from the beginning was to make use of automation and robotics.
“We have been a pioneer in this area for more than a decade and have seen several benefits when it comes to the logistics process: reduced waste, superior accuracy, improved quality. The Ocado Smart Platform robotic system is a game changer in terms of warehouse automation. Its parallelism provides resiliency and shorter pick times, cost effectiveness and better flexibility as business needs change.”
Peoplevox’s Jonathan Bellwood thinks that robots are a natural extension and evolution of automation. “The arrival of software robots is a major development,” he said. “They have the potential to remove human error from the warehouse workplace as well as do certain tasks more efficiently.”
He says that packing is a good example of where this kind of technology is already at work on conveyors that decide which carrier receives which package.
“For example, push parcel left for Royal Mail, right for DPD,” he adds. “They can also decide and deliver to the pack bench which size/type packaging is correct for a particular item or items, and seal the parcel.”
Swisslog’s James Sharples says that in the past, robotics has had a focus on processing small orders, which is ideal for certain sectors like pharmaceuticals, spare parts and e-commerce, but that this has often left physical retailers behind. “Swisslog is now addressing the many challenges retailers are facing, such as reducing costs and the daily workload of employees, in the form of a system that provides fully automated order picking of mixed case pallets,” he says. “ACPaQ combines best-in-class KUKA robotics and Swisslog‘s long-term experience in building logistics solutions.
“Order picking by robots improves picking quality and quantity, providing increased efficiency throughout the operation. The modular design allows growing companies to increase their capacity and efficiently handle peak demands, making the retail logistics process a simpler, less laborious task.”
How do you manage automation?
Every automated warehouse relies on a combination of hardware and software, and, says Cimcorp’s Jarno Honkanen:
“Both elements have to be efficient and robust for the solution to be optimal,” he says. “Of course, how easy a warehouse is to manage depends on how well it has been designed.
“What must not be overlooked at the design stage is the ease of accommodating additional SKUs and extra volume as the customer’s business evolves.”
Indigo’s Mike Chadwick believes that automation is great for planning because once a process is automated, it then becomes possible to predict exactly how long it will take and therefore the quality can become more controllable.
“Since practically all companies will be reliant upon other stakeholders within their supply chains, it’s essential to ensure that when automation is introduced, it has some flexibility built into it and can perform more than one function,” he says. “So for example, if you have a fully automated retrieval and put-away system and the communication stops for whatever reason, how can a manual work-around be introduced with a switch back to having operators?”
Ocado is aiming to operate its highly-automated customer fulfilment centres with as little human intervention as possible. They have achieved this by building intelligent systems.
“These systems use a combination of control theory and machine learning to manage the underlying complexities and to handle exceptions,” says Alex Harvey, Ocado. “However, for those occasions when human interventions necessary, we have created several levels of live management information.
“When you build systems at the scale we’re building them, it is critical you have the right information at the right time to respond in the right way.”
He says that to help its engineering operations teams, the retailer has built custom systems that provide instant machine feedback on how all the elements are physically performing, as well as live management reporting to measure performance against requirements.
“ The Ocado Technology division has also created live visualisation tools so we can review visually the live state of the CFCs from anywhere in the world,” he adds. “ This really helps when investigate and solve issues quickly as you can rewind to watch any problem unfold.
“Finally, these same systems help us simulate and plan the construction of future warehouses or quickly estimate any changes we want to make to the warehouse’s architecture. Learning how to design and build bespoke simulation, reporting and visualisation solutions has been critical to growing the Ocado business.”
Jonathon Bellwood thinks that simplification is the key to successfully managing warehouse automation. “If automated systems are set up correctly both permanent and temporary warehouse operatives will be able to quickly understand them,” he says.
Swisslog’s James Sharples says that a strong and adaptable warehouse management system is fundamental in the smooth running of an automated warehouse.
Bryan Knott at Dematic says that the systems in an automated warehouse allow you to ‘manage by exception’. “So the focus only needs to be on what isn’t working, not on what is,” says Knott.