Warehouse automation is everywhere these days. At Amazon and other online retailers, for instance, “pickers” work side-by-side with robots. (See related article “Warehouse Automation New Frontiers.”)
And with good reason. In many instances, warehouse automation has been shown to improve efficiency, speed, reliability, accuracy and (eventually) cost savings.
Is It Right for You?
But just because automation is so prevalent doesn’t mean it will solve every material-handling issue or be the right fit for your facility. Humans are still better at a lot of things. Indeed, even at Amazon — the mother of all robotic warehouses — machines are not quite ready to take over completely.
As you can see, the science of warehouse automation encompasses all kinds of methods to bring inventory directly to the worker, in order to minimize his or her movements within the facility. Some of the most popular systems are carousels, vertical lifts, automated storage and retrieval systems (AS/RS), mini-loads, and automated guided vehicles (AVGs). A separate category of automation includes conveyors that move and direct inventory to the next appropriate operation.
Case in point: A mid-sized industrial distributor made a $3 million investment in carousels linked with an active conveyor. Alas, the system’s performance and reliability were so poor that it was abandoned, at a significant loss to the company. But in hindsight, the owner realized that, even if the system had worked perfectly, it still would have been a really bad investment.
Why? Because even though the automation enabled him to cut his workforce in half (for a savings of $300,000 per year), the five-year return on his $3 million investment would still have been minus 19%.
Like all business decisions, the choice of whether to invest in automation boils down to a reasonable expectation of adequate ROI.