Certain industry segments, and especially Ecommerce, experienced rapid growth globally during the past year, bringing with it increased reliance on warehouses to deliver goods quickly and reliably. At the same time, rising customer demand coupled with severe labor shortages have forced companies to focus on improving efficiency and optimizing processing times.
Companies are responding by investing in warehouse automation: The global warehouse automation market is set to increase at a compound annual growth rate (CAGR) of 13.6% from 2021-2025, reaching approximately $30.99 billion in 2025.
It’s no surprise since automating your warehouse enables you to grow and expand into new markets by increasing productivity, efficiency, safety and operational performance. Companies however often struggle to get the results they desire from the automation, mainly due to a lack of proper preparation as automation is a significant investment that needs careful planning – incorporating seven crucial steps.
Taking shortcuts could put your automation project in peril. But by embracing the following steps, your warehouse is more likely to run at peak efficiency, and you’ll be better able to maximize your technology return on investment (ROI).
1. Use correct data to design the right automated warehouse
Potential automation solutions are only as good as the data that goes into the design. How many SKUs, orders, pallets, and so forth do you currently have? Further, how is that going to develop in the next five or 10 years?
Saying “I want to grow 10% per year,” for example, isn’t specific enough. Figure out whether you aim to grow by being able to handle 10% more orders, process 10% more lines per order and/or increase the number of SKU with 10%. The more precise you can be with your design data, the better chance you’ll have at incorporating the right solutions into the warehouse design.
2. Choose the right partner
Designing and implementing the optimal automated warehouse involves carefully selecting the right partner(s) to do that. For the design phase, choose whether you want a consultant that provides analysis and design only or perhaps you want a system integrator that can implement the automation, too.
Be sure to check references and remember this step revolves around trust. You should feel confident knowing the provider you pick for your automation project can and will deliver the results you anticipate.
3. Select the right concept
Regardless of your desire to automate warehouse storage, transportation, picking or another area, several solutions exist. Avoid selecting a shiny new object without knowing whether it suits your specific needs. For example, goods transportation within a warehouse could include roller conveyors, rail guided vehicles (RGVs) or automated guided vehicles (AGVs) or combinations, depending on the required material flows.
Do you desire a higher investment with lower running costs – or is it the other way around? Can the automation you select meet your challenges, if, for instance, you deal with ecommerce and needs change unexpectedly? The provider you choose should be able to help you decide.
4. Don’t underestimate the importance of IT integration
(Sub)system orchestration – or lack thereof – can make or break an automation project. You can spend $1M or more on a particular solution, but if it is not synchronized with the other technology solutions in your warehouse, you aren’t set up for success. In other words, if solutions are siloed, you lack the ability to operate at full capacity.
Unfortunately, when you hear or read about a company’s automation failures, lack of IT integration is the most common culprit. By making sure all systems are fully integrated, your solutions should work well together, delivering the results you expect.
5. Plan properly for the entire project
Rather than waiting for everything, including new equipment and software, to be on site, test your system with emulators. By using emulators to test software before equipment is in the warehouse, you can smooth out kinks and avoid “hoping for the best” when the equipment arrives.
This step also includes coordinating multiple contractors who could potentially be on site at the same time, planning the transition from the old system to the new one and knowing when to switch off the system you’re about to sunset. Remember, during transition, you can’t go from zero to 100-miles-per-hour in a day.
6. Embrace change management – take care of your employees
Never underestimate the power of your people, and know that when you automate, you’ll likely need to mix up your staff. Say, for example, you have a warehouse operator with 25 years of experience who’s highly skilled at his or her job. Although that experience is invaluable, this seasoned worker might not embrace automation. By blending existing employees with newer hires who think analytically and embrace warehouse automation AND by training the existing employees for the new technology, you could get the best of both worlds and achieve the success you need.
7. Ensure support after going live
Going from a manual to an automated warehouse is a huge step and shouldn’t happen without having an experienced provider who will help. Think of it this way: You are going from driving a stick-shift Chevy to being behind the wheel of a powerful yet complicated Formula One race car. You will need support learning the intricacies, power and the benefits of new solutions and you will need to maintain the new car.
Embrace all 7 steps
Automated warehouse solutions provide numerous benefits that include running at peak efficiency. The seven-step process of going from manual to automated should be taken seriously. Embracing these crucial steps is key to ensuring the technology you invest in delivers the benefits you expect – and can make the difference in your new systems being either optimized or sitting idle.
Learn more about warehouse automation here.