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Supply Chain News: Leading Analysts are Bullish on Use of Mobile Robots in Distribution Part 2


This Week: Observations from John Santagate of IDC

March 4, 2019
SCDigest Editorial Staff

Last week, we ran an article on the bullish views on the use of autonomous mobile robots in distribution from Dwight Klappich, a vice president of research at Gartner.

In that article, we cited Klappich's recently published prediction that by 2023, over 30% of operational warehouse workers will be supplemented, but not replaced, by collaborative robots.

Supply Chain Digest Says...

So perhaps the two leading analysts looking at the distribution sector agree mobile robots can add a lot of value and will soon be deployed widely.

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He further noted that "Next-generation AMRs are already transforming warehouse operations, as these truly become more autonomous and intelligent," adding that mobile robot costs and complexities are coming down, which opens the market to more companies to test and adopt robot technology in the DC.

Klappich isn't the only analyst bullish on robots.

John Santagate, who now runs a research service for analyst firm IDC specifically on "service robots," sees a bright future for mobile robots in distribution.

His prediction is that by 2020, "65% of ecommerce operations will make use of autonomous mobile robots within their order fulfillment processes, thus helping increase productivity by over 100%."

100% improvement – that's a big number.

Santagate starts by noting that "Traditional approaches to order fulfillment involve a significant amount of non-value-adding movement."

Typically, he says, a human worker in the fulfillment center takes a picking task, pushes a cart throughout the facility, fills the cart with items on the order, and finally pushes the cart back to the packing area, where the cart is left with an order packer who prepares the order for shipping.

The picker then takes another order and goes through the process again.

"During this process, there is a lot of walking from point to point and oftentimes a disconnection between the products that are in a picker's cart and the inventory management systems," Santagate says. "In addition, when there are seasonal spikes in demand on the fulfillment center, the facility is burdened with bringing in an abundance of temporary labor to meet short spikes in demand."

These two examples, he says, illustrate a few of the key drivers of adoption of autonomous mobile robots in the ecommerce fulfillment process.

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Santagate says that there are now a large number of robot providers that hope to address these opportunities for distribution improvement.

As we noted last week, in 2012 Amazon acquired Kiva Systems – maker of orange robots that largely ushered in the "goods to picker" concept now manifested in several different forms of automation - for the princely sum of $775 million. Amazon then promptly took the Kiva robots off the market and used them only for its own internal fulfillment center needs.

Since then, "an entire market has emerged and rapidly evolved that is enabling ecommerce fulfilment center operations to automate the movement of orders throughout fulfillment centers," Santagate observes.

He adds that "The vendors in this space are enabling ecommerce fulfilment centers to deploy flexible automation that is scalable, flexible, easy to use, and cost effective."

Santagate says that we should recognize that autonomous mobile robots in the fulfillment center are connected mobile devices. As a result, in addition to taking on material movement, "the robots also become a "connected asset" that can be integrated into the business systems and become a valuable part of the IoT and digital transformation strategy of the ecommerce fulfillment center."

What's more, companies looking to battle the Amazon juggernaut will increasingly see autonomous mobile robots as key tools "to optimize operational performance and provide a high level of scalability and flexibility that will enable ecommerce organizations to better meet the needs of the market and increase their ability to remain competitive in this fast-growing and hypercompetitive environment," Santagate says.

In terms of advice, Santagate and Klappich agree that companies should be positive and proactive in terms of communicating with current workers.

"Communicate openly with workers; this is imperative," Santagate advises. "They must understand that the deployment of this technology is meant to augment their capabilities and open up new opportunities and that it is not a replacement for human labor in the ecommerce fulfillment center."

So perhaps the two leading analysts looking at the distribution sector agree mobile robots can add a lot of value, will soon be deployed widely, and are not much of a threat to existing DC associates.

For now, at least.

Are you equallly bullish on mobile robots in the DC? Why or why not? Let us know your thoughts at the Feedback section below.




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