In the aftermath of pandemic era inventory and logistics challenges senior supply chain leaders are chartered to build resilience into their distribution networks and facilities. Automation’s contribution to operational continuity — through reduced dependence on scarce labor, consistent execution, and better inventory visibility has made it an essential consideration, especially for those companies in cold chain logistics.
Automated warehouse processes both increase safety and reduce dependence on human labor in distribution and manufacturing. Automation increases accuracy, speed, and productivity. Cold chain warehouses which operate some of the harshest environments for humans find automation especially beneficial.
Automation is a powerful solution for warehouses to improve efficiency and remain competitive, but not all automation is suitable for cold storage environments. And how do you know if your cold storage warehouse is ready for automation? Here’s a comprehensive checklist to help you evaluate your operations and determine when and where warehouse automation is right for your business.
Evaluate Your Current Operations with a Process Analysis
One of the first steps to determine if your warehouse is ready for automation is evaluating your current processes. What do your order volume and profiles look like? Look at picking, packing, and shipping workflows, especially those with manual processes which are not only dependent on labor, but also prone to errors and bottlenecks which impede efficiency and productivity. Consider all processes with substantial impact across operations to determine which areas would benefit most from automation.
Does your business regularly face stockouts, overstock situations, or inventory discrepancies? Automation can help with these issues by tracking inventory in real time and replenishing as needed. If you’re facing challenges with finding labor or increased labor costs, technology like Autonomous Mobile Robots (AMRs) and high density shuttle systems can help replace or re-allocate your labor effectively.
Target Growth and Expansion Needs
Warehouses struggling to keep up with significant changes in seasonal demand (peaks and valleys) and accelerated growth require automated systems to be highly scalable, with flexible designs to address fluctuating order volumes over time. Using automation, warehouses can significantly increase throughput, allowing warehouses to process more orders in less time and in the same footprint – delaying the need to expand the network or facility. Automation that keeps pace with demand can help you meet customer expectations, fulfill service level agreements, and build trust and a good reputation.
Examine Infrastructure and Technology Readiness
Not all warehouses are physically designed with automation in mind. Some automation equipment requires changes to the physical space to work properly, such as floor leveling, power requirements, and ceiling heigh constraints. Before investing in automation, consider the existing layout and physical requirements to accommodate larger systems like Automated Storage and Retrieval Systems (AS/RS) or AMRs. If you’re not sure which type equipment is appropriate for your facility and/or how to maximize the cube of the building using automation, consider speaking with a warehouse automation expert for a full workflow and warehouse assessment.
Evaluate the Technology Stack
Automation and robotic systems rely on real-time data from your inventory system of record. Warehouse management system (WMS) or enterprise resource planning (ERP) software should be checked for compatibility with controls software and warehouse execution systems (WES). If your legacy systems are outdated, incompatible, or non-existent, you may need to upgrade, modify, or implement changes to your technology stack before proceeding with robotic automation.
Be sure to understand and budget for software license, upgrade and implementation costs and build time into your implementation plan to execute software changes. Perhaps even more important than software licensing is understanding your daily support needs for both your software and your automation equipment post-implementation. Software and equipment companies often have vastly different terms for licensing and support options, and this can have a dramatic impact on budgets in both the short and long term.
The right automation provider will ideally have a flexible software platform with high integration capability and user-friendly interfaces. For more on the role of software, see The Critical Role of Software in Automated Pallet-Moving Systems for Cold Storage.
Cold Chain Customer Expectations
Retailers, restaurant chains, and hospital systems are increasingly requiring supply chain partners to demonstrate temperature integrity, traceability, and on-time performance at levels that are difficult to achieve without automation.
Examine the Business Case
Warehouse automation can involve both capital and/or operating expense components. It’s important to look broadly when examining the business case for investment. Consider not only the costs, including the cost of equipment, software, installation, ongoing maintenance, and employee training, but look at the value derived from enhanced capabilities and associated potential revenue lift as well as cost savings from accuracy, speed, and efficiency. Though the initial costs might seem steep, companies can often achieve payback (ROI) within a 3-year time frame and sometimes in as little as 18 months.
To confirm the business case and appropriate expectations for automation, consider starting with a pilot program to assess automation in a smaller part of the warehouse before undertaking a more comprehensive technology change. This also allows you to prove the assumptions and gives employees a chance to work with and embrace automation before making a larger investment in new technologies.
Assessing the Workforce and Change Management
Automation isn’t about replacing workers; it’s about optimizing worker efforts. Automating repetitive or demanding tasks frees workers for more valuable and fulfilling work in the warehouse, with greater critical thinking and problem-solving.
For automation to succeed, workers must be properly trained and their hesitations and expectations managed through robust change management efforts. Consider the readiness of your team to embrace new training and technologies. Clear communication and strong leadership are essential at this stage for employee adoption. Employee involvement during the transition process will also reduce resistance and foster collaboration within the workplace. The right automation provider will also assist with training staff and preparing employees to embrace new technologies.
Temperature and Moisture
Temperatures and humidity levels must be consistently maintained. To do so requires systems to allow for proper air circulation. Automation equipment that works well in ambient environments may lack the necessary hardiness to handle extreme temperatures and moisture. Vision systems are especially vulnerable to changes in temperature and humidity. Be sure you are collaborating with a partner who has experience with vision and navigation in cold chain environments.
Type of Inventory
Products often have different storage and handling requirements and business rules to prevent hazards and cross-contamination. Consider more than just the weight, size, crushability and type of goods your warehouse manages, but also look at how automation systems can accommodate your business requirements without damage to perishable goods or machinery. Consider cross-contamination risks and regulatory requirements for product expiry and recall.
Phased Implementation
To mitigate risk, automation is often best embraced in a phased approach. Agility is key when introducing automation. When robotic process automation projects fail, it is often because the approach is too rigid or the commitment too much at one time. Agile methodology combined with proof-of-concept iteration enables both rapid deployment and course correction.
Summary
Warehouse automation has the potential to transform operations for greater efficiency and accuracy. What about the cost of not automating your cold chain operations? Rising labor costs, increasing energy costs, growing competitive pressure from companies that have automated, and escalating regulatory requirements are driving more companies like yours to explore automation solutions.
Before selecting an automation partner and implementing automation technologies, consider the above outlined factors. To determine whether your cold chain operations are ready to embrace automation evaluate their operations, including processes, growth needs, technology infrastructure, and workforce.
Competitive Advantage for 3PLs
3PL operators face a distinct set of considerations:
multi-client environments, the need to demonstrate automation ROI to customers,
shorter-term contracts, service level obligations, and the competitive
differentiation that cold chain automation capability provides when winning new
business.
Contact us today to schedule your readiness assessment and determine how Prime’s cold storage robots and flexible workflow can transform your warehouse operations.
