December 3, 2019 Comments Off on Keeping Pace with Automation, Inside and Outside the Warehouse Views: 1250 National News

Keeping Pace with Automation, Inside and Outside the Warehouse

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By Paul Bubny

At Colliers International, Gregg Healy sees the changes that the advent of robotics and autonomous vehicles are bringing to the industrial sector, both in the warehouse and elsewhere in the supply chain. In this interview with Connect Media, Healy, who leads the Supply Chain & Logistics team at Colliers, provides a guide on what to expect and the timeframe for these advancements to come into play.

Q: Robotics already are playing an increasing role in warehouses as well as assembly plants. What are some of the potential applications for automated/autonomous vehicles in these settings—as well as in shipping/delivery logistics?

A: The shift to automation, both inside and outside of the warehouse, is happening quickly. Interestingly enough, it’s happening faster in China than it is in the United States. The Chinese continue to ramp up their investment in automation and technology to curb some of the strains that they have had with increasing labor costs which have decreased their manufacturing cost advantage.

In the United States — because of the shortage of labor, particularly in the peak seasons, as well as the increasing costs of labor — the shift to a greater application of autonomous robotics and vehicles is going to happen as quickly as legislation can keep up. In fact, Amazon — which currently has a fleet of 200,000 robots supercharging its fulfillment centers — has announced plans to one day, in the not so distant future, offer 30-minute deliveries — which to be clear would involve a massive fleet of robots and drones to achieve.

The implementation of autonomous vehicles within the warehouse is a function of trying to reduce the travel time for associates, increase the effective picking and conveying of parts and improve the reliability and planning of work. Autonomous vehicles inside the manufacturing or distribution center can eliminate highly redundant jobs and free up labor to perform higher skilled, and more varied tasks.

The push to autonomous, or at least enhanced semi-autonomous delivery, is heating up as the labor shortage in drivers specifically, has put pressure on the industry to either raise costs or have an innovation catalyst to fill the void. We see that happening in a myriad of different industries as they look to new methods to ship products.

Whether it be via drones, like we are already seeing with CVS and Walgreens — where they are beta-testing this technology prior to a potentially larger roll-out — or with the hospitality sector, where robots are more frequently being used to deliver items for room service calls. Autonomous delivery methods are starting to gain traction in the industry and their implementation will only continue to increase.

On the long-haul side, there are more than a handful of serious players that are working on ways to automate long-haul transportation, a potential first pass on the drive for more automated trucks.

With the advent of 5G wireless networks, the speed of wireless data will increase as much as 20 times that of 4G LTE initially, and even to greater speeds later. This is truly significant for the development of driverless vehicles as they need to capture as many data points of the salient world around them to understand how to navigate in it. I’ve read that just one driverless vehicle creates as much data as 3,000 people per day. Imagine the volume of data required to make driverless technology truly normalized. At first, as 5G becomes more common, we will see data collection from static points around a vehicle and progressing from there the capability to have true vehicle-to-vehicle communication.

Q: Assuming that a fair amount of the technology already exists to make these scenarios reality, what kind of time horizon are we looking at before these scenarios become commonplace?

A: The big hypothetical here is to assume that all of this technology exists, and moreover, that it is perfected. It clearly is not in place, nor perfected at this time, but it is getting better. The pace of adoption of driverless technology will vary by technology and the constraints placed upon that technology, but I believe the constraints will be primarily around perception by consumers and perhaps, more importantly, regulation and legal constraints.

Recently, I was in Arizona meeting with TuSimple, which is the world’s largest and most advanced self-driving truck company. While there, they were showcasing their technology around level 4 — classified as high automation — autonomous driving. They are already doing runs (that are fully monitored by drivers) with loads of products on fixed routes — as the precise mapping of these routes is vital. They are also now running shipments for customers, including well-known brands like UPS, which not only is a customer of TuSimple, but also decided to invest directly in the company. Like many of the big players in the distribution space, UPS recognizes the need to partner with driverless technology-related firms as it will play a more vital role in the industry going forward.

Q: Where are we likely to see automated/autonomous uses appearing first?

A: The first applications are those that have the lowest threshold for risk. In the warehouse, we already see autonomous forklifts, autonomous robotics picking and delivering parts, as well as automated storage and retrieval systems, among other technologies to convey product. We also have many dark warehouses that are pretty much fully automated as well, where automation can pick and pack product without human interaction. The question is, just how fast will the technology trickle down to more industries and additional sites? This is still yet unknown.

Beyond the four walls of the warehouse, from what I am hearing, we still have a few years to go before we truly adopt driverless technologies, and much of this relies upon the adoption of other technologies, namely 5G. But, no doubt, it is coming and faster than we initially thought it would.

At first, look for autonomous routes on long, easier routes — think cross-country deliveries or between major metropolitan markets. In the [perhaps not so distant?] future, I can envision something like a network of cross-dock facilities outside of large urban cores, where caravans of “rail on the road” trucks could stop and a human driven cab would deliver the last segment of the trip navigating the urban core.

Also, driverless vehicles can be initially utilized among areas where there is more of a controlled environment. Areas with less traffic or where overall variable factors are easier to develop this technology around. As the technology advances, the ability to navigate more complex scenarios will likewise develop in parallel.

Q: How are you and your colleagues advising clients to prepare?

A: The most important advice is to remain open minded and flexible to the changes that are coming. It is basically the Wild West right now with a lot of competing technology platforms out there. Which platform will succeed is still unknown — and there will definitely be consolidation in the market as to which companies rise to the top and which don’t survive at all. But this shift IS happening. The key forces that make automated delivery, both inside and outside the warehouse, necessary will continue to push for a more cost effective and more reliable mode to convey products.

As developers, we need to consider building the infrastructure at facilities to plan for this. For end users, be open and in front of the curve on what is out there because those that adopt the winning technologies will be successful.

To paraphrase Charles Darwin, “It’s not always the strongest or smartest who succeeds, but the one who is the most adaptable to the changing world around them.” Keeping a keen focus of the demands of the customers, and then leveraging emerging technologies to support the creation of value for them is in my view the best way to create sustainable competitive advantage.

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For comments, questions or concerns, please contact Paul Bubny

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