John Johnson joined the DC Velocity team in March 2004. A veteran business journalist, John has over a dozen years of experience covering the supply chain field, including time as chief editor of Warehousing Management. In addition, he has covered the venture capital community and previously was a sports reporter covering professional and collegiate sports in the Boston area. John served as senior editor and chief editor of DC Velocity until April 2008.
When Walgreens began its search for a DC site in the Southeast, all signs initially pointed to Atlanta. But when the dust settled, the drugstore giant had chosen a 110-acre parcel in Anderson, S.C., a community less than one-tenth Atlanta's size and more than 100 miles away.
When its original plans to build in Atlanta didn't pan out (Walgreens was unable to find a suitable plot of land), the company was compelled to expand its search to communities within a 125-mile radius of the city. From a geographic perspective, Anderson, which is tucked away in the northwest corner of South Carolina, might not have seemed the most obvious choice. But Anderson promised something competing locations couldn't: a steady supply of workers with disabilities.
Before embarking on its site search, Walgreens had made a commitment to hire as many disabled workers as possible at the new facility. As it went through the usual site-selection steps, such as soliciting grants and tax incentives, it also considered which communities offered a large enough labor pool of disabled workers and the support services that would be needed to help them succeed. Talks with community groups convinced it that Anderson could meet its labor demands and would come through with the necessary resources and support. "We met with local agencies, and we said we were going to hire 600 people and that 200 will likely have severe disabilities," says Randy Lewis, the company's senior vice president of distribution and logistics. "Though nobody had ever done anything on this scale, [the Anderson community] responded very well and they really believed us. They circled the wagons and said they would work with us, and they've been very true to their word."
Once Walgreens' management had signed off on the plan, the Anderson County Disabilities and Special Needs Board and the South Carolina Vocational Rehabilitation Department began working with Walgreens to develop training programs for people with special needs. The agencies built a training center, which Walgreens outfitted with equipment that would be used in the DC.
Anderson also contributed trainers and even arranged for transportation to get disabled workers to and from the DC. "We wanted a sustainable model, and part of our model was not running a transportation system, so the community stepped up on that," says Lewis. "We told them we'd build the distribution facility and provide jobs and some training, but that their community needed to step up. They have done that. In retrospect, [choosing to build in Anderson] is one of the great decisions we've made."
The $175 million, 700,000-squarefoot facility, which opened in June, currently employs 335 workers, 47 percent of whom have a physical or cognitive disability like autism or mental retardation. For many of them, these jobs represent the first opportunity to bring home a paycheck. The company plans to expand the workforce to nearly 600 within the next few years. At full capacity, the facility will ship approximately 80,000 cases daily to more than 700 Walgreens stores in the Southeast.
Although Walgreens' program for hiring disabled workers has been featured in The New York Times, The Wall Street Journal, and on network television, Randy Lewis, Walgreens' senior vice president of distribution and logistics, makes it clear that the company isn't in it for the publicity.
"This is not cheering, guys," he says. "We'd be glad to share what we've learned about this from the human resources side with anybody. A lot of people have taught us a lot of things, and we'll be glad to share what we learned."
Lewis, who is leading Walgreens' drive to hire 1,000 disabled workers at its DCs over the next three years, has a personal story to tell. Austin Lewis, his 19-year-old son, is autistic. Lewis notes that 95 percent of autistic people never find work, and that the unemployment rate for those with other severe disabilities approaches 75 percent.
"Employment opportunities are very limited," he says. "I'm very interested in talking to my peers out there who want to do something like this. It's not as hard as they think, and it makes a big difference. When you read the letters I get from parents, you realize that a crumb from our table is a feast for these parents. The thing is, it was so easy that it makes you ask 'Why did I wait so long?'"
A personal stake
Walgreens' innovative hiring program grew out of a plan devised by Lewis, who oversees all of the company's distribution centers across the country. For him, the quest to create more employment opportunities for people with disabilities is personal. He has a 19-year-old son who is autistic and is keenly aware of the employment challenges facing disabled people.
The plan began to take shape in 2004, when Lewis was investigating technology for the DCs the company would be building in the next five years. "Our typical approach to technology and automation is to make [each generation] of DCs more efficient [than the last]," says Lewis. When he realized the extent to which advanced technology could reduce demands on the workforce, he began brainstorming with colleagues about possible opportunities for people with physical or mental challenges. "We decided to look into what we would need to tweak so we could employ a group of people who might otherwise not be able to work," he says.
When he approached the Walgreens board of directors with the idea, the directors were quick to offer support for the plan. "I said that we're building a new [center] that will be 20 percent more efficient, and by the way, one-third of the employees will be people with disabilities, and they said 'great,'" says Lewis. "The only thing they've said since then is 'thank you.'"
The company now has even more aggressive plans to hire disabled workers. Walgreens intends to adopt a similar workforce strategy at a DC it's building in Windsor, Conn., that will open in 2009. By 2010, the company hopes to employ 1,000 disabled workers at its 15 distribution facilities nationwide.
Though he acknowledges that 1,000 workers is an ambitious goal, Lewis believes it's attainable. "We needed a number that was achievable but tough enough to ring a bell," he says."We looked around at all of our other distribution centers, and decided on 1,000. It's a big number, but three years is far enough out there, but also close enough that it keeps some heat on us." He adds that Walgreens hopes to have 3,000 disabled people on the payroll by 2015.
Equal opportunities
The Anderson DC's workforce includes people with a wide range of disabilities, including autism, cerebral palsy, and Down syndrome. "It's the most interesting crowd you've ever seen. We've got every kind of walk you can imagine," Lewis says, with total empathy. "It is our most interesting place, and it's just an overwhelming experience to visit the facility."
Many of the disabled workers at the Anderson DC started out by attending pre-hire training, spending as much as a year and a half at the training center—without pay— learning the skills they'd need to qualify for a job. Though training does not guarantee a job, trainees who do well are eligible for a paid tryout at the DC. During the transitional phase, employees are accompanied by a job coach who assists with on-the-job training. At the end of the 45-day trial period, Walgreens reviews performance—including productivity and accuracy rates—and decides whether or not to offer the worker a job.
Walgreens has taken a number of steps to accommodate its disabled workers. For example, it has installed wheelchair ramps and redesigned work stations to be more ergonomically friendly for people with physical challenges. As part of that process, it replaced traditional computer keyboards with touch-screen monitors with large icons. It also uses pictures where possible to accommodate those with visual and other impairments. Instead of relying on traditional signage to remind workers to have their bags inspected, Walgreens uses a video of someone opening a bag. In addition, the company convinced vendors to include more information in bar codes on merchandise to cut down on the amount of data employees would have to enter.
Lewis reports that adapting the equipment to employees' needs turned out to be a relatively simple matter. "When it really came down to it, the selection of the technology didn't make that much of a difference," he says. "The biggest thing from a technology point of view was that it got us thinking about how people interact with our IT systems."
The jobs at Anderson aren't limited to production jobs on the DC floor. Today, disabled workers can be found throughout the distribution center, working in receiving, de-trash (where cartons are unpacked), full-case picking, split-case picking, and shipping. They also drive forklifts and the scrubbers used to clean floors. It's not unusual for disabled workers to be assigned to train typically-abled employees, as the disability community refers to workers without a handicap.
Disabled employees can be found in the management ranks as well, from managers with missing limbs to people like Angie Campbell, the facility's outreach manager, who has cerebral palsy (see box below). Campbell graduated from her master's degree program with a 4.0 grade average, sent out 300 resumes, and had 40 interviews. Even so, she didn't receive a single job offer until Walgreens finally gave her an opportunity.
Real work for real pay
When he talks about the center's hiring program, Lewis stresses that Walgreens is running a business, not a charity. The company holds employees with disabilities to the same performance standards as all team members, he says, and it offers them the same pay and benefits as other employees for the same work. "We said we want them to perform at the same level, at the same standard, side by side with other workers at the same pay.We said we want the DC to be an integrated work environment," he says, "and that's what this turned out to be."
In fact, Lewis reports that the Anderson DC is about 20 percent more productive than any of the corporation's other facilities. Although some of that can be attributed to the automated equipment that was installed to allow disabled people to perform the jobs, Lewis emphasizes that motivation plays a big part as well. The disabled workers are very concerned about performing at the highest levels possible, he says, noting that they constantly check their performance against the DC's productivity goals.
Like productivity, morale appears to be unusually high at the Anderson DC. "We've had managers intentionally transfer there or join us because of its mission," Lewis reports. "When I walk through the building, the typically-abled come up to me and say 'This is the best place I've ever worked.' Everybody focuses on two words what you can do, not what you cannot do. It's the building with the best attitude, the best spirit, and the most cooperation. I wish every building was like that."
The day when all buildings are like that may never come. But if Walgreens keeps its word, there might be a lot more of them in the not-so-distant future.
faces in the crowd at Walgreens' Anderson, S.C., DC
Angie Campbell, Career Outreach Coordinator
Disability: Cerebral palsy
Angie Campbell has a master's degree from Clemson University. Her job encompasses a little bit of everything, including coordinating the job referrals Walgreens receives from local disability agencies and supervising the agencies to make sure they're conforming to Walgreens' culture.
Best thing about working at Walgreens' DC:
"It's almost like I have an opportunity to create jobs for others with disabilities. When somebody comes to work here, I'm able to stay with them and ensure that they are successful."
How working here has changed my life:
"Professionally, it's made me have a broader skill level. Walgreens has let me try new things, and most of the things we've done have been successful. It's really a thrill. I can help the disabled community more than I could in my previous job. I know through my own struggles what somebody needs to be successful."
Harrison Mullinax, Receiving
Disability: Autism
Harrison Mullinax is working his first full-time job at Walgreens. The 18-year-old uses a hand scanner to check in items as they arrive at the DC. He says he probably wouldn't have a job if it were not for Walgreens. He spent 18 months volunteering in a training program to prepare for his position.
Best thing about working at Walgreens' DC:
"Being able to see different people and meeting new people that I've never seen before."
How working here has changed my life:
"It's changed my life a lot. There are good benefits here with the company and you get paid pretty good here."
Desiree Neff, Receiving
Disability: Myotonia congenita (a neuromuscular disorder)
Desiree Neff works in the receiving department scanning pallets as they come in the receiving doors. A former human resources manager for a retailer, she has worked at the DC for four months. She has already been involved in training and aspires to do more of that in the future.
Best thing about working at Walgreens' DC:
"It's a very safe and warm atmosphere where you can come to work and be yourself without having to try to hide your disability."
How working here has changed my life:
"I used to dread my old job. I was constantly threatened that if I didn't meet expectations, I would lose my job. But I look forward to coming to work here in this environment every day."
Julia Turner, Receiving (case check-in)
Disability: Down Syndrome
Julia Turner spent 12 months at the voluntary training program before being hired for her first full-time job ever at age 52. She has been involved in training some new managers at the DC as well as new workers in receiving. She'd like to be more involved in training in the future.
Best thing about working at Walgreens' DC:
"This is the best place to work. It's one of the greatest places I've ever been."
How working here has changed my life:
"This is the kind of job I've always wanted. By working, it keeps my mind occupied, instead of sitting around at home with nothing to do. I'd like to help other team members who aren't able to do something for themselves. This is what I've always wanted."
Progress in generative AI (GenAI) is poised to impact business procurement processes through advancements in three areas—agentic reasoning, multimodality, and AI agents—according to Gartner Inc.
Those functions will redefine how procurement operates and significantly impact the agendas of chief procurement officers (CPOs). And 72% of procurement leaders are already prioritizing the integration of GenAI into their strategies, thus highlighting the recognition of its potential to drive significant improvements in efficiency and effectiveness, Gartner found in a survey conducted in July, 2024, with 258 global respondents.
Gartner defined the new functions as follows:
Agentic reasoning in GenAI allows for advanced decision-making processes that mimic human-like cognition. This capability will enable procurement functions to leverage GenAI to analyze complex scenarios and make informed decisions with greater accuracy and speed.
Multimodality refers to the ability of GenAI to process and integrate multiple forms of data, such as text, images, and audio. This will make GenAI more intuitively consumable to users and enhance procurement's ability to gather and analyze diverse information sources, leading to more comprehensive insights and better-informed strategies.
AI agents are autonomous systems that can perform tasks and make decisions on behalf of human operators. In procurement, these agents will automate procurement tasks and activities, freeing up human resources to focus on strategic initiatives, complex problem-solving and edge cases.
As CPOs look to maximize the value of GenAI in procurement, the study recommended three starting points: double down on data governance, develop and incorporate privacy standards into contracts, and increase procurement thresholds.
“These advancements will usher procurement into an era where the distance between ideas, insights, and actions will shorten rapidly,” Ryan Polk, senior director analyst in Gartner’s Supply Chain practice, said in a release. "Procurement leaders who build their foundation now through a focus on data quality, privacy and risk management have the potential to reap new levels of productivity and strategic value from the technology."
Businesses are cautiously optimistic as peak holiday shipping season draws near, with many anticipating year-over-year sales increases as they continue to battle challenging supply chain conditions.
That’s according to the DHL 2024 Peak Season Shipping Survey, released today by express shipping service provider DHL Express U.S. The company surveyed small and medium-sized enterprises (SMEs) to gauge their holiday business outlook compared to last year and found that a mix of optimism and “strategic caution” prevail ahead of this year’s peak.
Nearly half (48%) of the SMEs surveyed said they expect higher holiday sales compared to 2023, while 44% said they expect sales to remain on par with last year, and just 8% said they foresee a decline. Respondents said the main challenges to hitting those goals are supply chain problems (35%), inflation and fluctuating consumer demand (34%), staffing (16%), and inventory challenges (14%).
But respondents said they have strategies in place to tackle those issues. Many said they began preparing for holiday season earlier this year—with 45% saying they started planning in Q2 or earlier, up from 39% last year. Other strategies include expanding into international markets (35%) and leveraging holiday discounts (32%).
Sixty percent of respondents said they will prioritize personalized customer service as a way to enhance customer interactions and loyalty this year. Still others said they will invest in enhanced web and mobile experiences (23%) and eco-friendly practices (13%) to draw customers this holiday season.
That challenge is one of the reasons that fewer shoppers overall are satisfied with their shopping experiences lately, Lincolnshire, Illinois-based Zebra said in its “17th Annual Global Shopper Study.”th Annual Global Shopper Study.” While 85% of shoppers last year were satisfied with both the in-store and online experiences, only 81% in 2024 are satisfied with the in-store experience and just 79% with online shopping.
In response, most retailers (78%) say they are investing in technology tools that can help both frontline workers and those watching operations from behind the scenes to minimize theft and loss, Zebra said.
Just 38% of retailers currently use AI-based prescriptive analytics for loss prevention, but a much larger 50% say they plan to use it in the next 1-3 years. That was followed by self-checkout cameras and sensors (45%), computer vision (46%), and RFID tags and readers (42%) that are planned for use within the next three years, specifically for loss prevention.
Those strategies could help improve the brick and mortar shopping experience, since 78% of shoppers say it’s annoying when products are locked up or secured within cases. Adding to that frustration is that it’s hard to find an associate while shopping in stores these days, according to 70% of consumers. In response, some just walk out; one in five shoppers has left a store without getting what they needed because a retail associate wasn’t available to help, an increase over the past two years.
The survey also identified additional frustrations faced by retailers and associates:
challenges with offering easy options for click-and-collect or returns, despite high shopper demand for them
the struggle to confirm current inventory and pricing
lingering labor shortages and increasing loss incidents, even as shoppers return to stores
“Many retailers are laying the groundwork to build a modern store experience,” Matt Guiste, Global Retail Technology Strategist, Zebra Technologies, said in a release. “They are investing in mobile and intelligent automation technologies to help inform operational decisions and enable associates to do the things that keep shoppers happy.”
The survey was administered online by Azure Knowledge Corporation and included 4,200 adult shoppers (age 18+), decision-makers, and associates, who replied to questions about the topics of shopper experience, device and technology usage, and delivery and fulfillment in store and online.
Supply chains are poised for accelerated adoption of mobile robots and drones as those technologies mature and companies focus on implementing artificial intelligence (AI) and automation across their logistics operations.
That’s according to data from Gartner’s Hype Cycle for Mobile Robots and Drones, released this week. The report shows that several mobile robotics technologies will mature over the next two to five years, and also identifies breakthrough and rising technologies set to have an impact further out.
Gartner’s Hype Cycle is a graphical depiction of a common pattern that arises with each new technology or innovation through five phases of maturity and adoption. Chief supply chain officers can use the research to find robotic solutions that meet their needs, according to Gartner.
Gartner, Inc.
The mobile robotic technologies set to mature over the next two to five years are: collaborative in-aisle picking robots, light-cargo delivery robots, autonomous mobile robots (AMRs) for transport, mobile robotic goods-to-person systems, and robotic cube storage systems.
“As organizations look to further improve logistic operations, support automation and augment humans in various jobs, supply chain leaders have turned to mobile robots to support their strategy,” Dwight Klappich, VP analyst and Gartner fellow with the Gartner Supply Chain practice, said in a statement announcing the findings. “Mobile robots are continuing to evolve, becoming more powerful and practical, thus paving the way for continued technology innovation.”
Technologies that are on the rise include autonomous data collection and inspection technologies, which are expected to deliver benefits over the next five to 10 years. These include solutions like indoor-flying drones, which utilize AI-enabled vision or RFID to help with time-consuming inventory management, inspection, and surveillance tasks. The technology can also alleviate safety concerns that arise in warehouses, such as workers counting inventory in hard-to-reach places.
“Automating labor-intensive tasks can provide notable benefits,” Klappich said. “With AI capabilities increasingly embedded in mobile robots and drones, the potential to function unaided and adapt to environments will make it possible to support a growing number of use cases.”
Humanoid robots—which resemble the human body in shape—are among the technologies in the breakthrough stage, meaning that they are expected to have a transformational effect on supply chains, but their mainstream adoption could take 10 years or more.
“For supply chains with high-volume and predictable processes, humanoid robots have the potential to enhance or supplement the supply chain workforce,” Klappich also said. “However, while the pace of innovation is encouraging, the industry is years away from general-purpose humanoid robots being used in more complex retail and industrial environments.”
An eight-year veteran of the Georgia company, Hakala will begin his new role on January 1, when the current CEO, Tero Peltomäki, will retire after a long and noteworthy career, continuing as a member of the board of directors, Cimcorp said.
According to Hakala, automation is an inevitable course in Cimcorp’s core sectors, and the company’s end-to-end capabilities will be crucial for clients’ success. In the past, both the tire and grocery retail industries have automated individual machines and parts of their operations. In recent years, automation has spread throughout the facilities, as companies want to be able to see their entire operation with one look, utilize analytics, optimize processes, and lead with data.
“Cimcorp has always grown by starting small in the new business segments. We’ve created one solution first, and as we’ve gained more knowledge of our clients’ challenges, we have been able to expand,” Hakala said in a release. “In every phase, we aim to bring our experience to the table and even challenge the client’s initial perspective. We are interested in what our client does and how it could be done better and more efficiently.”