James Cooke is a principal analyst with Nucleus Research in Boston, covering supply chain planning software. He was previously the editor of CSCMP?s Supply Chain Quarterly and a staff writer for DC Velocity.
For years, distribution consultants have labored to find ways to reduce travel time in the warehouse operation. Traditionally, that's meant designing distribution center layouts to minimize the distance order pickers had to walk to retrieve items from storage. Common sense dictates that the less time workers spend traveling, the more time they'll have for order picking and the more productive they'll be.
But there's another way to increase picking productivity. Instead of merely reducing travel distances, some companies are opting to eliminate travel time altogether. They're doing this by using automated material handling equipment to deliver items to order pickers who remain in a fixed spot. It's a concept dubbed "goods to person," and a number of material handling equipment manufacturers are touting it as a way to improve warehouse productivity.
Goods-to-person order picking isn't a new concept. Consultant John Hill of TranSystems says the idea has been around since the late 1960s under various names, including "goods to picker." But the concept is attracting renewed interest today as more distribution operations grapple with the challenges of picking individual items, or "eaches," instead of full cases or pallets.
As for the equipment used in goods-to-person picking systems, there are a number of options. For example, some companies use automated storage and retrieval systems (AS/RS) with shuttles to deliver goods to workers. In this type of application, the automated storage and retrieval system uses cranes and conveyance vehicles to remove pallets, totes, or bins from storage racks and deliver them to a station at the end of an aisle. Once the containers arrive at the station, a worker retrieves the items needed and deposits them into the appropriate boxes or totes to fill customers' orders. Automated storage and retrieval systems designed for goods-to-person picking are available from such well-known vendors as Dematic, HK Systems, Knapp Logistics and Automation, and Witron Integrated Logistics.
Another option is to use carousels in conjunction with automatic extractors. Under this approach, the carousel spins to where the desired container is stored and presents it to the automatic extractor. The extractor, which resembles an elevator, then pulls the container from the carousel and deposits it on a conveyor for transport to the pick station. One of the leading suppliers of this type of equipment is Schaefer Systems International.
Perhaps the newest variation on goods-to-person order picking involves the use of robots. With a robotic order fulfillment system, a robot carries products stored on portable shelves to an order picker. Kiva Systems is the best-known vendor of this type of technology.
No matter what type of equipment is used, computer intelligence remains critical to the successful deployment of goods-to-person picking. In fact, recent advances in software programming have taken the systems' ability to optimize the flow of items to a whole new level. Typically, this software functionality is contained in the warehouse control system (WCS), the same application that controls the automated equipment. "WCS software is the enabler that has allowed goods-to-person work stations to obtain ultra-high pick rates," explains Ken Ruehrdanz, who's a distribution and warehousing market manager at Dematic. "The WCS software allows the loads to be retrieved from the storage system and presented to the pick station in a precise sequence."
Although these systems tend to carry a high price tag, they can bring about substantial improvements in throughput. In a recently published white paper, Dematic claims that operations that adopt the goods-to-person approach can achieve pick rates of between 500 and 1,000 lines per hour. For distribution centers seeking to boost throughput in their piece picking operations, goods to person may provide just the kind of "pickup" in productivity they're looking for.
Editor's note: Dematic's white paper, "Goods to Person" Order Fulfillment, can be downloaded for free from DC Velocity's Web site. Go to https://www.dcvelocity.com/whitepapers/.
Specifically, the new global average robot density has reached a record 162 units per 10,000 employees in 2023, which is more than double the mark of 74 units measured seven years ago.
Broken into geographical regions, the European Union has a robot density of 219 units per 10,000 employees, an increase of 5.2%, with Germany, Sweden, Denmark and Slovenia in the global top ten. Next, North America’s robot density is 197 units per 10,000 employees – up 4.2%. And Asia has a robot density of 182 units per 10,000 persons employed in manufacturing - an increase of 7.6%. The economies of Korea, Singapore, mainland China and Japan are among the top ten most automated countries.
Broken into individual countries, the U.S. ranked in 10th place in 2023, with a robot density of 295 units. Higher up on the list, the top five are:
The Republic of Korea, with 1,012 robot units, showing a 5% increase on average each year since 2018 thanks to its strong electronics and automotive industries.
Singapore had 770 robot units, in part because it is a small country with a very low number of employees in the manufacturing industry, so it can reach a high robot density with a relatively small operational stock.
China took third place in 2023, surpassing Germany and Japan with a mark of 470 robot units as the nation has managed to double its robot density within four years.
Germany ranks fourth with 429 robot units for a 5% CAGR since 2018.
Japan is in fifth place with 419 robot units, showing growth of 7% on average each year from 2018 to 2023.
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.
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.”