In our continuing series of discussions with top supply-chain company executives, Stan Normand offers advice for starting an automation project and discusses the impacts that AI and machine learning will have on future robotic systems.
David Maloney has been a journalist for more than 35 years and is currently the group editorial director for DC Velocity and Supply Chain Quarterly magazines. In this role, he is responsible for the editorial content of both brands of Agile Business Media. Dave joined DC Velocity in April of 2004. Prior to that, he was a senior editor for Modern Materials Handling magazine. Dave also has extensive experience as a broadcast journalist. Before writing for supply chain publications, he was a journalist, television producer and director in Pittsburgh. Dave combines a background of reporting on logistics with his video production experience to bring new opportunities to DC Velocity readers, including web videos highlighting top distribution and logistics facilities, webcasts and other cross-media projects. He continues to live and work in the Pittsburgh area.
Stanislas Normand is managing director of Exotec North America, where he works to drive the adoption of the company’s warehouse robotics solutions in the North American market. During his time at Exotec, Normand has held multiple positions and played a key role in the company’s rapid international expansion. He holds a master's degree in economics and finance from École Polytechnique in France.
Q: Stan, how would you describe the current state of the material handling automation market?
A: Customer demand for everything from faster year-round shipping to consistent order accuracy is expected to continue to grow despite the long and ever-changing list of challenges warehouses are facing now and in the future.
We’re seeing that the main challenges confronting brands right now are labor shortages, pressure for cost reductions, and uncertainty:
Labor shortages: Despite supply chain challenges easing up, the availability of labor is still a huge issue.
Cost reduction: In this uncertain environment, customers are increasingly looking to reduce costs to shore up against macroeconomic fluctuations.
Uncertainty:Customers increasingly are looking for flexibility because they want to be reactive to changes in their business and external factors.
Supply chain disruptions and labor shortages aren’t going away anytime soon. Since companies can’t control these mounting challenges, it’s important to focus on the control you do have, and that’s finding a solution to combat them. Warehouse robotic solutions lead the fulfillment industry in delivering the optimal mix of performance and flexibility to ensure customer order expectations are met and exceeded.
Q: What are your hopes for Exotec in the North American market now that you have been appointed managing director?
A: With the increase in demand for warehouse automation, my team and I are focused on growing our NA presence and delivering solutions that create warehouses where people work smarter, not harder, through robotics.
In March 2023, we reached a milestone of 5,000 robots built in record time—just three months after hitting the 4,000-robots milestone. This achievement is representative of Exotec's rapidly growing manufacturing capabilities and the growing demand for Exotec’s products. We have already made significant strides in making warehouse jobs less physically demanding. Exotec robots have saved warehouse workers from having to walk more than 16 million miles.
In December 2022, we officially opened Exotec’s North American headquarters in Atlanta, which supports and facilitates our growing business in North America, which is expected to represent as much as 40% of Exotec’s global business by 2025. We’re focused on growing our company in the region, which includes a goal of doubling our headcount by 2024.
Q: Your background is in economics and finance. How are you able to leverage that experience in your current role?
A: A background in economics is an asset in any industry, but particularly for a position in sales and operations. It gives you a set of tools to understand the market’s mechanisms and the drivers behind its growth, and companies can leverage that knowledge to their benefit.
With the current post-pandemic supply chain disorganization, worldwide inflation, and labor shortages, being able to understand how, despite that uncertainty, we can still leverage those challenges as business opportunities for Exotec is important for leading our business in North America.
My five years of experience with Exotec across different roles has also allowed me to develop a strong technical understanding of our products and understand how our solutions can be impactful for our customers. This helps me make quick decisions in a fast-moving and competitive environment.
Q: Does the approach to automation differ between the European and North American markets?
A: While there are differences in culture and business norms, many warehouses across the globe are facing similar challenges. They’re looking for reliability, efficiency, and adaptability in their warehouse, and robotic solutions can help to achieve that. Our solutions are equipped to adapt to any warehouse, regardless of its needs or size, so while our approach to automation does not change from region to region, our ability to customize solutions to our customers’ needs allows us to conduct impactful business across the world.
Q: What advice would you give someone looking to launch their first automation project?
A: Warehouse automation helps customers find answers for common issues within their supply chain. Those problems can range from a lack of resiliency in an unsure environment to difficulties with scaling in a fast-growing market. My advice for someone looking to build more automation into their operations is to really put effort into understanding what problem they’re looking to solve. Is it inadequate storage capacity? Is it throughput limitations? Is it labor shortages? Robotic systems provide a versatile and all-around solution for many typical operations shortcomings, but they don’t all address the same issues. So, it’s important to ensure that the selected solution will be the best fit for your specific needs.
The second piece of advice I can offer is to look for a solution that will minimize disruption to your operations. The initial automation project can be challenging for organizations that have to adapt to new technologies while also adapting to new ways of working. This often requires a strong change-management approach. With that in mind, the best solution will often be one that leverages technology to its full ability, to deliver massive improvements while implementing simple interfaces and an intuitive user experience. Shorter installation times can also be a huge plus to limit the impact of that disruption.
Q: How will the rapid developments in AI and machine learning affect future automation and robotic designs?
A: Rapid advancements in AI and machine learning have impacted many industries, and robotics is no exception. It’s easy to see how AI/ML has the potential to create more intelligent, adaptive, and effective robots. What’s hard to tell now is whether AI has a real purpose or place in warehouse robotics today, where perfection is so important. AI may not be at a place yet where it’s stable enough for business-centric use cases, like warehouse robotics.
A move by federal regulators to reinforce requirements for broker transparency in freight transactions is stirring debate among transportation groups, after the Federal Motor Carrier Safety Administration (FMCSA) published a “notice of proposed rulemaking” this week.
According to FMCSA, its draft rule would strive to make broker transparency more common, requiring greater sharing of the material information necessary for transportation industry parties to make informed business decisions and to support the efficient resolution of disputes.
The proposed rule titled “Transparency in Property Broker Transactions” would address what FMCSA calls the lack of access to information among shippers and motor carriers that can impact the fairness and efficiency of the transportation system, and would reframe broker transparency as a regulatory duty imposed on brokers, with the goal of deterring non-compliance. Specifically, the move would require brokers to keep electronic records, and require brokers to provide transaction records to motor carriers and shippers upon request and within 48 hours of that request.
Under federal regulatory processes, public comments on the move are due by January 21, 2025. However, transportation groups are not waiting on the sidelines to voice their opinions.
According to the Transportation Intermediaries Association (TIA), an industry group representing the third-party logistics (3PL) industry, the potential rule is “misguided overreach” that fails to address the more pressing issue of freight fraud. In TIA’s view, broker transparency regulation is “obsolete and un-American,” and has no place in today’s “highly transparent” marketplace. “This proposal represents a misguided focus on outdated and unnecessary regulations rather than tackling issues that genuinely threaten the safety and efficiency of our nation’s supply chains,” TIA said.
But trucker trade group the Owner-Operator Independent Drivers Association (OOIDA) welcomed the proposed rule, which it said would ensure that brokers finally play by the rules. “We appreciate that FMCSA incorporated input from our petition, including a requirement to make records available electronically and emphasizing that brokers have a duty to comply with regulations. As FMCSA noted, broker transparency is necessary for a fair, efficient transportation system, and is especially important to help carriers defend themselves against alleged claims on a shipment,” OOIDA President Todd Spencer said in a statement.
Additional pushback came from the Small Business in Transportation Coalition (SBTC), a network of transportation professionals in small business, which said the potential rule didn’t go far enough. “This is too little too late and is disappointing. It preserves the status quo, which caters to Big Broker & TIA. There is no question now that FMCSA has been captured by Big Broker. Truckers and carriers must now come out in droves and file comments in full force against this starting tomorrow,” SBTC executive director James Lamb said in a LinkedIn post.
The “series B” funding round was financed by an unnamed “strategic customer” as well as Teradyne Robotics Ventures, Toyota Ventures, Ranpak, Third Kind Venture Capital, One Madison Group, Hyperplane, Catapult Ventures, and others.
The fresh backing comes as Massachusetts-based Pickle reported a spate of third quarter orders, saying that six customers placed orders for over 30 production robots to deploy in the first half of 2025. The new orders include pilot conversions, existing customer expansions, and new customer adoption.
“Pickle is hitting its strides delivering innovation, development, commercial traction, and customer satisfaction. The company is building groundbreaking technology while executing on essential recurring parts of a successful business like field service and manufacturing management,” Omar Asali, Pickle board member and CEO of investor Ranpak, said in a release.
According to Pickle, its truck-unloading robot applies “Physical AI” technology to one of the most labor-intensive, physically demanding, and highest turnover work areas in logistics operations. The platform combines a powerful vision system with generative AI foundation models trained on millions of data points from real logistics and warehouse operations that enable Pickle’s robotic hardware platform to perform physical work at human-scale or better, the company says.
Bloomington, Indiana-based FTR said its Trucking Conditions Index declined in September to -2.47 from -1.39 in August as weakness in the principal freight dynamics – freight rates, utilization, and volume – offset lower fuel costs and slightly less unfavorable financing costs.
Those negative numbers are nothing new—the TCI has been positive only twice – in May and June of this year – since April 2022, but the group’s current forecast still envisions consistently positive readings through at least a two-year forecast horizon.
“Aside from a near-term boost mostly related to falling diesel prices, we have not changed our Trucking Conditions Index forecast significantly in the wake of the election,” Avery Vise, FTR’s vice president of trucking, said in a release. “The outlook continues to be more favorable for carriers than what they have experienced for well over two years. Our analysis indicates gradual but steadily rising capacity utilization leading to stronger freight rates in 2025.”
But FTR said its forecast remains unchanged. “Just like everyone else, we’ll be watching closely to see exactly what trade and other economic policies are implemented and over what time frame. Some freight disruptions are likely due to tariffs and other factors, but it is not yet clear that those actions will do more than shift the timing of activity,” Vise said.
The TCI tracks the changes representing five major conditions in the U.S. truck market: freight volumes, freight rates, fleet capacity, fuel prices, and financing costs. Combined into a single index indicating the industry’s overall health, a positive score represents good, optimistic conditions while a negative score shows the inverse.
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."