Supply Chain Automation For Modern Businesses

The opportunity to automate the supply chain is all around us. For some, this automation is a necessity to keep up with the marketplace and to drive down fulfilment costs. For others, it’s a science fiction idea that seems out of reach for the average business to implement. A recent Raconteur infographic highlighted the supply chain industries efforts and challenges with automation. 

When retail, manufacturing, and logistics professionals were surveyed they found that 55% of respondents were investing in warehouse automation and only about 4% were investing in delivery robots. 

Interestingly, a recent survey found that 31% of warehouse managers either already have automation technology or are looking to upgrade their existing technology. 71% of respondents said that they plan to invest in automation technology between now and 5 years from now. As labor markets continue to tighten and customer delivery expectations continue to rise, it’s no wonder that warehouse managers are looking to supplement their execution efforts with further automation.

Gartner is estimating that 30% of operational warehouse workers will be supplemented, not replaced, by collaborative robots by 2023. However, automation doesn’t have to be a complex mix of robots, machine learning, and sophisticated algorithms. Instead, automation can begin in a much more simple and basic approach. For example, communicating order status and documentation between supply chain stakeholders can be a great approach to removing the slow and error-ridden effort of manually keying orders into a WMS (warehouse management systems) or emails. Making these EDI connections is a relatively easy lift to accomplish. However, when retail, manufacturing, and logistics professionals ranked their degree of automation on a scale of 0 to 5 (with 0 representing a fully manual process and 5 representing a fully automated process) they scored on average a 1.9. This suggests that a significant opportunity for automation still exists within the supply chain. 

You may ask yourself why there seems to be such low rankings on automation when so many members of the supply chain are seeking additional efficiencies through the use of technology. Unfortunately, the answer to that question seems to be a lack of leadership’s willingness to invest. 63% of surveyed warehouse managers found that budget approval was the largest roadblock to achieving greater integration with supply chain partners. Additionally, lacking the resources to support these initiatives represent a collective 76% of the barriers for warehouse automation. 

Ultimately, everyone in the supply chain can benefit from greater visibility and improved execution speeds. But these enhancements are only possible if executives of these organizations truly commit to automation and direct system integrations. If you find yourself asking for resources in an organization that is not embracing automation and/or further technology investments then all I can say is, “keep up the good fight and hang tough”. The data suggests that more-and-more supply chain participants are looking to invest in automation which is a great move in the right direction. You won’t be alone for long.   

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