Logistics Viewpoints

A complete analysis of logistics trends, technologies, and services

Mobile Warehouse Robotics – Taking Stock of a Hot Technology Market

Robotics | By •

The mobile warehouse robotics market – call them AMRs or AGVs. To me, the acronym isn’t as important as the capabilities and the value the systems deliver to warehouse operations.

There is a vast amount of buzz surrounding this market. And for good reason. There is real value that can be delivered by these systems and great growth potential. However, much of the press is focused on the venture capital funding and acquisitions occurring in the market (by the way, these investments reflect extremely high valuations). Also, there is a reasonably good amount of technical details on the robots themselves, if you check. However, I find that content on how robotics systems deliver value to their end-user customers is lacking. The means of value delivery will remain top of mind for me as I research the current state and future direction of the market. As part of this process, I plan to write customer case stories that describe the context of mobile robotics deployments, specific characteristics of the operations, and the types and sources of operational benefits.

Research Scope

For the purposes of this research, ARC Advisory Group has defined mobile warehouse robotics (see IFR defintion) as load carrying vehicles that travel under their own control with a level of autonomy adequate to perform intended tasks based on current state and sensing without human intervention. The robots in the system must be capable of dynamically traversing from origins to destinations along multiple paths. Within our scope, we are including autonomous mobile robots (AMR) that utilize advanced location, navigation and perception capabilities sufficient for collaborative settings and robots that travel along dynamic routes, executed segment by segment, within a grid network. We are explicitly excluding vehicles that travel along a static, fixed path, whether that path of travel is guided by physical or virtual wires or lines.

Dimensions of Distinction

In general, the value proposition of these robotics solutions is derived from a combination of factors including productivity, reliability, flexibility, and scalability. The solutions differ across a number of dimensions, including processes they support and how they orchestrate workflows and activities within a facility. Furthermore, load size and general activity profile of a facility is an essential determinant of the relative importance of a robotic system’s capabilities. Smaller load operations typically pursue opportunities for performance improvements through a number of potential efficiency improvements. These operations often involve a great deal of activity and travel distance per worker for a relatively small item size. Therefore, orchestration of work, flexibility of bot activity (for example, decoupling of worker from a bot), bot costs, and other means by which tasks can be executed with efficiency are primary factors of consideration. Meanwhile, larger load operations are also interested in performance improvements, but place greater emphasis on safety because loads are larger, heavier, less stable, and of greater value than small loads. Lifting capacity, safety, reliability, cost of set up, and comparisons to other mechanical alternatives (think forklifts) is of importance in these applications.

Final Word

The mobile warehouse robotics market is an emerging market that has proven its value across a range of use cases, but it still at relatively low levels of current adoption. Put differently, there is still great opportunity for growth. It is my current assumption that the market has grown rapidly over the last few years and is likely to continue its growth in the years to come. However, this premise is certainly one I will be measuring, evaluating, and projecting during the research process. Please let me know if you have any comments or questions about my research into this market. It has been incredibly fascinating so far.

The Warehouse of Tomorrow: Sensing and Adapting to Change

Robotics | By •

An Interview with John Santagate, Vice President, Robotics at Körber Supply Chain

VP of RoboticsARC Advisory Group, in partnership with DC Velocity magazine, conducted survey-based research on the changing practices, priorities, and expectations of warehouse executives. This recently completed research uncovered many interesting insights, including the expectations for a rapid migration toward the adoption of warehouse automation. I decided to reach out to John Santagate, VP of Robotics at Körber Supply Chain, to obtain his perspective on these findings.

Clint:  ARC’s recently completed warehouse research shows that we are in the midst of a rapid migration toward warehouse automation. A full 96 percent of survey respondents indicated that they expect the warehouse automation value proposition (in comparison to the manual alternative) to increase over the next 3 years. As a VP of Robotics at Körber Supply Chain, you appear well positioned for experiencing some exciting changes.

John:  Investment in warehouse automation has certainly been growing rapidly. But warehouse robotics are truly reshaping the way organizations are handling materials within the four walls of their warehouse. They enable organizations to get a deeper level of insight about their operations through the amount of data they are delivering as connected assets. When technologies across the warehouse are connected together, delivering end-to-end flow of products and information, that’s the recipe for holistic optimization.

Clint:  Yes, holistic optimization and the breaking down of traditional silos is certainly a leading supply chain concept today. It’s a broad concept that has organizational, business process, and technology elements. Can you provide more detail on your perspective on this topic?

John:  Historically, logistics functions were approached as independent operating entities, in the sense that their focal scope was narrow – with limited insights on their function’s interrelationship with others. The process of optimizing independently tended to transfer inefficiencies elsewhere. Incentives were also structured in a way that prioritized the goals of the siloed operation rather than the extended operation. As processes and technologies matured, logistics operations began optimizing more holistically. Today’s sophisticated warehouses use digital technologies to establish the connective tissue of fulfillment operations, enabling broad-based performance improvements.

Clint:  Can you provide some more color on the mechanisms behind digital connectivity in the warehouse enabling performance improvements?

John:  For example, in periods of peak demand, warehouses have to adapt processes to handle the higher volumes. End-to-end visibility of the warehouse provides the ability to understand how a process change in one area of the warehouse will impact other areas of the warehouse. Leveraging digital technologies that are connected to physical assets, but managed by a central software application, delivers the level of visibility required to sense and respond more effectively than you can if you’re operating in silos.

Clint:  Speaking of digital technologies, we asked survey respondents to indicate the one warehouse technology investment that is the highest priority/importance to their organizations over the next three years. WMS was by far the most frequently chosen technology, as one may expect due to its necessity. But AGVs was the second most prevalent response. That surprised me. What are your thoughts about these findings?

John:  Actually, I wonder if some respondents took AGVs to mean autonomous mobile robotics (AMRs), with the nascency of the market I see this frequently. There is certainly use for both AGV and AMR in the market, but I do still see some misunderstanding that the two are a bit different. But I think WMS being the most frequently chosen technology is in line with today’s market. The fact is, there is increased demand on warehousing today. The fulfillment environment is far more complex, with more SKUs, more storage locations, and wider networks. Legacy WMS systems just aren’t capable of executing in today’s dynamic environment.

The complexities of the current operational environment are also compounded by the complexity of the technology landscape. If organizations are looking to deploy other warehouse technologies such as AMRs, the best practice is to tie them into the WMS to obtain a fully automated workflow. I believe organizations realize that integrating into a home-grown WMS is going to be more complex and costly than purchasing a modern WMS that has pre-built integration modules. So, I think that the WMS investment is in part driven by the increased demand for the other complementary technology areas.

Clint:  Let’s close with a discussion on growth expectations for fulfillment along various channels. Direct-to-consumer (e-commerce) fulfillment was the standout, with 51 percent of respondents expecting fulfillment of these orders to increase extensively over the next three years. Furthermore, when broken down by respondent industry, 70 percent of 3PLs expect their direct-to-consumer fulfillment volumes to increase extensively, while 58 percent of retailers have the same expectations. What are your thoughts on those findings?

John:  There is clearly a rapid increase in individual products being shipped to the consumer’s home, along with a large increase in returns processing. I think this trend is also responsible for the increase in piece picking volumes, fulfillment costs, and adoption of AMRs. I think they’re all interrelated. The expected increase in direct-to-consumer is going to put significant strain on organizations that aren’t prepared to evolve and don’t have flexible processes and technologies that allow them to adapt to a continuously changing environment. Today’s operations need to be capable of flexing and adapting, not just to peak season demand, but also changing product mixes. That’s especially true for 3PLs that are running multi-tenant warehouses and bringing in new customers on a regular basis. Adaptability is critical. A number of these organization are adopting AMRs, as they are tailored to these challenges. Collaborative AMRs, like Locus Robotics, are especially adaptable. Meanwhile, the constrained robot enabled automation, like Geek+, might be the better fit for an environment with higher velocity and more consistency.

Clint:  Agreed John. Flexibility is certainly a desirable characteristic for those looking to adopt warehouse automation and robotics in today’s fulfillment environment. Thank you for your insightful perspective. We look forward to learning more about Körber and its robotics practice.

HighJump is Rebranding as Körber Supply Chain

Logistics Software Vendors | By •

Today is day two of the HighJump Elevate user conference. Except it is no longer HighJump Elevate. Rather it is now Körber Elevate. This is due to yesterday’s official launch of the new corporate branding. Chad Collins, the CEO of HighJump, formally announced the transition of HighJump to Körber Supply Chain, and further stated that all of the twelve Körber Supply Chain companies will transfer to the Körber brand by this summer. Contextually, Körber Supply Chain Software is a business unit within Körber Supply Chain, which is itself one of five business areas of the Körber Group. Management believes that the one company Körber brand best represents the global, comprehensive capabilities of the organization as a whole.

The Supply Chain of the Future

Sean Elliott, the company’s CTO, took a step back to Elevate 2018 when they launched a vision of the supply chain of the future based on two fundamental principles – the increasingly strategic role of supply chain within business, and the realization that supply chain must be nimble to be a strategic contributor to business. And being nimble is essential to adaptability. Sean built out that vision further with four fundamental tenets of the supply chain of the future – Adaptability, Insight, Efficiency, and Connectivity. And I believe these tenets provide a valuable framework for evaluating the key attributes of a best in class supply chain. With this vision in mind, Sean stated that companies are focused on their present needs and looking to determine what technology they can implement to help their workers perform on the job or help management reimagine processes that are critical to their business. In essence, technology that will move operations toward autonomy while providing an immediate tangible return on investment. And Körber’s burgeoning robotics business is one way it is turning this vision into action.

Warehouse Robotics is Center Stage

In September, Körber acquired Australia-based Cohesio Group. Among other projects, Cohesio Group has seven Geek+ robotics implementations under its belt, including an apparel facility with over 200 bots. In  January, Körber announced its strategic partnership with Locus Robotics. Verst Logistics was noted as a flagship customer of the Körber and Locus partnership. And Fetch Robotics was announced at Elevate as a new strategic partner of Körber. These announcements were followed by the panel discussion on the rise of warehouse robotics, featuring Melonee Wise, the CEO of Fetch Robotics, Leif Jentoff, the Co-Founder of RightHand Robotics, Karen Leavitt, CMO of Locus Robotics, and John Santagate and Nishan Wijemanne of Körber.

Melonee Wise explained how the general availability of open source software around 2015 jump started the autonomous mobile robotics (AMR) market. At that time, a number of robotics companies burst on the scene. Karen Leavitt added that the price and capabilities of the technology have improved to the point where the business case can be demonstrated and proven for the appropriate uses. Leif Jentoff agreed that the ROI is there, particularly when the scale is appropriate. He further noted that the value is not only in the volumes but also in the predictability and reliability that robotics can bring to a warehouse operation. Melonee also stated that there is a need for a platform for the management of these devices. Proper platforms will help with maintenance and the ability to maintain and continue to deliver ROI on the robotics investments. Finally, Melonee commented on the value of the data provided by robotics. She made the analogy of a robot as one big DVR, providing information on movements, near misses, and other data that can deliver value at the process engineer level of the operation – providing insights for warehouse business process improvements.

Final Word

Six years ago I was introduced to the Körber brand from the company’s acquisition of Inconso. When Körber acquired HighJump I took notice. From there I learned about Aberle, Consoveyo and other warehouse automation companies within the Group’s portfolio. Today I expect to hear more and more about Körber within the context of warehouse management, warehouse automation, and robotics. Körber has certainly burst upon the scene as a global warehouse technology provider.

 

ProMat 2017 “Must-See” Technologies (at least for me)

Logistics Technologies | By •

The ProMat show will begin in less than two weeks. I thoroughly enjoyed the show two years ago and personally believe it is (still?) a more comprehensive trade show than its Atlanta-based twin, Modex. I have spent a good amount of time over the last week setting up interviews and otherwise planning my time for ProMat 2017. Those of you that have attended the show in the past will understand how easy it is to be overwhelmed without some sort of a schedule in place. I would like to take this opportunity to lay out what I consider to be my list of the “must-see” technologies for ProMat 2017.

  • Last year at MODEX I noted that autonomous mobile robotics (AMR) had moved from the concept phase to commercial availability and practical consideration. In particular, I mentioned Fetch Robotics and Locus Robotics. I felt those two solutions were practical, adaptable, and appeared to be financially feasible options for enhancing manual warehouse operations with flexible automation. This year I plan to meet with both exhibitors and find out what progress has been made with reference able customers. The concept has been proven, now it is time to learn about the practical applications of the robotics solutions, how they are being utilized in commercial settings, and how the value is being delivered (the specific sources of ROI).
  • Also from my review of MODEX, I mentioned Knapp’s YLOG shuttle and its flexibility, in particular its ability to pivot 90 degrees and run on the perpendicular axis. More recently, I noted that the YLOG shuttle’s flexible power system allows freedom of movement and it swiveling wheels facilitate the 90 degree turns that make the 3D movement possible. Similarly, I discussed Vanderlande’s Adapto shuttle and its ability to also move 3 dimensionally. However, its system utilizes a retractable set of wheels to facilitate the Z-axis movement. I plan to speak with executives from both companies to obtain a better understanding of these systems’ capabilities and the ideal load and throughput profiles for their usage.
  • I consider payload delivery from picking stations to packing, etc. to be the most technologically and financially feasible application of AMR in the warehouse. However, small item picking is also an area that is viewed as potentially feasible for automation by robotics. I plan to meet with Righthand Robotics to learn more about the innovative progress they are making in the area of robotic picking for e-commerce order fulfillment.
  • In the area of warehouse software solutions, I plan to take a deeper dive into Manhattan Associates’ new order streaming capability that provides a more flexible alternative to traditional waving. I also plan to see what warehouse automation companies are doing to expand the capabilities of their WCS solutions into more holistic warehouse execution (WES) or industrial internet of things (IIoT) solutions. In particular, I am interested in learning more about what Dematic is doing with the IP it obtained from the Reddwerks acquisition and I also plan to learn more about the new SensorThink platform that is going to be demonstrated at the Tompkin’s booth.

Please let me know if you think I missed an exciting and innovative technology that is being exhibited at ProMat this year. I look forward to informing you of my learnings from the show, come April.

Top Young Tech Companies Poised to Transform Supply Chain Management

Logistics Software Vendors | By •

The young companies that are poised to transform the supply chain management profession fall into a relatively few categories. The most interesting start-ups we are seeing have business models based on the sharing economy, the Internet of Things (IoT), predictive analytics, and robotics.

The Sharing Economy: Five companies are very interesting: Flexe, Deliv, Doorman, Transfix, and Shyp.

Flexe describes itself as a marketplace for warehouse space.  It is a cloud-based marketplace platform analogous to airbnb.  Flexe works in much the same way. So for example, if you are a distributor of Halloween costumes, your warehouse is far from being fully utilized after the holiday the holiday.  Your company can list your excess capacity on Flexe and provide companies that need short term warehousing services – perhaps a toy company with a hot new product release – 3PL warehousing services.

There is far more action among companies trying to pursue an UBER model for moving freight than on the airbnb warehousing services side. And among UBER style start-ups, most of the focus is on revolutionizing last mile deliveries.

Deliv describes itself as a bridge for the last mile gap between retailers and customers. The company is a crowd sourced delivery option that stretches across multiple retail segments. This company uses a smartphone app to alert pre-qualified drivers of a pending delivery, and the driver picks up the merchandise from the retailer and delivers it to the customer. This is all generated from an e-commerce order where a customer selects same-day delivery from the list of fulfillment options. Once the order has been picked up, the customer receives real-time tracking information to ensure they are home to receive the order. Deliv currently works with over 125 retailers in 17 markets across the US and is continuing to expand. With a large percentage of retailers interested in the use of crowd-sourced delivery options, this is a market that could continue to see new players in an already crowded space.

Doorman is another last mile delivery venture that takes a uniquely different approach. Doorman is all about ensuring customers do not miss a delivery, or have to worry about package theft. Customers have their packages shipped to a Doorman warehouse, and using their smart-phone app, schedule deliveries for when they are home. The key part of Doorman is that deliveries are scheduled between 6pm and midnight. For those people that work late and would generally miss a home delivery, this eliminates the problem. Doorman offers three pricing packages – pay as you go ($3.99 / package), the Gold Plan ($29 / month, includes 1 hour delivery windows and unlimited deliveries and returns), and the Silver Plan ($19 / month, includes 2 hour delivery timeframes and unlimited deliveries). The service also accepts extra-large packages, with an additional fee depending on the size.

Longer haul moves also have a lot of potential for the UBERIZATION of freight. In this segment, we talked to the CEO of Transfix, Andrew McElroy.  Instead of being compared to UBER, he prefers to call his company a “mobile-based freight brokerage.” Honestly, if the technology is similar, we don’t see much difference between a technology-enabled brokerage and an Uber freight platform. After all, a broker is a middleman who takes a small fee for connecting buyers and sellers. So UBER is a broker.

Analogous to UBER, the small trucking carriers’ drivers or dispatchers who have signed up with Transfix use their smart phones to confirm rates and tenders, download logistics documents, book a time for a pickup, and get turn by turn directions. Because the trucker’s phones are kept on, their trucks can be tracked, and shippers can use their Transfix application for track and trace purposes. Transfix wants to make themselves attractive to trucking firms, so they pay carriers in 24 hours and get reimbursed at a later date by shippers. Although they got started in 2013, they already have grown to over $1 million in gross revenues per month and are continuing to grow at over 15% per month.

The final sharing economy company we are highlighting is a little different take on things. Shyp is a packaging and shipping company that uses contract workers to pick-up, pack, and ship orders. A customer takes a picture of the item they are shipping through the Shyp app, and this starts the process. A Shyp courier arrives to ship the package through the lowest-cost option. The company will also package a customer’s order before bringing it to their warehouse to send to the final destination. The company charges $5 for pick-up, packaging pricing is based on size and fragility, and shipping uses the lowest rates available. This company is still tapping into the UBERIZATION of freight, but is bringing in the packaging angle which speaks to those people who do not want to spend the time packaging their own items.

The Internet of Things:  We have talked to four companies using IoT type technologies to help improve supply chain resiliency for inbound strategic materials. Two had customers we interacted with (Next Generation Supply Chain Risk Management: A Case Study and General Motors’ Approach to Supply Chain Resiliency) and who sung the vendors’ praises. Those two IoT companies are riskmethods and Resilinc.

We are also categorizing location-based technology under IoT. GPS is a ubiquitous technology in today’s connected world, due in large part to smart phones and the capabilities they offer. But use of GPS in the warehouse is limited by signal (GPS and cell tower) disruptions. What if you could use the magnet in your smart phone in place of your GPS coordinates? Here’s a story about a start-up named Reckon Point that is leveraging WiFi, the Earth’s magnetic field, and smart phone compass capabilities for warehouse process and location tracking.

Predictive Analytics: What is the difference between predictive analytics and forecasting? All forecasting involves making a prediction, but not all forecasts are based on Big Data. ClearMetal is an example of a company applying simulation and advanced analytics to Big Data to help ocean carriers improve their profitability. That is a simplified high level explanation. The details on how ClearMetal does this are actually very interesting. You can read those details HERE.

Warehouse Robotics:  We have written a number of times in Logistics Viewpoints about the burgeoning field of autonomous mobile robotics (AMR) in the warehouse. The availability of AMR for warehousing went into a bit of a lull after Amazon’s acquisition of Kiva. But recently there have been a few companies with novel robot applications that work collaboratively with people. These include Locus Robotics, a Massachusetts based start-up, and Fetch Robotics, a Silicon Valley start-up.  It’s worth noting that often the primary value drivers of these systems lie in the processes by which they deploy and utilize the robots to increase efficiencies, rather than in the individual units themselves.

Locus Robotics’ system recently became commercially available and is being used within its sister company’s (Quiet Logistics) fulfillment operations. Associates scan, then place items into totes placed upon and transported by the robots. The robots autonomously navigate through the warehouse infrastructure along with others in the fleet, guided by the Locus server. The value driver of this solution appears to be its flexibility and the intelligence with which it utilizes the robots and staff to efficiently manage the facility’s workload. Fetch Robotics developed a pair of robots, branded Fetch and Freight. Freight augments manual picking by following associates through the picking process and then autonomously dispatches the order to its warehouse destination while the picker continues with his/her picking process, supported by another Freight unit. Both of these solutions offer cost-effective alternatives to manual picking processes. The reasonable upfront investment costs of these systems and the potential ROI they can deliver will be factors driving user adoption and deployment of these systems.

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