HIGH POINT — New technologies centered around artificial intelligence , including the journey that a large parcel item takes on its way to the customer.
The path from the warehouse to the customer’s doorstep is fraught with potential pain points which businesses have worked to address with new technologies for decades, long before machine learning and AI came onto the scene. AI- enabled technologies are just the latest set of problem-solving tools that the industry has at its disposal.
Within the four walls of the warehouse, the story of AI’s impact is still in its early stages, but a leading expert in the industry tells Furniture Today that, wherever processes have been automated, there is a potential for AI to create efficiencies.
Adrian Stoch — chief automation officer at contract logistics provider , which says it generates roughly 30% of its revenue from automated solutions — said that AI’s effect on warehouse operations is primarily an “opportunity impact” at present, but notes that potential implications for these new technologies in terms of efficiency gains is “massive.”
“There are things that we can do today using machine learning and generative AI that we couldn’t have imagined previously,” said Stoch. “We are only beginning to see the true extent of the potential impacts.”
Caution required
Stoch explained that AI-enabled automation solutions have the potential to create efficiencies across the warehouse operation, with inventory management being a key area where these tools are already having an impact.
Because of their ability to analyze a large amount of external data, AI-enabled digital tools can help warehouse operators forecast for seasonal peaks in demand and automate the process of inventory replenishment, cutting waste and eliminating unnecessary overhead.
Stoch urged leaders and decision makers to be willing to shift their mindsets in accounting for the new possibilities and challenges that these technologies create.
“Here is the thing: The lesser part of the challenge is the technology itself. The bigger part of the challenge is process change and the organizational change in management that has to take place in order for leaders to effectively operate in an environment that’s under AI.” Adrian Stoch, GXO Logistics
Businesses should dispense with the assumption that old ways of doing things will cut it in this new reality, Stoch explained.
“The kinds of skills and discipline needed by a leader in AI warehouse environment, or even just an automation environment, are not necessarily the same as (the skills needed by) legacy manual operations leader,” he cautioned.
Saving elbow grease
One area of warehouse operations where human involvement has been especially ‘sticky’ for businesses is order picking.
Whether it is a large or a small parcel item, warehouses tend to rely on a human at the crucial step of confirming and picking an order; whether on foot or on a forklift, humans have long been the main mover.
Stoch explained that AI is already helping workers inside the “do the work with without waste,” which both creates value for the business and enhances the employee experience. AI-enabled tools can, for example, plot a worker’s most efficient path through the warehouse when handling multiple orders or loadings.
“That’s what automation and AI are doing,” he said. “We’re literally taking the heavy lifting tasks from our workers, making the job safer and allowing them to not have to walk miles upon miles through the warehouse.
“And we’re letting them work alongside collaborative robots or co-bots.”
While AI and related new technologies are reducing the number of humans involved in warehouse and inventory management processes, Stoch believes that human inputs into most of these systems will remain a factor well into the distant future.
“We are a long way off from a fully automated warehouse (without humans in the chain somewhere), not in our lifetimes.”
Final word on final mile
Once that large parcel item gets onto a truck and leaves the warehouse, its journey to the customer’s door is another puzzle wrought with potential pain points that AI-enabled tools are helping to solve, cost being principle among them.
A by last-mile delivery software vendor reports that 86% of logistics providers expect fuel and operational costs such as labor to further increase this year.
In addressing these ongoing challenges, GXO partners with UK-based logistics technology solutions provider to implement AI outside the four walls of the warehouse, and Stoch reported that his company has seen upwards of 15% cost savings due to route optimizations and fuel efficiencies made possible by these tools.
With these sources of uncertainty almost certain to continue weighting on logistics providers for the foreseeable future, Stoch noted that the technological tools that are solving entrenched problems are set to alter the logistics landscape in fundamental ways, but his overall outlook remains optimistic.
“The nature (of logistics) is absolutely going to change, but I see it in a very positive way,” Stoch said. “As technology advances, the rate of advancement accelerates alongside it, and we’re seeing it in exponential ways in this industry.”