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May 26, 2015

Enter the Smart Warehouse

With packing and shipping products from Lid’s, warehouse duties used to be one heck of a laborious process. Lids, an Indianapolis company, sells fashion athletic headwear, team apparel and other fan novelties. In the old days, order takers—known as pickers—would get a list of items and walk around the warehouse, looking for the right ones and loading them up in a tote.  It took a long time.

Recently, however, Lids started using an Internet of Everything (IoE)- based robotic system and life has become a lot more efficient.  Now a list with items is automatically sent to cart-like robots, which retrieve the products, place them in bins, and deliver them to a worker. The worker then loads the material onto a truck in the correct order. Sensors detect everything from a robot’s location to whether pallets are en route to the shipping dock and then wirelessly transmit that information to a remote monitoring team.

“Anything that’s moving in the warehouse, the system knows where it is,” says Bill Leber, director of business development at Swisslog, which sells the system and also provides 24/7 remote monitoring of operations.

Increasingly, companies are applying IoE technology to their supply chain operations. That includes connecting the different players, from suppliers to retailers. But it also involves another crucial link in the chain: warehouse operations. Such smart warehouses are able to accomplish a host of improvements, from reducing forklift damage to increasing productivity, with a significant impact on the bottom line.

The implications are especially important for manufacturers, retailers and distributors who are feeling the ‘Amazon effect,’ which has led many customers to expect speedy delivery of any product.  In addition, more retailers are ordering smaller orders more frequently. According to Tom French, this is a challenging proposition for warehouse managers. French heads Supply Chain Coach, a consulting firm in Dublin, CA. As a result, says French, “The challenge is to figure out how to become more efficient so as to keep the cost to manage product at the lowest point possible.”

Reducing Damage and Inaccuracies

How do these systems help warehouse operation efficiency? For one, there’s the matter of inaccuracies and loss of goods. Large warehouse operations must track a constant blur of moving parts—and real-time IoE devices increase the likelihood that the correct items will be shipped and companies know where items are. How does this work? The system would be able to detect products and parts, outfitted with an RFID tag and a sensor, and communicate information about them in real-time.  As a result, a distribution manager in a produce warehouse could identify not only an item’s precise location, but where it came from and number of days until expiration.  The upshot: That manager would always know the status of an item and also whether or not it’s still usable.

Or, consider the matter of reducing damage to equipment. Take Spokane Industries, a developer and manufacturer of sand and investment castings in Spokane, WA. With a 150,000 square foot facility with eight leased forklifts, the company found itself paying close to $40,000 in repairs when returning the equipment to suppliers at the end of a lease period.  “We knew we had to do something different,” says Sean Weeks, purchasing manager of the castings division.

So, the supplier installed an IoE system for monitoring impact. With individual electronic keys for every driver, the software, from Newport, DE-based TotalTrax, was able to record the activity of each person. That allowed the system to track patterns according to pre-determined vertical impact G-force thresholds and for managers to adjust those levels, if necessary.  Also, if they saw as spike in G-force impact, they could find out who drove the lift and at what time it occurred. After interviewing drivers, they also found areas in the plant where concrete floors or driveways had potholes and other problems, and made the necessary repairs. The result: Almost immediately, the company had a 90 percent reduction in impact related to vehicle damage.

Smoother Operations, Increased Productivity

In addition, there’s the ability to use IoE systems to make warehouse operations runs smoothly—for example, ensuring that one machine doesn’t diverge from its intended route and cause the entire process to back up.  Consider Swisslog’s system. With sensors and RFID tags attached to robots, conveyors and other locations throughout a warehouse, it can immediately detect when a robot moves from the place it’s supposed to be. Technicians at the company’s Newport News, VA, headquarters are able to detect when such a problem exists remotely—thereby avoiding a collision of robots trying to move  past the delinquent one.

Ultimately, the bottom line is increased productivity.  French points to Codeshelf, an Oakland, CA startup with an IoE system that, he says, can substantially increase the speed at which pickers find orders on a warehouse’s shelves and pack them up, especially when there are multiple small orders. The system organizes multiple orders for a product according to location in the warehouse. Then after pickers log in by scanning their badge into a reader, LED lights on shelves light up when they reach the location of a product they need to pack up. Managers can also analyze metrics for each picker. “You can manage your warehouse with real-time data,” says French, who uses the system when designing processes for clients. “That’s what you need to boost productivity.”


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Anne Field is an award-winning journalist who specializes in covering entrepreneurship and small business. A freelancer for many years, she has contributed to Bloomberg BusinessWeek, Business Insider, Crain's New York Business, Inc., and the New York Times, in addition to many other publications. She lives in Pelham, NY, with her husband, two children, and dog. Used with the permission of http://thenetwork.cisco.com/.

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