Robotics and Job Security in the Supply Chain

Blog - Robotic Arm Lifting Supply Chain WordIt seems that there’s a robot available for every conceivable position imaginable these days and it can get quite unnerving if you stop to think about it. What human position or function can you think of that isn’t vulnerable to robotic transplanting? Technology feeds on itself and expands exponentially. What used to take a machine the size of a bus for computational functionality can now be fit in the palm of your hand. Communication and data management have taken over the keywords of labor and social interaction.

The sophistication of algorithms along with the sensing capabilities and machine interactions of today are reaching a turning point in the need for human intervention. “Beam me up Scotty”, doesn’t seem as futuristic as it once was. When 3-D printing can recreate skeletal structures in biological as well as physical elements from across the globe and cryogenics is increasing the speed of currents across a myriad of components one has to wonder what we will yet discover within our lifetimes.

Blog - Robot laying downASCI Red was designed to be the first supercomputer to process more than one teraflop. A ‘flop’ is a floating point operation, i.e. a calculation involving numbers which include decimal points (these are computationally much more demanding than calculations involving binary ones and zeros). A teraflop is a trillion such calculations per second. Once Red was up and running at full speed, by 1997, it really was a specimen. Its power was such that it could process 1.8 teraflops. That’s 18 followed by 11 zeros. Red continued to be the most powerful supercomputer in the world until about the end of 2000.

Today, most of us have already played on a machine that can process 1.8 teraflops. This Red equivalent is called the PS3: it was launched by Sony in 2005 and went on sale in 2006. Red was only a little smaller than a tennis court, used as much electricity as eight hundred houses, and cost $55 million. The PS3 fits underneath a television, runs off a normal power socket, and you can buy one for under three hundred dollars. Within a decade, a computer able to process 1.8 teraflops went from being something that could only be made by the world’s richest governments for purposes at the furthest reaches of computational possibility, to something a teenager could reasonably expect to find under the Christmas tree.

Blog - kiva-systems-robotic-warehouseHumans seamlessly integrate perception, cognition and action. We use our sensors to assess the state of the world, our brains to think and choose actions to achieve objectives, and our bodies to execute those actions.  Research teams are trying to build robots that are capable of doing the same with artificial sensors (cameras, microphones and scanners), algorithms and actuators, which control the mechanisms. But autonomous robots and humans differ greatly in their abilities. Robots may always have perceptual, cognitive and actuation limitations. They might not be able to fully perceive a scene, recognize or manipulate any object, understand all spoken or written language, or navigate in any terrain but, that’s not to say that researchers aren’t trying to close the gap on those differences.

Look around you. Regardless the size of the chain we consider, the movement, storage and sale of goods may well require the integration of perception, cognition and action as little as any industry that we care to contemplate making the supply chain as good a target as any to focus robotics research. Unmanned, automated forklifts with laser readers, GPS and radio frequency identification are already programmed to identify the location of its target goods but, can also move to, handle and relocate those goods without any human intervention.

Lights-out warehousing has almost become a reality in some of the more sophisticated DC operations. How much longer until this becomes the norm with the labor element as expensive as it is for getting product to the store shelf? How many miles of automated conveyors are already in use throughout the value chain? Bar codes and scanners did away with manual entry years ago while driver-less electric vehicles are already in limited use in some parts of the world. It’s catching up to us!

Blog - Amazon DroneBut, enough with all this scare mongering. Let’s look at the flip side of this coin; the reverse chain. Here’s an entirely different animal because it really hadn’t come into the spotlight until e-commerce came into vogue and I’m guessing that it’s this side of the Circular Economy that will save us from an onslaught of robotics. The reverse chain begins where the supply chain ends. Whether a product made it to the end user or was simply pulled from the chain as “unsalable” it is called distressed inventory or salvage in the industry and its ultimate grave is determined by humans, not robots.

Whether it ends up in landfills or is re-purposed for further use, is a turning point in how we define sustainability. The material makeup of any given element within a product has the potential to be recycled infinitely depending on the element composition. The cradle of virgin materials comes from Mother Earth herself but, if we had been smart about it over the years, we actually have enough “material” already available to us to make sure that we never have to mine for more.

Unfortunately, with the abundance that Mother Earth had provided us, we’ve been very poor stewards of those elements that she has entrusted to us. Mixing these elements to create the products that we have today has left us unable to reuse them in many applications. If we had taken the time to design products with a plan for their eventual reuse we would be in a much better position today to take greater advantage of recycling or re-purposing of those elements.

Blog - Fetch RobotsThe supply chain flows autonomous production to an ever widening audience of end users whereas the reverse chain attempts to gather back the products from that wide audience through the reverse chain and then back out again to an ever widening audience of re-purposing industries. This is much harder and much more labor intensive than the supply model.

The supply chain has been around practically since the dawn of civilization. Over the ages and quite typically of humans, we have simply applied the quickest or easiest solutions to the problems presented us as we’ve developed our supply chains without much thought to the consequences. Our current take, make and dispose mindset has to be turned around to one of take, make and reuse but, at what cost?

We are running out of certain key elements and climate change is threatening our livelihoods. Reverse chains have never been properly developed and it presents us with a monstrous sized ship to try to turn and whether we have the wherewithal to navigate these waters has yet to be determined.

Simply put, Reverse Logistics is defined as “the process of planning, implementing, and controlling the efficient, cost-effective flow of raw materials, in-process inventory, finished goods, and related information from the point of consumption to the point of origin for the purpose of recapturing value or proper disposal.” E-commerce, omni-channel fulfillment, social media and mobile communications are creating a groundswell of merchandise flowing through the reverse chains and retailers are struggling to keep up.

Reverse logistics has been the neglected child in the extended family of the supply chain in many ways. For many companies the priorities lie in making sure goods get out, not on managing their return in an efficient manner. Others are distracted by the fact that returns can be expensive and hard to administer. All this has meant returns have traditionally been dealt with as exceptions within the normal operation of core supply chain processes and IT systems. However, as the desire to improve customer service intensifies, reverse logistics has assumed ever greater importance.

Blog Supply Chain RobotWith this boom in online retailing has come some chaos in all areas of customer service and fulfillment, particularly with returns. According to data from a number of industry research firms, return rates for online sales are substantially higher than traditional retailing. Rates of 20% to beyond 30% for certain categories have been reported. Most fulfillment centers, information systems and customer service centers designed for handling traditional retail simply cannot efficiently process this volume of returned merchandise. As a result, returns costs are high and returning credit to consumers has often been slow. This poor performance is a barrier to new or repeat sales to time-focused buyers.

Many businesses have now realized that a Reverse Logistics system can be used to gain competitive advantage. Even the best retailers and vendors now have reason to review how their returns programs are managed. New technologies and service providers now offer an opportunity to improve overall ‘total returns performance’. This means not only reducing the ‘total cost of returns’, but utilizing returns to improve customer loyalty, merchandising and product performance. Improving ‘total returns performance’ can transform an increasingly costly and complex process into a competitive advantage. It has forced businesses to re-engineer their business processes and look into what can be the next practices in business rather than adopt best practices.

Efficient Reverse Logistics systems can transform an increasingly costly and complex returns management process into a competitive advantage. It can be used as an opportunity to re-engineer the business processes to get a better picture of the future practices. Reverse Logistics is a very complex and specialized area of any supply chain and it involves handling individual incoming parcels, opening and inspecting products, communicating with internal departments, customers and vendors and then directing products into disposition channels which will provide the highest value with the least environmental impact.

Blog - Smart-Robotics1Developing these systems will take time. Efficiency requires feedback from the system and often moves forward on a trial and error basis. Robotics may be threatening the security of certain positions in the supply chains but, one fact is sure; robotics will never truly be a threat to job security in the supply chain until we have developed the reverse chains to match the maturity of the supply. Whatever jobs are lost to robotics in the supply chain, it will take far longer to emulate that threat in efficient and sustainable reverse chains. It’s time to address intelligent process and system designs in Reverse Logistics that align with the environmental concerns of today. The competitive advantage is there for the taking. Let’s do it right this time!

The greatest threat to out planet is the belief that someone else will save it ~ Robert Shaw


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