Every industry has economic indicators they swear by. In the supply chain technology world, user conferences are one of those. Attendance figures at such events can tell you whether companies are feeling good enough about the economy that they’re willing to send their decision makers to a resort for three days and trust them to bring back actionable information that can help grow their business.
I’m witnessing that phenomenon firsthand this week while covering Dematic’s annual user conference in Park City, Utah. It was sold out—their first sellout in 25 years of offering this conference. In his opening comments, John Baysore, Dematic’s North America CEO, noted that his company’s business grew 25% since the last conference, achieving $900 million in revenue. He attributed this growth in business and in conference attendance to greater interest in e-commerce, omni-channel solutions, growth in overnight and same-day service expectations, and shrinkage in labor availability—hence the need for more automation.
We’ve blogged a lot about that last item—with regard to the shortage of skilled labor and the difficulty attracting talent to logistics careers. Much of this has to do with a dearth of education programs in material handling and logistics. Ironically, this event attracted a sellout crowd of people already employed in these fields. It is these people who should be taking on the additional responsibility of applying their learning for talent development. The folks at Dematic know that too—which is why they devoted an education track to talent development.
Even the “Experience” track, which featured case studies of well-known companies that embarked on automation projects, discussed various elements of lesson learning and talent development—on the job, within the scope of their projects.
For example, Dalen Mathys-Cook, director of supply chain for Peapod, the online grocer, and Paul Huppertz of the Progress Group, the consultants they used to build a new multi-temperature-environment fulfillment facility in New Jersey, talked about taking the time to make use of the talent in every group within an organization. Huppertz started this discussion by explaining the title of their presentation: “The Three Bears of Order Fulfillment—Which is Just Right for You?”
“If Goldilocks had never sat in three different chairs or three different beds she would have been forever uncomfortable, so you have to try different designs to find the one that’s just right,” Huppertz explained. Mathys-Cook was quick to advise her audience to budget enough time in the project to do that.
“It took us over a year to plan,” she said. “This was a very big investment for us. We knew we had to involve a lot of different groups in the process. Some people might see that as a negative, but in the end we made better decisions for our customers.
That time entails understanding up front how budget decisions will be made, who will have design approvals, and at what point in the process.
“We had a tendency at the very beginning when we were tasked to build this building and put the processes together to want to jump into the details immediately and we found we had to back up,” she said.
That’s because they didn’t factor in different pricing factors from different vendors in different regions.
“When we settled on our conceptual design we went out and got some budgetary estimates for equipment and software,” she continued. “Then we learned about installation labor and how different parts of the country have different prices on that labor. So after we already went through one set of data, that small detail turned into a very big detail. We had to go through an additional round of value engineering to arrive at the just right concept.”
Tim Faley of Grainger, the industrial equipment distributor, also used evocative imagery in the title of his presentation to illustrate the importance of using internal talent resources wisely in arranging “A Symphony of Automation at Grainger’s B2B Mega DC.” In automation projects, as in music, timing is everything.
“Before you move on to the next phase in the project make sure everyone’s on board,” he said. “You can’t just throw a thousand decisions on the table. You must rack and stack them. For a large project like ours [1 million sq. ft.] it can take two years to get where you want to be.”
And keep your expectations in check.
“If you’re planning on more than 50% productivity in the first month for a big system like this you’re probably too ambitious,” he advised.
Bottom line for these or any automation project: budget for the learning curve.
And that brings us back to the theme I introduced at the top of this blog: Cultivating talent. As Baysore implied, the scarcity of workers is one of the reasons automation is becoming so attractive. Nevertheless, even automated systems need talented humans to maintain them and to advise project managers on the realities of their operating environment. That’s why Dematic invited Seth Mattison, of BridgeWorks, LLC, human resources consultants, to address the topic of “Success and Succession in the Workforce of the Future.” He outlined the differences between the generations in his talk, but at the end of it, while everyone was going on to their next learning opportunity, I walked up to him and asked how these folks he just finished addressing will ensure there will be a new generation who target conferences like these to keep their material handling and logistics skills sharp. That needs to start now, he said—while kids are in school.
“They’re not exposed to the innovators in this industry,” Mattison said. “You have to harness the young people already working in these environments. Have them be the evangelists and visit universities, talking about the next big thing—how robotics will change the industry, for example.
The fact there were so many Gen Xers and Baby Boomers looking for inspiration in sessions like Mattison’s was a good sign that they’re eager to take this advice.