The COVID-19 pandemic’s disruptions have dramatically accelerated the growth of e-commerce, collapsing a growth dynamic that would have otherwise taken a decade into a few months. This shift in consumer behavior is placing new demands on all aspects of logistics and warehouse operations. E-commerce focused warehouses inherently require substantially more workers, space and transportation efficiency—differing greatly from traditional retail-focused warehouses. As a result, logistics and warehouse operators are looking for innovative solutions to increase worker productivity, asset usage and space utilization. Most importantly, the pandemic has highlighted the necessity for worker safety, not only to minimize disruption in operations and productivity but also to ensure worker satisfaction and increase retention.
While much of the focus has been on the “fully automated” warehouse, this vision doesn’t address the reality of where the technology stands today, the high-level of capital expenditure required, and the need for operational flexibility given the dynamic nature of e-commerce. Although certain aspects of warehouse operations lend themselves well for potential automation in the near future, it is widely accepted that full automation is at least a decade away. As a result, warehouse operators are actively exploring potential opportunities to leverage data and advanced analytics while exploring options to add automation that augments their current processes.
To address this urgent market need, cloud-based warehouse spatial intelligence (WSI) solutions—a new category of software solutions—have recently emerged. This new spatiotemporal approach combines unique spatial and real-time data (precise indoor location, HD images and videos, and advanced sensors) with advanced cloud-based analytics to gain actionable insights and automate decision making without human intervention. WSI solutions have been demonstrated to help improve real-time operational visibility, enabling logistics and warehouse operators to increase worker productivity, asset utilization and safety.
The commoditization of battery-operated wireless sensors, HD cameras, and cloud-based services have made the deployment and use of WSI solutions cost-effective and highly scalable, capable of achieving high ROI and rapid time to value. In contrast to traditional barcode and RFID data capture technologies, WSI systems leverage rich space contextual data in real-time. These new data sets are suitable for advances in data analytics, including computer vision, machine learning and artificial intelligence. WSI solutions can be leveraged as a stand-alone deployment or integrated with current WMS, TMS, LMS, IoT and ERP software applications via open APIs to extend and enhance the entire value proposition.
The ease of integration allows operators to analyze massive amounts of data without the need for changes to their current software systems. Unlike traditional approaches that leverage periodic and batch-level data analytics, WSI solutions allow data to be captured and analyzed in real-time. Additionally, WSI systems can be used by operators to gain operational visibility concurrently across all their facilities, helping to improve forecasting and strategic planning.
Following are some of the representative benefits that WSI-based solutions can bring to logistics and warehouses.
Labor cost is by far the highest contributor to the overall operating cost of a warehouse. Wi-Fi-based WSI location solutions can precisely locate and track workers with a precision of tens of centimeters in real-time, allowing operators to accurately measure and improve overall warehouse efficiency through travel time and distance travelled per worker. Accurate time-based activity analysis enables task allocation and scheduling optimization. Integration with warehouse management systems improves slotting, labor scheduling and inventory placement through intelligent recommendations to improve productivity. Relocating just a small percentage of high-frequency items based on WSI recommendations can achieve a much higher picking efficiency.
Asset and Space Utilization
Similarly, WSI solutions can be utilized to precisely locate and track forklifts, assets and other material handling equipment. Accurate time-based activity analysis provides continuous data to improve resource allocation. WSI solutions can generate precise aisle and shelf-level heat maps, and can optimize warehouse layouts, reduce aisle widths and drive better space utilization. This is particularly important for e-commerce as warehouses and distribution centers move into urban areas, placing significant emphasis on space utilization and increased warehouse efficiency.
Loading Dock Efficiency
WSI solutions can help reduce truck dwell time and increase efficiency with dock-level visibility across the entire warehouse. This allows better prediction of truck arrival and departure times across the facility, allowing for renegotiated shipping contracts, reducing costs through tighter dwell time limits and more. Integration of WSI with WMS allows warehouse operators to automatically allocate truck docks as they arrive at the facility or, in more advanced operations, when the truck’s cargo is being picked in advance of arrival to decrease the travel time and distance to load the truck. Additionally, WSI can be integrated with truck appointment and scheduling applications, as well as GPS (or other new IoT-based solutions) to accurately track the arrival of trucks to the warehouse. Automated and real-time alerts and integration with data-entry systems can improve overall communication and eliminate current labor-intensive processes.
Given the high number of workers required in urban e-commerce facilities and the current COVID-19 pandemic, improved worker safety is the highest priority—especially considering these are space-constrained indoor environments. Real-time location data and heat maps offer detailed congestion analysis, which helps to improve routing and movement within the warehouse and preclude collisions and other safety concerns. It allows operators to increase productivity by monitoring social distancing compliance, and optimize warehouse layout and operations to maintain safety. Additionally, WSI can be integrated with forklifts to assess and improve driver behavior and set up alerts to prevent unsafe forklift and worker interactions.
Integration with Robotics
As the industry evolves, there will be an increase in the number of automated material handling equipment that will be deployed within warehouses, including AS/RS, cobots and AGVs. While these will have their spatial analytics capabilities driven by lidar, vision systems and sensors, they need to co-exist with human workers and other legacy material handling systems. WSI solutions can play a key role in integrating the real-time location of workers, legacy material handling and new automated material handling equipment for seamless interoperability. For example, cobots know where they are within the warehouse, but they do not know where workers and forklifts are. WSI solutions can integrate all three key resources to further improve warehouse productivity and efficiency.
Finally, current warehouses will evolve from the current “four walls and a roof” to becoming fully connected with advanced analytics capabilities built-in so that operators can move in and start operations immediately. New versions of wireless connectivity including Wi-Fi, 5G and IoT will accelerate the integration of WSI into these connected warehouses, enabling the realization of a truly smart warehouse. Integrated WSI solutions will additionally address key facility applications, including improved energy efficiency, safety, maintenance and repair operations.
Over the past few decades, growth in e-commerce was already shifting how goods are stored and delivered, but today’s consumer has accelerated this shift exponentially. Operators are seeking ways to manage this new demand, increase capacity, and remain competitive while keeping costs low. Warehouse spatial intelligence solutions have the potential to address this increasing consumer expectation and become an essential tool in allowing operators to maximize productivity, efficiency and safety.
Vikram Pavate is CEO of Locix Inc., a provider of spatial intelligence solutions.