Interview: Markus Schmidt of Swisslog Logistics Automation – Americas

Markus Schmidt is a Swisslog veteran and has been president of the Americas region since 2005, which includes Swisslog operations in North America and Latin America. During his tenure, the organization has grown to more than 400 people with revenues in excess of $250 million. He is also a member of the board of the Switzerland-based automation and material handling company as well as a member of the top management circle of Swisslog’s parent company, Kuka. Prior to his arrival in the U.S., Schmidt was managing director of Swisslog in the U.K.

As president of the Americas region, Schmidt implemented Swisslog’s market focus strategy in establishing consumer-goods and e-commerce/retail business units in these markets. He also spearheaded the acquisition of systems integrator Forte in 2015 and pallet-shuttle system manufacturer Power Automation Systems (PAS) in 2016.

Schmidt, who earned his degree in production manufacturing at the University of Cologne in Germany, has also been actively involved with MHI, serving as a member of its Roundtable Advisory Committee for eight years. He recently spoke with DC Velocity}Editorial Director David Maloney.

Q: How do you view the current state of the material handling market?

A: Just a few weeks ago, I would have said that the market for material handling equipment and software was thriving and highly competitive. We are certainly seeing the increased adoption of goods-to-person automation systems for cube storage like AutoStore, mobile robotics solutions like CarryPick, and high-speed case-shuttle solutions like Cyclone that were considered risky to adopt six to 10 years ago but are now seen as proven, reliable technologies and essentially mainstream.

The trend toward the rapid adoption of flexible, robotic, and data-driven solutions is accelerating. We also see this clearly in the entry of venture capital into the market to fund numerous startups and invest in existing companies.

There is a discernible movement away from the more rigid bolted-down systems that are based on miles of conveyor and sortation equipment. Although those kinds of systems still have their place in the market, they really represent an era of mechanization more than they do automation.

Particularly with the recent explosion in e-commerce, companies are looking for solutions that afford them greater flexibility, take up less space, and have the ability to adapt to rapidly changing requirements in the market. They want solutions with more embedded intelligence that can optimize based on the data that is being continuously collected by sensors and software.

While I still believe in these megatrends, this was also before the novel coronavirus that caused the Covid-19 pandemic had made its way to the USA. In just a few short weeks, things have rapidly changed. Suddenly, the supply chain is at the center of every conversation, and now the entire world is waiting to see how our economy recovers. Consumers are relying more than ever on e-commerce and e-grocery, resulting in increased adoption and shopping preferences that may never return to pre-pandemic levels.

While some industries may be stunted in the short term by this pandemic, one thing is certain: All companies will be changed by this experience. After we make our way through this difficult time, I expect corporate behaviors to change, and Swisslog is ready and looking forward to continuing to innovate and automate their supply chains.

Most importantly, I am proud of our Swisslog team that has been “essential” for our medical and consumer-goods customers working to install goods-to-person systems that are set to go-live in the next months, as well as our systems operations teams working onsite running our customers’ warehouses and our support teams for keeping things running smoothly.

Q: During your time as president of the Americas for Swisslog, the company’s presence here has grown tremendously. What insight can you share from that growth and expansion?

A: When Swisslog first entered the U.S. market, we were known as something of a boutique for our pallet-handling technologies like our Vectura pallet-stacker cranes for large retail customers. Pallet-stacker cranes and pallet-shuttle systems are still core to our DNA, and we continue to build on our very successful base of operations in the U.S. But the real game-changer for us was our entry into the e-commerce space with goods-to-person solutions like AutoStore, CarryPick, and Cyclone. We are the world’s largest integrator of AutoStore, but we also now offer an array of other types of solutions. Our CarryPick mobile robotic solution is gaining in popularity as is our Cyclone case-shuttle system.

We’re also now actively integrating robotic single-item picking with our goods-to-person systems to help companies solve their labor challenges. Our SynQ warehouse software is a comprehensive solution that orchestrates equipment, processes, and people—really the brains behind every solution we implement. These are the factors that have really driven our growth in recent years.

Also, we maintain a very customer-centric organization with a robust customer support operation. In recent years, we’ve focused on developing training programs that are critical to supporting our growth and expansion. To state the obvious, Swisslog only exists because of our customers. And with each expansion, we have added passionate and dedicated employees.

You could say that our customer-centricity is what makes us stand apart, but we’ve also worked hard to demonstrate that we are taking care of our greatest asset, our people. Successful talent recruitment, training, individual support, and leadership development embedded in a dynamic culture of innovation with mutual respect—that’s what has really enabled our growth in recent years.

Q: What are the advantages of working with a company like Swisslog that offers a wide range of warehouse solutions?

A: As a global company, we can bring our expertise from different regions of the world to our customers here in the U.S. We work in a very collaborative environment and see ourselves as one Swisslog, no matter whether we’re here or in Europe or the Asia Pacific. We share key learnings from the work we’re doing all over the world to automate distribution operations. Although we are not all things to all customers, we do offer a wide range of technologies that can be tailored to the specific requirements of each customer in each region.

We have organized our company around specific industry segments, so our people have developed deep expertise in those industries. The needs of a refrigerated warehouse handling pallets are quite different from an e-commerce operation, so we bring the correct resources to bear on every opportunity. While we are global and provide such benefits, we “act local” and have a sizable organization in the Americas to be close to our customers, not only for support, but also for software and controls deployments and all related project services.

Q: What do you feel the next few years will hold for automation applications within distribution centers?

A: In the coming years, we expect to see the increased adoption of flexible and scalable solutions like our CarryPick mobile robotic storage system, because the system can easily and quickly scale up or down as needed without disrupting operations. At the same time, our customers increasingly see the hardware or equipment as something of a commodity, so what will really differentiate us is our expertise and our software. The more intelligence that is embedded in a system, the more easily it can optimize itself to changing demand without intervention.

Whether we call it “the Industrial Internet of Things” or “Industry 4.0,” we are definitely headed toward a future where the software and algorithms behind the system are what is most important. Needless to say, e-commerce automation will continue to grow and, in many cases, will move away from large distribution facilities toward smaller, more agile fulfillment centers that are closer to the customer.

Q: You have been involved with MHI and other groups for a number of years. What do you see as the value of working within industry associations?

A: I was elected to be on MHI’s Roundtable Advisory Committee for two periods of four years each from 2010 to 2018. While the association is not playing an active role with respect to the supplier/customer relationships, it often provides platforms for those parties to find each other, like the huge industry trade shows that MHI runs. Also, it should not be forgotten that best-practice standards and regulations are driven by associations, and that these groups also provide general education opportunities for employees who want to enter our industry.