ProMatDX 2021: Businesses need to “right-size” the automation level for their operation

Automation is an essential ingredient for cooking up efficient material handling operations, but logistics and production companies now face such a wide range of options that they to make sure they apply the right amount of automation to meet their business needs, a panelist said today at the ProMatDX trade show.

As a business looks for ways to cut costs and boost productivity, it also needs to ask whether increasing automation is always the right thing, or if it might be possible to have too much tech for their business model, said Bastian Himmeroeder, principal and partner with Miebach Consulting.

According to Himmeroeder, some case studies show that certain companies could get better productivity boosts and return on investment (ROI) from low automation or semi-automated systems instead of highly automated DCs.

Signs that a warehouse should look to manual instead of automated systems include: highly seasonal peaks in product demand, easy access to cheap labor, availability of land, a short-term lease on the facility, or strict ROI requirements from their investors, he said. And many of the inverse conditions would make the case for more automation, such as: a two-to-three-shift operation, low and controllable peak demand, high labor costs, strict quality requirements, high inventory complexity, limited footprint, and building a “greenfield” DC.

In his session, Himmeroeder cited three examples of companies that found the best fit of automation levels for their particular conditions, including a fashion and apparel company that went with a highly automated warehouse, an air and oil filter manufacturer that chose a semi-automated facility, and a discount grocery store that decided low automation was the best fit.