Warehouse management is a complex process which requires human involvement as well as technology intervention. However, the emergence of warehouse automation has altered the dynamics and made technology the key parameters to drive operational efficiencies such as inventory visibility, process transparency, space utilisation, faster turnaround time, etc. In the post-Covid-19 scenario, tech-enablement has assumed greater significance as functioning with the reduced workforce to comply with the social distancing norm has become a new normal for warehouses across the country.
The warehousing and contract logistics space is extremely competitive and demanding from the customer-service point of view. As a result, factors like operational efficiency and customer satisfaction have become non-negotiable. On the other hand, due to the pandemic impact on the economy, cost-efficiency aspect has become important for the clients. Therefore, investing in technology up-gradation to enhance efficiency will only add to the bottom-line stress of the companies in the warehousing and contract logistics sector.
Technology up-gradation, in a way, has become indispensable as demand for modern warehouses with higher throughput is steadily increasing with e-commerce players taking up the major share in the essential and non-essential consumption space and labour shortage making the situation increasingly challenging for the warehouses to meet that demand. Add to that, the domestic manufacturing sector is also showing signs of revival after the lockdown phase. Multinational companies are also exploring options to move their supply chain to India. So, to capture that growth spectrum, warehouses need to be ready with an expanded service bandwidth.
Globally warehousing companies are now aggressively opting for automation to enhance speed and precision in managing and delivering the cargo. But, the cost of buying and setting up those technologies and the longer payback period of those technology investments have turned out to be the biggest hurdle for warehouses in India. Few years back, the payback period of such technology investment used to be around seven-eight years. Although the period has recently reduced to almost five years, is still pretty high for the warehousing companies India from the sustainability point of view.
The way out would be to find the right mix of technology and human capital. As the labour cost is still low in India compared to that in developed countries like the US and those in Europe, automation must be implemented in such a way that it enhances the productivity of the people employed in the warehouses. The idea is to offer cost-effective, sustainable yet efficient warehousing solutions by empowering the human capital. For instance, a useful technology like voice picking can enhance the manpower productivity and operational accuracy to a great extent, as it keeps the hands and eyes of the workers free. It saves training time as the workers in a warehouse using voice picking technology are guided by a voice, not by any document or gadget. Another helpful technology being used is ring scanner which is an effective substitute to bulky hand scanner. It not only enhances operation efficiency in the warehouse but also helps warehouses manage huge volume of cargo with reduced manpower. In addition, cubic space optimizing techniques can also be implemented in warehousing to increase efficiency. Heavy duty racks or multi-tier racking systems can be installed that not only optimize space but also endure daily wear and tear to reduce downtime.
To achieve better cubic space utilisation, the warehouse structure can be built with the provision of standard 12 metre to an upward of 15 metre clear height. There has to be 6-7 air changes in the warehouse to enhance the productivity of the people working inside. The floor strength should be of minimum 6 tonne load-carrying per square metre so that it can support tracking, shelving, automated storage and retrieval system (ASRS) and facilitate adaptation of newer automation systems.
Sustainable warehousing practices or green warehouse solutions can also be implemented to reduce cost. The warehouse should have the required roof strength to bear the load of solar panels. Overhauling lighting system by replacing all peripheral lights with individual solar panels, introducing energy efficient equipment, implementing recycling facilities, rainwater harvesting etc. reduce operational overheads to make the operations cost-efficient. All these initiatives will also help warehouses to meet the global benchmark.
In India, warehousing companies need to find a balance between technology and manpower while implementing automation rather than going all out to integrate technology. The due diligence before setting up technology in a warehouse should include scrutiny on the compatibility of the technology with the manpower. The Flexibility of human labour must be leveraged to facilitate an effective tech-integration.
E-commerce companies have already started moving towards implementing such useful wearable technology. The warehouses should also take a leaf out of that trend, as throughput demand will only go up from here. However, that doesn’t mean that warehouses will have to double down their efforts to achieve tech advancement. They should be in sync with the market realities.
Disclaimer: The views expressed in the article above are those of the authors’ and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.