How Can CIOs Use Robots To Reduce Costs?

CIOs are using robots to get the most out of small spaces
CIOs are using robots to get the most out of small spaces
Image Credit: Matt White

Although every CIO loves new technology, we also understand that the company that we work for only has so much money to spend. What this means for us is that one of our most critical jobs is to find a way to use information technology to save the company money. Some enterprising CIOs understand that the cost of maintaining large warehouses can be a very expensive proposition for many firms. They believe that they may have found a way to allow the company to shrink down the size of the warehouses that they need to maintain. What’s their secret you ask? It’s simple – robots.

Welcoming Robots Into The Warehouse

So just exactly what are CIOs using robots to do in their warehouses? Robots can be used to slide up, down and across metal racks as they select bins and move them to the warehouse floor. Once the bins are on the warehouse floor, dozens of low-slung, mobile robots sweep along to move the bins to stations where human workers will finally get their hands on the goods. The intricate interaction, controlled by software and executed with automation, powers a strategy known as “microfulfillment”. It is aimed at speeding up the delivery of goods to consumers in cities through operations that pack large numbers of products into tight, urban spaces.

The sites are far smaller than typical sprawling, labor-intensive distribution centers in remote industrial parks, and they are becoming a new focus for the person with the CIO job as they attempt to adjust to the dizzying changes in consumer markets. Some CIOs had been testing compact fulfillment sites in recent years, but the rush to online shopping during the coronavirus pandemic is accelerating moves toward space-saving, automation-powered warehouses. By squeezing those operations into urban warehouses and onto the backs of stores, CIOs hope to pare delivery times so online orders reach their destinations in hours, not days.

The goal of these smaller warehouses is to allow companies to store goods at the site and be able to get orders picked and packed in five minutes or less with only a handful of workers. CIOs understand the savings when they can use a very small number of people. Each site is important; however, the ultimate goal is to be able to create an urban logistics network that can serve multiple brands or retailers. Most microfulfillment operations are still in the process of being tested, but the strategy is gaining interest as grocery chains and other retailers scramble to meet rising e-commerce demand during the pandemic. The market for automated grocery microfulfillment centers is estimated to be worth $1.2 billion by 2024.

Next Steps For The Robots

The use of robots in warehouses can have many different benefits for a company. As an example, one grocer is installing several automated microfulfillment systems that will support the chain’s curbside pickup and delivery business. The microfulfillment structures are essentially giant cubes packed with bins that sit on atop one another, with the most commonly selected items on top for faster access. Robots travel across the top of the cube, digging out bins and delivering them to stations where workers assemble the orders.

What the person in the CIO position needs to realize is that the key is storing the products in spaces only robots, not humans, can reach. There is no vertical airspace between bins and only about 6 inches of space between stacks. Grocery installations in robot operated warehouses typically include three different sections: one for room-temperature products, another for cooler items and a manual picking area for fast-moving goods.

Non-grocery retailers have been slower to embrace the concept, industry experts say. However, for grocers coping with surging online demand during the pandemic, the technology offers a faster return on investment than larger robotics-equipped warehouses while allowing retailers to fill orders more quickly than they can with human workers walking store aisles. CIOs realize that this will allow their company to do a lot more baskets and have a later cutoff. The result of this is that the company could get an order at 12 noon and get it on their doorstep by 3 or 4 p.m. or earlier.

What All Of This Means For You

CIOs who understand the importance of information technology are looking for ways to save their company’s money. The use of robots to do the jobs that humans used to do is one way that this can be accomplished. An additional challenge that many companies are facing is having to create warehouses to serve large metropolitan areas. CIOs are now starting to use robots to run smaller warehouses that can be located in or near to large urban areas in order to save the company money.

CIOs are using robots to deliver a strategy known as “microfulfillment”. This strategy is designed to speed up the delivery of goods to consumers in cities through operations that pack large numbers of products into tight, urban spaces. These are smaller spaces than other larger warehouses. The move towards doing this has been accelerated by the boom in online ordering. The goal of these sites is to get goods picked and packed with just a few number of workers. These types of robot warehouses can benefit grocers. An advantage of this type of warehouse is that goods can be stored in spaces that robots, not humans, can get to. This new technology will allow firms to have a quicker return on investment than traditional automated larger warehouses do.

CIOs have always known that robots were in their future. However, they may have been planning on adding those robots to the existing warehouses that their firm has been operating. With the surge in online ordering as people stay home during the pandemic, CIOs are now starting to consider what it will take to automate smaller warehouses that they can build closer to dense urban areas. This use of robot technology might be just what CIOs have been looking for in order to introduce this new technology into how the company is run. Small warehouses may just be the start for the arrival of robots!

– Dr. Jim Anderson Blue Elephant Consulting –
Your Source For Real World IT Department Leadership Skills™

Question For You: How small do you think that a warehouse could be before it would not make sense to use robots at them?

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What We’ll Be Talking About Next Time

The Covid-19 pandemic has been a long, hard, path for everyone. Only now is a light starting to appear at the end of the long dark tunnel that we have all been in. Vaccines are racing through the testing phases and once they become available everyone is going to want to get one. What this means for healthcare CIOs is that they need to start planning now for how they are going to keep their vaccines secure so that they can be distributed to the people who need them the most at the right times.