The COVID-19 pandemic has had vast impacts on industries across the globe, and many have had to adapt rapidly to changing circumstances in order to survive.
Automation technologies, particularly in grocery, warehousing and logistics applications, have suddenly become even more valuable, as they can provide essential services without risk of spreading the virus through human contact.
Lights-out logistics and the future of supply chains
When we think of the ‘warehouse of the future’, we think of a warehouse full of product, but no staff driving back and forth on forklift trucks, no load handlers examining products and picking items onto pallets, not even an electric light – just sky high racking, shuttles, lifts, robots, conveyors and autonomous vehicles choosing their own paths through the darkness, self-navigating with laser guidance systems.
This is ‘lights-out logistics’, and although it may seem futuristic, it is already being used today. And lights-out logistics can help supply chains become more resilient in times of great uncertainty and disruption, such as financial crises and pandemics like COVID-19.
Typically, a company’s reasons for automation include increases in productivity, space efficiency, accuracy and the return on investment (ROI) these technologies bring. But mega-trends such as globalisation, an aging population, health and safety, mobility, urbanisation, individualisation and digitisation also place indirect pressure on organisations to automate.
Megatrends and their effect on the supply chain during COVID-19
These megatrends have, in many ways, contributed to the rapid spread of the COVID-19 pandemic, and have significantly impacted the supply chains of grocery stores and other essential suppliers. These impacts include:
1. Mobility – Within weeks of the world first learning about COVID-19, it was detected in multiple cities around the world, as businesspeople and tourists carried it with them on their travels. Within a few months, it had spread worldwide, borders were closed, airlines grounded, and the world economy was in deep crisis.
2. Globalisation – As governments searched for ways to build a virtual wall around their nations and states, the world economy entered a period of unexpected deglobalisation.
3. Aging Population – Early on, COVID-19 revealed itself to be a stronger threat to those over 70 and for those with underlying respiratory health conditions. Panic buying, hoarding and a large increase in online orders forced major retail chains to re-think the way they supported their customers.
4. Health and Safety – Grocery stores were now understood to be critical infrastructure that would be kept open in any scenario, presenting a serious dilemma; how to protect the health and safety of frontline workers and customers.
5. Urbanisation – An unfortunate by-product of urbanisation is that shoppers have a limited appreciation for the current resilience of the grocery supply chain, which typically has months’ worth of inventory stored in DCs.
6. Individualisation – One of the more startling symbols of the crisis was the decision by some grocery chains to make up ration boxes full of the same selection of essential items for the elderly and more at risk and sell them online.
7. Digitisation – One of the few weapons the modern world had against the disruption caused by a pandemic was undoubtedly the internet. Aside from the working from home practices, doctors’ appointments were moved online, as were personal trainer sessions, social events, movie releases and grocery shopping.
Utilising automation for productivity and resilience
As explained by the CEO of Americold in a BBC article in mid-April 2020, there has never really been a shortage of food during the outbreak. The challenge has been getting it out of the supply chain and onto the stores shelves fast enough to keep up with demand.
High density, high throughput Automated Storage and Retrieval Systems (ASRS) technology for pallet handling, such as Swisslog’s PowerStore, could be real game changer in these prolonged spike scenarios moving forward – providing much needed horsepower to grocery chains willing to shift their focus from just-in-time to just-in-case.
A global supermarket giant has become one of the early adopters of Swisslog’s PowerStore system, which is currently in the testing phase in its distribution centre in the UK.
One of the learnings from the COVID-19 pandemic is that megatrends need to be given more consideration and weight than in the past. It will be interesting to see if more companies adopt automation strategies in response to COVID-19, and whether they see productivity and profitability gains that they otherwise wouldn’t have experienced.
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