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Seek Intelligence before Automation

30 July 2020

When it comes to automated warehouses, at SEC Storage, we're huge fans. So much so, that we have an entire division devoted to it. However when looking to deliver the required efficiency and productivity levels of 'tomorrow's warehouse', automation is rarely the most optimal solution available.

In our collective eagerness to celebrate and promote technological innovation, we have created a dangerous myth: that optimisation and efficiency are equivalent. They are not. Sure, efficiency is fundamental to optimisation, but so is effectiveness, adaptability, return-on-capital and mitigation of risk. When you consider all of those factors, automation will be beaten by other solutions nine times out of ten.

Automation is a tool, rather than a target. Intelligence, on the other hand, is a fundamental ethos, applicable to every business, and the key to unlocking optimal warehouse operations. An 'intelligent warehouse' is any storage facility and associated operation that is configured to regularly acquire knowledge, and use it to improve performance in all of the relevant factors listed above.

At its most basic, this could be a facility with a management team at least partly dedicated to the perpetual improvement of operations. At its most sophisticated, this team is complemented by board-level representation focused on aligning the warehouse to the global business strategy, as well as possessing an artificially intelligent system that generates operational insights and improvement suggestions continuously. Something that is, believe it or not, achievable by all businesses, regardless of size.

The vast majority of warehouses in the UK possess only low-levels of intelligence (including many of the automated ones) - albeit this is rarely the fault of those that work or manage them. At board-level, a false belief prevails that warehouses are cost-centres to be managed, rather than areas that can add value. This approach is dangerous on two counts. First, logistical performance is becoming increasingly important to consumers, and in many sectors now outranks product and even price as the key reason to buy. Secondly, intelligent warehouses generally provide a cost advantage over competitors.

The good news is that virtually every organisation is capable of affordably increasing the intelligence of their warehouse, by introducing two base philosophies. First, become data-oriented. Capture information about every aspect of your warehouse; product-volumetrics, throughputs, hit-rates and stock-levels are crucial. Insights can only be gained from knowledge. Secondly, create a network of experts who understand how to utilise and leverage data to develop better processes, functions and operations. Note, that this does not need to be expensive. At SEC, for example, such is our confidence that we'll be able to provide a clear business case and rapid ROI on warehouse improvements, that we offer our award-winning design, analysis and simulation services completely free of charge.

So, as you consider what tomorrow's warehouse looks like for your organisation, we encourage you to ensure that before you do anything else, you embed the only philosophy or technology that is guaranteed to fit your business, and seek intelligence before automation.
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