In this month’s article from the Automated Material Handling Systems Association (AMHSA), Steve Knights, AMHSA Council Member, looks at the benefits of investing in the latest generation of automation.
The first organisations to adopt a new technology can reap the benefits of the competitive advantage that it can bring. Those who wait for the proven and improved later versions of a new technology can also gain an advantage but they may well be losing a significant edge as they wait.
Take, for example, one of the greatest inventors and entrepreneurs of modern times, Thomas Edison. One of his most famous schemes was to offer homes, offices and factories the new wonder of electricity. Edison provided a 110V DC supply programme and, as his power was far cheaper and more efficient than the existing town gas and kerosene, his customers prospered.
However, the thick and costly distribution wires of the DC system forced him to build lots of small, local power-generating stations close to his clients. Along came the Westinghouse organization with a more efficient AC system using transformers so that power could be sent over long distances with relatively small wires at very high voltages, and then stepped down to the voltage required by the user. Edison’s customers achieved competitive advantage, albeit for a limited period of time, before the more efficient AC power become the universal supply system.
Growth of e-commerce
There is a parallel between Edison and Westinghouse in automated materials handling today. Those who embraced automation early certainly secured the biggest commercial advantage but new technologies are giving later generations of automated systems a smaller but significant extra edge, which is particularly noticeable in multi-channel applications, fuelled by the growth of e-commerce.
Market demands have required suppliers to completely rethink their operations to meet changing consumer needs. This, in turn, has required the latest generation of automated handling solutions to be bigger, faster, modular and more flexible, combined with having lower capital and maintenance costs.
Therefore, automation is a far more attractive proposition compared to a few years ago and offers investing companies significant operational advantages in a highly competitive marketplace. Why is this so? Firstly, for all components the ‘economies of scale’ or mass production, together with the opportunity for standardised components across a product range, offer cost benefits to manufacturers and these are reflected in lower systems costs and increased reliability.
Secondly, system performance – coupled with modular design and a flexible solution – are key for customers to enable them to react to demand changes and seasonal fluctuations in customer orders. Today’s systems are faster, can be built higher and longer, and can achieve a wider range of operations through one system. They are also capable of handling a wide variety of container types and sizes with one solution. Thirdly, the power required to operate a solution and the systems controlling the automated equipment have improved immeasurably over recent years. For example, energy recovery systems have lowered operating costs.
The development of wireless control systems in place of hard-wired systems has improved performance and lowered costs. The capabilities of the hardware and software systems provide another area of massive and continuing change, allowing faster and more user-friendly operating systems. Finally, over the last few years the major automated handling suppliers have refined and honed maintenance procedures and their associated support contracts, such that the system ‘downtime’ is much lower and there is a much closer relationship between the suppliers and users of automated systems.