The article has serious propositions for supply chain managers. Since there is scant literature in the area of warehouse automation, the results and practical information yielded from the research shall prove beneficial for both supply chain management practitioners and academicians. Specifically, they shall be accorded with tinformation on capital budgeting and management of risk.
The nature and the rationale for automation has been delved into in the current investigation. This has been carried out by gathering data from key stakeholders of automation projects, through semi-structured interviews. The accommodation of growth has been the central reason for migrating into automated warehouse systems. However, there are also other reasons cited, which include the improvement of service delivery and cost efficiency.
While there have been obvious difficulties in undertaking such change, most of the respondents adhered to their migration schedule and the budget that have been allotted to them. There has been emphasis on the potential risks of automation which include operational set-up failures, particularly the failure to meet service levels. Another noteworthy concern is the capacity of these organizations to sustain their flexibility given this decision to migrate towards automated systems.
The results of the study suggest that the decision to automate ought to be backed up by careful planning before deployment to be able to address its potential risks. Some of the pertinent information that have been gathered through the research include the industry profiles of the automation projects, the prime factors that brought about the automation, major concerns about warehouse automation, project sponsors and supplier selection criteria.
Moreover, the impact of the automation projects on onging operations has also been presented, along with the extent of information technology changes entailed in the migration effort. Of the 24 respondent companies, 2 who experienced severe disruption in their operations were also the ones who were not able to comply with their budget and their migration schedules. These clearly indicate the need for strategic planning in such efforts, since these have clear impact on the oeprations bottomline.
While these data are substantial in terms of spelling out what factors influence the success of warehouse automation, a solid model for successful migration has yet to be established and further research along this line is worthwhile. This formula for success may widely vary, depending on the several variables, including the dynamism of the industry in which the entity belongs. There is also a need to focus more on the sustainability of operations while the migration is transpiring, which again redounds to project planning and management. There is a clear need to heed budgetary and time constraints.
Overall, the rationale for migration is to reduce cost, accommodate expansion efforts, and improve service levels. These are worthy goals that may prove not too lofty if the project planning and management components are effectively laid down before deployment of the warehouse automation effort.