Future-proofing your investment: meeting the challenges of uncertainty
Investing in warehouse automation is like taking a gamble on the future. But there are ways to limit risks, here is some advice to avoid them:
Accurately size your automation project
Assessing the right automation configuration for your warehouses is a difficult exercise. It shouldn’t be too small, nor too big, but flexible and scalable to be able to:
- Meet the needs of existing customers and those who will arrive in the short term.
- Cope with peak and off-peak periods by adapting quickly to customer buying patterns.
- Follow business growth with increased capacity.
- Manage unusual circumstances and upstream and downstream disruptions.
Investing in the right automation technologies
There are hundreds of different solutions, from the most basic to the most innovative. Opting for a disruptive technology can give you an edge over your competition, but it can also be disastrous:
- You may be stuck with an unsupported technology if it is discontinued.
- The technology may not integrate with partners and third parties, which can lead to costly rework.
- The vendor may not have the critical size to provide disaster recovery and business continuity planning to respond quickly to unforeseen circumstances.
On the other hand, investing in current technologies reduces risk, and will get you to the expected service level, but might not put you ahead of the game.
Dealing with the Challenges of e‐Commerce and Omnichannel
Consumer behaviors are constantly evolving and the lines between traditional retail, e-commerce, and omnichannel are blurring. Your customers demand a seamless experience regardless of the channel they choose.
This evolution towards omnichannel and e-commerce must be as seamless on the operational side as the customer experience. The problem is that connecting the technology solution is not enough to make it work. You also need to plan for adapting your processes throughout the supply chain.
Managing risk aversion
Automation is expensive, and it's a long-term investment. It is therefore important to assess whether you are willing to wait months or even years to see the first results on your bottom line. For this very reason, initial capital can be hard to come by. However, for the sustainability of your business, you'll need to find a way to adapt your logistics organization to volatile demand, changing buying patterns, and your own business growth.
So, if your automation project is too expensive, too risky, and the return on investment is too slow, you need to transfer the risk.