Executive Briefings

What Does the DC of the Future Look Like?

Analyst Insight: The distribution center is taking on greater importance as a driver of growth and profitability. Top companies are investing in distribution operations to drive competitive advantage and gain market share. Many are leveraging today's technology to prepare for the distribution center of the future. But there is a next wave of technologies on the horizon - from wearables to mobile manufacturing to the Internet of Things. And the tipping point for these technologies is near. - Nikko Pianetto, Group VP of Integrated Technology Solutions, Fortna Inc.

What Does the DC of the Future Look Like?

If you want to know what's coming, focus on trends and enabling technologies. Here are four to watch:

3D Printing. Customer expectations for personalization and mass customization could drive us to bring manufacturing into the store itself. 3D printing is essentially manufacturing on demand, and could change the way we think about inventory and assortment. There is a 3D printing factory at the UPS Worldwide Hub, making it possible to print and deliver products anywhere in the world overnight. Today, there are 70-plus materials for 3D printing, including carbon, fibers and metals.

Wearables. Wearables are taking over the consumer market, fueled by smaller, more powerful processors and better quality displays. In the DC, employees have been using wearables, voice-recognition, wrist-mounted RFID, etc., for some time. But what happens when you combine that with advanced vision systems? Wearables really improve productivity once we have full-spectrum augmentation. With current glass technology, data is visible in a portion of the visual field. But once information can appear anywhere in the vision field, arrows displayed on glasses might guide pickers to the best pick path, then indicate the location of the item, then show a number to be picked – all in the heads-up display. A camera in the device, seeing what the picker sees, checks accuracy. We’ll see wearables proliferate in the DC; watches that direct tasks, shoes that vibrate to indicate direction, exoskeletons to help with heavy lifting.

Robotics. Improvements in vision systems (sensors), information processing and machine learning (intelligence) and precision mechatronics (movement) are changing the way we look at robotics. Robots that can see, think and act precisely are capable of a wider range of tasks. When combined with a robot’s accuracy, consistency and capacity for uninterrupted work with zero ergonomic considerations, you get real productivity gains. Today, robots load and unload trailers, palletize/depalletize, and move products via automated guided vehicles. But we are beginning to see robots capable of “each picking” with vision systems that allow them to adapt to changes and determine the best way to pick up and handle uniquely shaped items.

Internet of Things. Imagine a self-managing DC where objects and systems -- using real-time data about location, speed and planned route -- interact to redirect resources in real time. They could avoid or eliminate bottlenecks, and sequence tasks based on order service requirements and cut-off times. IoT will create an explosion of data which will be a jackpot for companies that can leverage it through analytics and use the information to make better decisions.

The Outlook

We’re moving toward the self-managing warehouse where automation and robotics are augmented by a handful of people equipped with wearables. That changes how we design and where we locate facilities. DCs run by robots require a smaller footprint (narrower aisles, smaller parking lots, breakrooms, and restrooms). You can build vertically on smaller parcels, making it affordable to locate closer to urban centers where customers live. 3D printers onboard delivery trucks. It’s all possible – and coming in the near future.

If you want to know what's coming, focus on trends and enabling technologies. Here are four to watch:

3D Printing. Customer expectations for personalization and mass customization could drive us to bring manufacturing into the store itself. 3D printing is essentially manufacturing on demand, and could change the way we think about inventory and assortment. There is a 3D printing factory at the UPS Worldwide Hub, making it possible to print and deliver products anywhere in the world overnight. Today, there are 70-plus materials for 3D printing, including carbon, fibers and metals.

Wearables. Wearables are taking over the consumer market, fueled by smaller, more powerful processors and better quality displays. In the DC, employees have been using wearables, voice-recognition, wrist-mounted RFID, etc., for some time. But what happens when you combine that with advanced vision systems? Wearables really improve productivity once we have full-spectrum augmentation. With current glass technology, data is visible in a portion of the visual field. But once information can appear anywhere in the vision field, arrows displayed on glasses might guide pickers to the best pick path, then indicate the location of the item, then show a number to be picked – all in the heads-up display. A camera in the device, seeing what the picker sees, checks accuracy. We’ll see wearables proliferate in the DC; watches that direct tasks, shoes that vibrate to indicate direction, exoskeletons to help with heavy lifting.

Robotics. Improvements in vision systems (sensors), information processing and machine learning (intelligence) and precision mechatronics (movement) are changing the way we look at robotics. Robots that can see, think and act precisely are capable of a wider range of tasks. When combined with a robot’s accuracy, consistency and capacity for uninterrupted work with zero ergonomic considerations, you get real productivity gains. Today, robots load and unload trailers, palletize/depalletize, and move products via automated guided vehicles. But we are beginning to see robots capable of “each picking” with vision systems that allow them to adapt to changes and determine the best way to pick up and handle uniquely shaped items.

Internet of Things. Imagine a self-managing DC where objects and systems -- using real-time data about location, speed and planned route -- interact to redirect resources in real time. They could avoid or eliminate bottlenecks, and sequence tasks based on order service requirements and cut-off times. IoT will create an explosion of data which will be a jackpot for companies that can leverage it through analytics and use the information to make better decisions.

The Outlook

We’re moving toward the self-managing warehouse where automation and robotics are augmented by a handful of people equipped with wearables. That changes how we design and where we locate facilities. DCs run by robots require a smaller footprint (narrower aisles, smaller parking lots, breakrooms, and restrooms). You can build vertically on smaller parcels, making it affordable to locate closer to urban centers where customers live. 3D printers onboard delivery trucks. It’s all possible – and coming in the near future.

What Does the DC of the Future Look Like?