Craig Henry, U.S. industry manager of intralogistics with Siemens, discusses the continuing labor shortage, inflationary pressures and the need to invest smartly in technologies.

A lot is happening in logistics and intralogistics, in Henry’s view, but there are a lot of confusing messages. On the negative side, short-term venture capital is down, which is not what startups want to hear. On the positive side, the robotics and automation market is “absolutely exploding” because of the labor gap.

In the short term, he says, smart companies will invest. In the medium term, the supply chain crisis will likely continue through 2023. However, Henry says, “I think we'll be seeing daylight in 2024, quarter one, and that will be the time for what we have planted to grow and flourish in the automation space.”

At the moment, labor continues to be the industry’s biggest challenge. The so-called “COVID-19 paradox” saw the convergence of baby boomers leaving the workforce and a “culture that is moving away from work.” 

He thinks those who can’t or won’t invest in automation to fill the worker gap will fail. “It will cull the herd, and those who are great are going to do better. I also think it's important to note that with this labor gap, throwing money at the problem hasn't solved it. We're going to have to be smart about technologies that make automation happen.”

Since no one size fits all, companies need to decide what they want their customer service level to be. “Do the math and figure out where it is that you can improve your organization,” Henry says. “Make it higher efficiency where you need to automate. Then, secondarily, you want to essentially strategize before you digitize. Get your strategy straight, and then come to the marketplace and find the technologies to accomplish that.”