Analyst Insight: Many executives immediately turn to automation to cut labor costs, increase facility capacity and improve accuracy, because it appears effective both on paper and in practice. Before automating, however, it’s essential to evaluate whether you’ve truly maximized your current processes, space, equipment and systems, or if other improvements might better help you reach your goals. And if the current state is optimized, are you really ready for automation?

Some 60% to 80% of U.S. warehouses still rely on manual operations, though automation is rapidly gaining traction. Automation is attractive but, before deciding it is the right next step for you, consider whether you've maximized your current operations.

The factors to consider when deciding whether to automate include:

Processes. Assessing current processes and identifying bottlenecks can reveal ways to boost labor productivity. For example, batch-picking lets you fill several orders at once, unlike discrete order picking. Process improvements alone can boost at least 25% in labor productivity.

People. Improved training on processes and exception-handling boosts performance. Update standard operating procedures and provide formal training. Including warehouse teams in documentation increases ownership and streamlines adoption.

Systems. Directed warehouse system activities boost labor productivity and storage density. Optimized operations like stocking, replenishment and picking enhance speed and accuracy. Consolidation promotes improved storage use, while task interleaving increases efficiency in related tasks like stocking and retrieving pallets. Integration with existing systems is an essential step for transitioning to automation and implementing necessary controls.

Data. Accurate and reliable data is essential for effective warehouse system enhancements and automation. Item master data enables efficient warehouse management and automation. Without precise item size and weight information, operators cannot use directed put-away or consolidation features, and automation often fails.

Travel. Reducing travel distances within a distribution center, whether walking or operating a forklift, can offer significant labor savings. The goods-to-person concept highlights this by minimizing walking during the picking process. There are also several manual methods to decrease travel without requiring investment. One approach is to evaluate warehouse zoning strategies, positioning faster-moving items closer to the dock and slower items further back.

Aisles. Maximizing inventory in limited space is key for automation. Aisles can be narrowed to under five feet, and storage heights extended up to a hundred feet. But manual systems also allow for narrower aisles and higher rack storage. Very narrow aisles (VNA) — under six feet — use turret trucks, and are commonly compared to traditional automated storage and retrieval (AS/RS) setups.

Equipment. Many warehouses use single-deep pallet rack and shelving and may be considering automated solutions. There are several conventional storage and material-handling equipment options available before automation. Different racking structures, such as push back, pallet flow, carton flow and platform structures can address requirements for density and labor efficiency.

Building. Existing warehouse buildings are equipped with power suitable for standard material handling and storage equipment, as well as a structural slab intended for conventional rack equipment. Automation may necessitate additional power and enhancements to the structural slab.

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Outlook: Warehouse automation often sells attractive technology, but without solid processes, automation only speeds up costly mistakes. Focus on process discipline first over equipment investment, and consider traditional solutions before adopting automation. Streamline processes, optimize equipment and space, create accurate data and make full use of existing systems. Then, scale the efficient operation with automation to optimize your return on investment.