When you click the “Order Now” button online, do you ever pause to consider how many steps go into bringing that product from the warehouse to your doorstep?

Thanks in part to Amazon Prime, 2-day shipping has now become a standard consumer expectation. Customers expect near-instant gratification when they click the “order now” button on a website. To compete in eCommerce, companies must meet these speed-to-delivery expectations– and the cost to do so is rising. Retailers spend 18 cents out of every revenue dollar generated online to meet these shipping expectations, and the cost to do so is rising, according to the JDA PWC Annual Retail Study. But last mile delivery costs are more than just shipping logistics. Additional considerations include warehouse packaging and goods movement within the warehouse, such as operating a forklift or performing repetitive tasks on a processing belt to package goods.

How AI and Automation Lowers Costs for Last Mile Delivery Paths

New AI-powered automation solutions are helping companies achieve continuous improvement and lean manufacturing goals by streamlining the last mile delivery path and ensuring a safer, more efficient supply line:

  1. Predicting location shipment. Before you even click an “Order Now” button, eCommerce providers like Amazon are using AI to identify the warehouse that will ship the item and how the shipment will make its promised delivery window. This efficient processing and delivery allows for more purchases, and using artificial intelligence is key to predicting which location will ship the item.
  2. Streamlining warehouse operation. Automation changes to the workforce are also benefiting companies, both in terms of labor costs and employee safety. One company I work with has eliminated the need for employees to operate a forklift, shrink wrap goods, or pick from the warehouse. Removing the human factor reduces labor costs and also lowers the risk of injury, industrial accidents, and workers’ compensation issues. Machines have more stamina than people and are able to perform repetitive tasks for long periods, without getting tired, making errors, or needing a coffee break.

 

Hiring the Right Process Improvement Talent

AI-powered automation is transforming manufacturing with new cost saving efficiencies.  However, companies must still address process inefficiencies for these technology implementations to be successful.

For example, one company we work with runs a 24/7 operation that’s also facing a growing, year-on-year financial shortfall. Before they can implement AI advancements, they need to address process concerns first, improving efficiency and cutting costs. For this company, the right hire will be a continuous improvement black belt, someone who understands lean manufacturing and can introduce Kaizan principles into their operations. Similar scenarios are playing out at manufacturers across the US. Before AI technology can be implemented, processes challenges must be addressed.

In addition to computer and robotics professionals, I look for leaders with the following skills:

  1. Continuous improvement project managers and program managers. These hires examine the overall operation and find ways to improve and streamline existing processes.
  2. Operational specialists. These hires focus on supply chain logistics. Six Sigma Black Belts and Green Belts are in demand as more companies strive to operate a 24/7 business. Lean manufacturing and Kaizan principles gleaned from Toyota’s management model are making manufacturing more efficient, and companies need operational specialists who can help them capitalize on these disciplines.
  3. Design engineers. These hires survey the manufacturing process from end-to-end, building and integrating automated systems into the production line.

AI is changing profitability and productivity for manufacturers, but companies must first address process concerns before jumping ahead to more advanced AI applications.

Questions about sourcing the right technical talent for your business or just want to hear about what’s happening in the market? Contact us and we will get you connected with someone who can help answer any questions.

 


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