Imagine what it would be like if you always read with perfect accuracy or automatically knew the quickest route from A to B. These are the advantages that wearable technology is giving warehouse workers as they don the latest in smart glasses, belts and watches.
DHL, the global logistics business, announced last year that it had measured a 25 percent efficiency increase by using Augmented Reality (AR) glasses in a warehouse trial in the Netherlands. Staff involved in picking items to be sent out to customers were given the special lenses and monitored while they carried out 9,000 orders over a period of three weeks. Not only did the employees work much faster but the orders they fulfilled were “error free”, according to DHL.
The glasses read bar codes, enabling picking staff to be sure they have selected the right item and placed it in the right location. Packing becomes more efficient because the warehouse workers are informed – through a panel on the glasses – of the most efficient route through the aisles to get to each item and are then pointed towards the optimal spot to place it within their packing trolleys.
Smart glasses – along with smart watches – are the main wearable devices that the logistics sector is likely to use in warehouses. But only 6 per cent of respondents to a JLL survey, The New Industrial (R)evolution, are currently using them along with other forms of AR.
Jon Sleeman, JLL Director of EMEA and UK Logistics & Industrial Research, believes, however, that take-up will rise significantly within the next five or six years. “Companies need to be looking at the new technology and embracing it as an opportunity to secure cost reduction and increase efficiency,” he says.
Preparing for the Fourth Industrial Revolution
Mastering the use of high tech glasses, belt scanners and other gadgets will also help the logistics sector prepare for the Fourth Industrial Revolution, the high-tech transformation which will bring in the Internet of Things. And, technological change will be one of three trends, along with globalization and urbanization, that “will have the most significant impact on supply chains and logistics property demand over the next 5-10 years”, according to the JLL report.
As is the rule in logistics, the full benefits of wearable tech will only be achieved by closely examining how the devices will fit into the physical environment they’re used in. Even ensuring that all parts of a large warehouse receive broadband at sufficient strength to connect to the wearables could be a challenge. “You’ve got some pretty challenging conditions to deal with in warehouses,” says Sleeman. And battery life for the gadgets might not even last one full shift if they are used in chilled or freezer areas, for instance.
The big data made available by wearables will also help to maximize productivity in the large, uncluttered spaces which characterize the best designed warehouses. Data from smart watches will be used to show how many paces the picking staff are making; and it will be analyzed to see if a different layout of the stock would reduce the distances covered. One of the aims of effective picking designs is to reduce the amount of time that pickers spend in walking the aisles.
Similarly, big data analysis of which items are being ordered will allow more efficient positioning of the products along the aisles.
E-commerce drives warehouse change
The growth of e-commerce and online retail has been a critical factor in the “robust demand” experienced in European logistics property markets over the last five years – at a time when economic growth was generally sluggish, according to JLL’s New Industrial (R)evolution report.
As technology develops and shorter delivery times become the norm in consumer-centric supply chains, e-commerce is driving the need for the greater accuracy and efficiency within warehouses, according to Sleeman. “Picking is a lot more demanding in e-commerce as orders tend to be made up of a number of single items not pallet loads of one product,” he says. “On top of that, a mistake in e-commerce is visible to the customer who will receive the wrong products. In traditional retail, the customer won’t know that an outlet received an incorrect order.”
At DHL, for instance, the success of its wearables trial is being seen as a stepping stone to more applications, not as an end in itself. As Dr Markus Kueckelhaus, Director DHL Trend Research, says: “In the future we see augmented reality also playing a role in other parts of the supply chain.”
Indeed, logistics is set to play a role “at the forefront of retail, as the distinction between warehouses and shops blurs,” JLL research suggests. ‘Dynamic pricing’, for instance, allows retailers to change prices on items at any time – with the decisions often being linked to knowing exactly how many items they have in stock. Air tickets have gone this way and e-commerce could follow, Sleeman believes.
The one strategy which few logistics organizations will follow is doing nothing. “You underestimate the technology at your peril,” concludes Sleeman.