In the logistics and supply chain industries, every edge counts. That’s why facilities managers and decision makers everywhere are exploring the benefits of automated material handling. This group of technologies can bring new levels of productivity, safety and profitability to these important verticals.

1. Higher-Value Jobs

When people talk about automation, they focus most of the time on the potential displacement of human workers. In reality, automation is a complement to human effort – and companies that navigate the transition to selective automation well often don’t have to lose even a single employee.

Rather, it’s the roles of those employees that are changing. One automotive parts company in Illinois discovered that automation helps move employees into higher-value, higher-paying roles and ends up leaving the repetitive tasks like quality management to the more capable “eyes” and “ears” of automated inspection equipment.

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2. Better Access to Data

Before automation became more widely available, the various work areas and pieces of equipment within an industrial setting represented islands of process data. But thanks to connected automated systems, logistics experts, facilities managers and other industry professionals have access to many types of data they didn’t have before.

Crucially, this access allows those systems to communicate with one another, too. When a connected conveyor system in a distribution center can adjust product flow based on surrounding conditions, including maintenance items, it means machines and workers alike can react accordingly. The various parts of a facility are able to use the information to plan ahead to anticipate changes and delays.

3. Improved Quality Control

As we mentioned before, some of the roles being inherited by robots – including automated material handling equipment – involve inspections and quality control processes.

The concept of machine vision powered by AI has gained a lot of traction in recent years and now enjoys some of the top billing when companies start shopping around for connected material handling systems. Compared with manual inspections, automated inspection using machine vision catches more errors and cuts waste by reducing rework.

4. Better Workplace Safety

Most employers are quick to say that employee safety is one of their top concerns. But not every company means it or takes the time to find out which technologies can contribute to a safer workplace. The numbers on workplace safety incidents speak volumes.

Companies that want to improve their bottom line by improving safety and reducing the time to completion for critical tasks can do so with automated pallet trucks and even robots that pick to totes. This technology still benefits from clearly marked operational areas for keeping humans and machines from bumping shoulders. But advancements in sensors have made automated material handling ‘bots extremely safe and sure-footed. Laser-guided and LIDAR-guided automated guided vehicles are available, as are vehicles with vision sensors for a more robust view of the ‘bot’s surroundings.

Think of everything that pallet jacks and lift trucks do for you. The forklifts in your facility might hoist loads up to 50,000 pounds two dozen feet into the air. While you trust your drivers, you also owe it to them to reduce as many potential hazards as possible. In some environments, increasing user safety might mean reducing foot traffic in favor of smaller automated vehicles and ‘bots to work alongside larger human-operated equipment.

5. Higher-Volume, More Flexible Production

Automated material handling equipment can help factories and distribution centers assemble or move more products in any given period. It also helps those companies realize greater flexibility across their operations.

Supply chain and logistics managers have the means to call upon data from a central location, as well as issue new commands to automated guided vehicles and make adjustments to other connected machines on the fly. All of this makes any given facility far more flexible and better equipped to switch over to manufacturing a different product — or making another process change — without first gathering up half your workforce to get it done.

6. Faster Time to Market

All of the above factors combined make automated material handling equipment the obvious choice for any company worried about beating their competitors to the market. The idea of rapid prototyping using 3D printers is catching on for this same reason, and companies that harness both automation and 3D printing will have an unstoppable pipeline for releasing new or updated products into the world very quickly.

Think of the potential when you can have your materials moved automatically between each stage or station, and have your printers run through multiple design iterations for your inspection or testing equipment to evaluate.

According to findings by Boston Consulting Group, only around 10% of manufacturing facilities today have been fully automated. But the benefits are becoming clear. Compared with previous-generation approaches to research, development, assembly and manufacturing, introducing automation into the mix is a nearly sure way to take a logistics-heavy operation to the next level.

Of course, there are some downsides to embracing automation, including the initial investment, the learning curves and the potentially unpredictable costs. A deliberate approach is best, with a focus on identifying problems first and shopping for tech to solve it second.

Automated material handling systems reduce—and sometimes eliminate—the need for human intervention in industrial tasks. Plain and simple.

 When “touches”—human intervention—are reduced, costs are significantly impacted. These costs are often hidden, but once removed drop directly to bottom line profitability.

 It’s for this reason that increasing numbers of industrial organizations are electing to automate as a means to minimize manufacturing costs by reducing human involvement. Research, in fact, shows the North American market for automated material handling is projected to grow at a CAGR of 8.1% over the next four years to reach $7.1 billion by 2019—up from $4.8 billion in 2014.  

The advantages of automation are many: Improved production quality, improved working and safety conditions, maximized floor space, increased level of profits—the list goes on.

Let’s examine some of the driving factors for growth of automated material handling in the years to come and explore what this means for manufacturing operations:

Advanced Technologies

Increased automation isn’t a new. Boston Consulting Group (BCG) research shows roughly 10% of today’s manufacturing functions are fully automated—a number that’s predicted to reach 25% over the next decade, as robotic vision sensors, intelligence and gripping systems improve.

Indeed, robotics and automation have paved the way for more efficient, productive, and intelligence industrial operations in recent years. But that’s only the beginning. With such technological advancements comes the increasingly pervasive Internet of Things (IoT), which delivers increased data and sharing communication that Microsoft estimates could lead to as much as $90 billion in added value for manufacturers annually.

According to BCC Research analyst Lisa Marshall in a press release on the technological revolution in material handling, advanced technologies such as robotics, autonomous control, driverless vehicles, and wearable computing will be key drivers of automated material handling growth over the next 15–20 years.

“Robotics is in the midst of a true revolution as capabilities increase and costs decrease,” she says. “Although most industrial robots are currently found in manufacturing applications, they are becoming more viable for material handling and logistics applications in the future.”

Reduced Costs

 In years past, the significant expenditure associated with automation deterred many organizations from making the investment. However, as noted in a USA Today article, automation costs are decreasing as advanced robotics becomes more and more prevalent across the U.S. and globally.

“The cost to purchase and start up an advanced robotic spot welder [for example] has plunged from $182,000 in 2005 to $133,000 in 2014, with the price forecast to drop another 22% by 2025,” reports BCG research cited in the article.

What this means for manufacturers is there is an increasing incentive to automate what has traditionally been manual operations. BCG says manufacturers tend to ratchet up their robotics investment when they realize at least a 15% cost savings compared with employing a worker, according to USA Today.


As industrial operations automate, manufacturers also have the opportunity to drive safety in the warehouse. Improving working and safety conditions is one of the primary drivers of manufacturers replacing their existing systems of material handling to automated systems, as noted in a recent MarketsandMarkets blog.

“Robots are ideal for tasks that are too dangerous for humans to undertake, and can work 24 hours a day at a lower cost than human workers,” says a World Economic Forum article.

But automating dangerous or repetitive warehouse work isn’t just about putting employees out of harm’s way; it also results in increased employee satisfaction and engagement as workers pursue more value-added positions around the warehouse. Additionally, as automation increases, new jobs are created that need additional workers with specialized skills sets in programming and maintenance—particularly in light of the technological advancements on the horizon.

Final Thoughts

Automated material handling isn’t the wave of the future—it’s here now. As noted above, there are several factors fueling growth of automated industrial operations, including advanced technologies, reduced costs, and safely, to name a few.

The question to ask is: As this growth continues in the years to come, how will your company prepare itself?

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