Overcoming Challenges in Warehouse Automation Implementation

Warehouse Automation Challenges – The Honest Truth

What exactly makes automation projects so challenging?  Is it the technology, the sheer scale, the high associated dollars?  In short, it’s all these things, and more.  By their very nature, automation projects live on the cutting edge of technology and project management methodologies, where virtually all projects have some emergent aspect to them that has not been done before in precisely the same way.  For this reason, automation project managers must be thoroughly familiar with the expectable issues that these projects bring forth, while also being cognizant of where the unexpectable issues will hide.

In these types of discussions, we do not see the business and project management aspects covered nearly enough.  Understanding the technical components of an automation project is certainly valuable, but if those technical facets cannot be implemented in a way that expressly meets the project’s business case, the project may be doomed from the beginning.

This is where we find the largest failures in automation projects to stem from – poor planning, incorrect priorities, and insufficient big-picture integration.  Worse, these types of issues are overwhelmingly missed until far too late in the project.  Luckily, this observation also provides us with a path to resolution.  If project managers can incorporate a few more critical factors into their planning processes early on, most warehouse automation implementation challenges can be addressed before they occur.

Critical Planning Factors in Warehouse Automation Implementation 

Automation implementation issues tend to manifest in several ways such as compatibility problems, scope gaps, cost creep, scheduling conflicts, and adoption pushback. In our opinion, nearly all types of issues can be mitigated in part or in full by being thoroughly factored into a project plan upfront in the following ways:

• Quantify the Project’s True Objectives – at its end, every project gets measured against its original objectives and then deemed successful or unsuccessful.  Most often, these objectives get written at a technical level (such as “add 5,000 pallet positions” or “increase rates to 500 picks per hour”).  In this way, the project’s true organizational goals are entirely missed.  To avoid this issue, project managers must quantify the true goals that fundamentally matter to the business (such as “cut operating costs by 5%”), so that all project activities and results can be directly measured against the metrics that matter most.
• Document Owner Priorities and Requirements – carrying on with the above concept, true project goals can only be achieved if they are documented and broadcast across the whole project team.  In addition, goals and requirements must be prioritized early on, as all requirements will come with cost trade-offs.  We recommend that a written Project Charter or Owner’s Requirements document be published for this reason, as it will serve as the “law” that the project must follow through completion.
• Perform Ample Due Diligence – another common cause of project failure is having unexpected surprises spring up past the project’s point of no return.  These surprises are often external to the core automation scope, and so they go unassigned to a responsible party and therefore undetected.  Project managers should plan a sensible due diligence investigation period before committing full capital dollars, covering risk points such as vendor solvency and capacity, building code restrictions, existing infrastructure capacity, logistics network cost modeling, labor market capacity, and existing equipment compatibility.
• Conduct a Technology Forecast – if anything is true about automation projects, it’s that these technologies can change in the blink of an eye.  Most warehouse automation projects have a moderate to extended time horizon – software deployments may take three to twelve months, and full-scale AS/RS installations might take two to three years.  During that time, technologies will upgrade, industry norms will evolve, price points will ebb and flow, and regulatory standards will expand.  Even worse, some technologies may be obsoleted entirely before the project is delivered, causing very painful pivots deep into the job.  Project managers should perform a technology forecast to understand where project decisions today may measure against conditions tomorrow, primarily to avoid hidden future costs and compound risks.
• Budget Both Vendor and Owner Contingencies – while contingency planning is a normal project management practice today, we still see project managers struggle to properly allocate contingency to the risk factors on their specific jobs.  We suggest splitting contingency into two buckets:  costs stemming from vendor changes, and costs stemming from owner changes.  Using these buckets, project managers can properly allocate funds to the appropriate party and avoid assumptions that one or the other party has a change factor covered when they do not.  For example, vendor contingency should cover things such as material and labor price increases, whereas owner contingency covers things such as add-scope requests and direct regulatory fees.
• Assess Digital Preparedness – practically all warehouse automation projects today contain at least one element involving a business’ IT infrastructure, whether it be accessing on-premise assets (such as an inventory database) or external hosted data systems (such as a cloud-based analytic portal).  By conducting a digital preparedness assessment, project managers can determine how ready their business’ data systems are for handling the new automation project, from network protocol compatibilities to server access licenses, cybersecurity posture to physical wiring integrity, and much more.
• Establish a Phased Commissioning and Deployment Plan – many project managers associate the design of the automated solution itself with the project’s likelihood of success, but even a “perfectly” designed solution can be rendered a failure by how it is deployed.  With this in mind, we urge managers to plan with the end of the project fully in mind by developing a detailed commissioning and deployment plan.  A properly phased deployment plan commissions the project in digestible chunks, where issues can be contained and resolved with limited risk to the overall system.  Further, this plan should measure and translate technical metrics into business metrics, allowing for direct comparison to the project’s business objectives as we outlined in our first point above.
• Deploy with Confidence – in many ways, deploying a warehouse automation project begins the day that the project is chartered.  Project managers must be ever mindful of the impact that a project will have on the organization’s culture, personnel, outside vendors, and stakeholders.  Managing expectations across these fronts is a job unto itself, requiring diligent actions such as open communication, applied change management, proactive workforce development, and positive reinforcement.  Some technological solutions can also help, with simulated startup and virtual training being the most common.  In all cases, the goal is to get the organization ready for deployment well before the go-live date, so that everyone involved embraces the change as it’s brought online.

While our commentary here has been very high-level to address warehouse automation project management topics, we are by no means downplaying the importance of the nitty-gritty technical details involved.  Our goal has been to convey the value of establishing a solid plan for any given warehouse automation project from the start, one that accounts for and is ready to handle the challenges that will inevitably arise.  With such a plan in place, project teams will spend less time reacting to high-risk surprises and more time creating a wonderfully engineered solution that will inspire future projects to come.

MH Equipment is one of the largest material dealers in the United States, with 30 + servicing locations and over 1,000 employees serving customers in 10 upper Midwest and Eastern states. Our mission is to deliver exceptional service in material handling equipment sales, service, rental, certification & training, and engineering. From complete fleet management to warehouse design, vehicle sales to roadside response, our experts are here to serve your needs. For more information email us here.