September 1, 2021

Meet eKAMI: The School that Is Changing Lives in Kentucky

Discover how people are learning key skills in robotics and CNC machining

Imagine starting work in the coal mines of eastern Kentucky five days after graduating from high school. Now imagine working in the coal mines for 30 years. You know the industry. You have developed a deep level of skill and knowledge about coal mining and running coal mines. You have a good career and worked your way up to managing mines. But then things change.

Mines start closing. You must drive 2 hours morning and night to work your 12-hour shift, 6 days a week. Sometimes your job only lasts 6 months, and the mine suddenly closes. You’ve got kids, a family. This was not what you planned. And now you don’t know what to do.

Meet Kevin Yontz, who at 49 years old went back to school to learn CNC machining and advanced robotics programming. Meet Kevin, who after 30 years of working in the mines has a new career ahead of him working at Roush Yates Manufacturing in Mooresville, SC. Meet Kevin who thanks to the Haas eKentucky Advanced Manufacturing Institute (eKAMI) has a bright future ahead of him. 

“eKAMI has changed my life. It has changed my family’s life. Thanks to eKAMI, I’m on a whole new path. It’s not easy learning a new career at 49 years old, but I’m ready. The instructors at eKAMI have given me the skills, confidence, and support I need to make this change. 

I’m not going to lie – it’s scary. I’m nervous. But I know I can do it. I’m excited to be working in CNC machining and with advanced robotics. From the coal mines to the technology of tomorrow. Who would have thought this was possible!”

Kevin is just one example of the men and women who have had their lives transformed by eKAMI. Opening its doors in 2017, eKAMI is changing life’s trajectory for many in Appalachia. 

There is no denying the real-world realities of coal mining, and the impacts it is having on the people and communities of Appalachia. These facts from a recent report by West Virginia University, titled An Overview of Coal and the Economy in Appalachia, highlight the need for change and new opportunity:

  • Coal production fell by more than 65% overall in Appalachia between 2005 and 2020. 
  • Coal industry employment fell by around 54% between 2005 and 2020. These losses were concentrated in Central Appalachia.

eKAMI Brings Opportunity to Appalachia

Kathy Walker, a 30-year veteran of the coal mining industry, saw a deep need to diversify the region’s economy, and recognized that the citizens of Appalachia have unique skills and experience. Skills and experience ideally suited to 21st century manufacturing. 

Motivated by a singular mission of “diversifying the region’s economy and identifying sustainable solutions by leveraging our uniquely talented and hard-working Appalachian workforce of today in preparation for the jobs of tomorrow,” Walker partnered with the Gene Hass Foundation to open the 40,000 square foot workforce developmentfacility in Paintsville, Kentucky to train people for new careers in advanced manufacturing, robotics, and automation. 

At eKAMI, students learn to program, set-up and operate state-of-the-art Haas CNC equipment, AutoGuideMobile Industrial Robots (MIR), Universal Robots (UR), and READY Robotics automation designed for use in a range of industries from aerospace to automotive.

“Anyone with the motivation and drive to understand something different can open the doors to a new beginning. For the naturally talented workforce of eastern Kentucky, this simply means acquiring new skills to compliment and update existing ones.  

By combining the work-ethic, multifaceted skillset, and problem-solving mentality of our people, together with cutting-edge technology, we have provided employment opportunities never before imagined. Employers in the advanced manufacturing industry from across the U.S. are recruiting from eKAMI. These uplifting, inspiring positions have changed lives in so many ways,” says Walker, the founder and CEO of eKAMI.

The Where, Who, What, Why, and How of eKAMI

Who you know and where you live matter so much in what and where your life takes you. For generations, the citizens of Appalachia knew one thing – coal. The job opportunity was in the mines. Fathers, sons, brothers, cousins, moms, daughters – nearly everyone had a career associated with the mines. 

The citizens of eastern Kentucky not only know the mines, but they are also multitalented people. 

“The people from our region are naturally skilled. We live in a bit of a remote area – so people must be self-sufficient and innovative and know how to make and fix things themselves. Working in the mines provides an additional opportunity to further hone these skills requiring knowledge in safety, electronics, mechanics, equipment operation, and more.

Over the past several years, the continued precipitous decline in demand for coal has been devastating to the region. We have thousands out of work and people are wondering what in the world they are going to do because mining and the support industries have been the economic engine of this entire area for decades. 

The initial challenge was figuring out how to harness all of this talent and what industry would be a fit for our workforce,” says Walker when talking about where the idea for the nonprofit eKAMI originated. 

North American manufacturing and industry is in the midst of a deep skills gap. The jobs are available, but companies are struggling to find, hire, train, and retain people for highly skilled jobs in advanced manufacturing, robotics, and CNC machining. 

Recent data from a Deloitte and Manufacturing Institute Study reveals that the manufacturing skills gap could leave as many as 2.1 million jobs unfilled by 2030. In fact, this study projects that vacant positions could cost the U.S. economy $1 trillion by 2030.

These findings from the May 2021 study underscore the opportunity for the graduates of eKAMI:

  • While the manufacturing industry recouped 63% of jobs lost during the pandemic, the remaining 570,000 had not been added back by the end of 2020, despite a near record of job openings in the sector.
  • U.S. manufacturers surveyed believe that finding the right talent is now 36% harder than it was in 2018, even as the unemployment rate has nearly doubled the number of available workers.
  • 77% of surveyed manufacturers say they will have ongoing difficulties in attracting and retaining workers in 2021 and beyond. 

And this is echoed by AutoGuide, which says there is a definite gap between what manufacturers need, and the skills people have. People want to work in robotics, automation, and manufacturing – but simply lack the skills to do these advanced technical jobs.

“Finding skilled personnel for manufacturing and installations can be extremely difficult, so we’ve been thrilled to find a resource like eKAMI.

Not only do we get hard-working and highly skilled technicians, but they get jobs they likely didn’t even know were possible for them while working in the coal mines.

Because people have been working in really involved industries like mining, the talent that exists in eastern Kentucky is amazing. They are creative and know how to problem solve.” 

Making a Difference with 21st Century Advanced Manufacturing Education

In 2020 we experienced the largest global manufacturing shutdown since the 1940s. Closures started in China and quickly spread throughout the world, with manufacturing and supply chain operations coming to a complete stop in April 2020.

Coupled with the already challenging times for people living in eastern Kentucky, 2020 has left a permanent mark on the lives of many. But amidst this, there was eKAMI. Rather than shutting its doors, the school did what so many people were saying companies and manufacturers had to do – it pivoted.

“Our staff saw an immediate opportunity for us to help others. We quickly shifted from CNC machining parts to 3D printing face shields for local first responders, hospitals, and nursing homes. We flipped the switch and addressed the issue at hand. The eKAMI team worked days, nights, and weekends producing PPE for the community.

Overall, eKAMI is actually putting into action what others talk about doing,” says Walker when talking about the importance of having a vision and understanding opportunity. 

The recent report by West Virginia University, titled An Overview of Coal and the Economy in Appalachia, highlights the deeper need for change in Appalachia:  

  • Total private-sector employment in Appalachia coal-mining counties has been generally flat over the past decade. The total private-sector employment in the mining counties in Central Appalachia has fallen substantially in recent years.
  • The decline in coal, coupled with heavy reliance on coal in some counties, has led to broader negative spillover effects on regional economies. Total private-sector employment dropped substantially in 2020 in not only coal mining counties but also everywhere in the nation. 

And this is why for Walker, eKAMI’s mission doesn’t stop with giving people 21st century advanced manufacturing skills – this is only the beginning. 

“We’re changing people’s lives. We’re providing an already highly skilled workforce with new skills that are changing the trajectory of their lives and, hopefully that of Appalachia forever. 

The overarching goal of eKAMI is to attract industry here to replace the thousands of coal jobs that are permanently gone. Our people have transitioned seamlessly into the world of Industry 4.0. We have the loyal, exceptional workforce – we just need the jobs. 

It’s time to diversify the economy of eastern Kentucky by attracting industry to the area. We’re truly sitting on a goldmine of a talented, exceptionally skilled, innovative, and motivated workforce,” stresses Walker.

Discover the eKAMI Robotics Center

The catch-22 of U.S. manufacturing is not having enough people to fill jobs nor the people to program and operate the robots and automation that can help fill the labor shortage. 

The new eKAMI Robotics Center opened in June 2021 in response to the need for robotics programmers and engineers. By training already highly skilled people on how to program, operate, and work with robots and automation, eKAMI is making it easier for manufacturers to capitalize on automation and manufacturing 4.0.

The new robotics center is supported by a range of companies including:

Walker says the robotics addition to the eKAMI curriculum is the natural step forward in giving people the skills needed to help fill the labor shortage and attract businesses to eastern Kentucky. “Our students are already in high demand – with every graduate receiving impressive job offers. With the new robotics center and the additional cutting-edge skills training, eKAMI graduates are definitely the catch for employers. 

Companies are realizing that successful deployment of automation requires forward-thinking, boots-on-the-ground technicians who have been trained on the latest technology and possess skills suited for today’s manufacturing and logistics environment. We are learning by doing.”

AutoGuide reiterates this sentiment, saying with the skills taught at eKAMI, people are being retrained to do the exact jobs we’ve been struggling to fill. Thanks to eKAMI, we’ve been able to fill a number of jobs with highly experienced and confident people. 

These eKAMI graduates are working as robotics technicians, deploying and maintaining our modular mobile robots at customer sites. It’s a win-win – we’re able to hire skilled personnel for manufacturing and installations, and people are getting high-paying, interesting, 21st century jobs that will last.

Agility, pivoting, resilience, looking forward, and learning from the past are constant themes for manufacturing and industry – particularly since 2020. The idea that people need to always be learning and the value in staying up to date with technology, to be ready for what comes next is not lost on coal miner turned CNC machining and robotics specialist, Kevin Yontz. 

“My youngest son was working in the mines and now because he went to eKAMI, he can get out of the mines. Now, he’ll have a good, solid career. I feel better knowing that he won’t be wasting his time chasing jobs in the mines. 

It’s exciting that we’ll both be working at Roush Yates Manufacturing. To think we’ll be working on everything from engines for NASCAR to parts for SpaceX and rockets – this is huge. I’m turning 50 and I’m so humbled by the opportunity to restart my career. This is all thanks to Kathy Walker and the instructors at eKAMI.”

This is the first of a two-part series on eKAMI, the skills gap, reshoring, and automation. Our September blog looks at how eKAMI is helping companies fill the skills gap, solve the labor shortage, and alleviate supply chain challenges. 

July 28, 2021

Sustaining a Lean Supply Chain in 2021 and Beyond

Strategies for continuous improvement of supply chain agility and growth

Never before has so much attention been given to supply chain agility and resiliency. Today, everyone is talking and thinking about the supply chain.

Whether it’s the cost of lumber, the delays in deliveries of new home appliances, the slowdowns for automotive manufacturers due to chip shortages, or the limited selection of bicycles and other outdoor gear – everyone is feeling the impacts of supply chain interruptions.

The combined forces of Brexit, the semiconductor chip shortage, trade wars and tariffs, the boom in IoT, natural disasters, labor shortages, and the pandemic have exposed the fragility of the tenuous links keeping the supply chain afloat.

There is renewed debate and question marks around lean manufacturing principles, just in time (JIT) manufacturing, and the balance between efficiency and resiliency.

Source: goleansixsigma.com

Lean manufacturing and six sigma have reshaped thinking around supply chain management, encouraging companies to focus on reducing waste, streamlining efficiencies, and cultivating a culture of continuous improvement.

While some are blaming JIT and lean manufacturing for today’s shortages in products and parts, and the general chaos in moving goods from manufacturing/assembly to distribution, it’s important to look deeper than this.

The nature of buying and selling in both B2B and B2C markets has changed dramatically in the last two years. Consumer demand for personalization and same-day delivery, and the boom in automation and IoT devices bring to light gaps in supply chain management strategies. What worked before, wasn’t necessarily broken – it just didn’t keep up with the times.

Lean supply chain practices are the way forward. But what is needed is an adjustment to how companies adhere to the principles of lean and six sigma – molding them to meet their needs and the demands of their customers. At the core of this is the value and importance of continuous improvement, contingency planning, and change management.

As this quote from Ford Motor Company Chief Executive Officer Jim Farley underscores, future supply chain resiliency starts with change:

As the industry changes, we have to in-source now, just like we in-sourced powertrains in the ’20s and ’30s,” said Farley, who has shut down half his factories and seen his dealers’ lots emptying because of a dearth of chips.

We have learned a lot through this crisis that can be applied to many critical components,” Farley told analysts last month as he announced Ford would lose half its production in the second quarter and take a $2.5 billion hit to earnings this year, citing a lack of chips. “We’re also thinking about what this means for the world of batteries and silicon and all sorts of other components that are really mission critical for our company.” Financial Times

Lean Six Sigma Supply Chain Management for Today and Tomorrow

The key for companies is finding the common ground between lean, six sigma, and the customer-driven supply chain. This is not an easy task, nor is it one that companies have been ignoring.

Stimulating change amidst high pressure situations such as a pandemic, labor shortages, floods and fires, stuck container ships, and the forced shutdown of international parts suppliers and manufacturers is a very big ask.

The good news is the five principles of lean six sigma are inherently flexible, giving companies the structure, guidance, and freedom required to enable purposeful change that shifts with the times.

  • Always be working for the customer. In today’s customer-driven market, where personalization, customization, and competition have taken on new meaning, companies cannot afford to lose sight of customer wants, needs, and challenges.

    What represents quality and satisfaction for our customers? How are our customers driving the market? How can we adapt to meet their new demands? What do we know about the technologies and market forces reshaping our industry?
  • Acknowledge your barriers to success and quality. Do not get caught up in change for the sake of change. Keep your focus on identifying key problems, risk areas, and barriers that are preventing you from delivering consistent quality and satisfaction.

    What does our research and data tell us about our gaps and areas for improvement? What are our biggest barriers and risks? How does change ensure these are eliminated? Will this change bring improvements for our customers? How can automation improve efficiency and eliminate delays?
  • Remove the inefficiencies contributing to these barriers. You cannot and should not change everything. Focus on removing inefficiencies, waste, and processes that cost you and your customers money and time. Ensure that any change in process is truly value-added. Work with a proven team who understands the challenges that come with change and the best way to strategically remove inefficiencies.

    How long does it take to get from idea to design to production to the customer? How can this process be streamlined and tightened? Where are the weaknesses that could put us at risk? Does this change still have the best needs of the customer in mind?
  • Always be communicating with your employees. Change is hard. It is critical you’re always communicating with your employees. Learn from them about the inefficiencies and gaps they deal with on a daily basis. Encourage your employees to speak up and be involved in changes to process and strategy.

    What are our employees telling us about areas for improvement? What are our customer-facing employees telling us about customer satisfaction, wants, and needs? How can we train employees on new processes and strategies? Who are our internal leaders who can help foster a culture of continuous improvement?
  • Be flexible, agile, and responsive. There is not one way to do anything. What worked yesterday likely won’t work tomorrow. Remember the lessons from the last two years and use these to reinforce a culture that can be agile, flexible, and responsive. Take advantage of the people, processes, and technology available today so you can be ready for the next disruption.

    What are the market trends? How have customer demands shifted? What technologies are available that can help us eliminate waste and streamline our processes? How can we learn from what didn’t work and apply this to new strategies for resiliency and agility? How can technologies such as automated mobile robots (AMRs) and big data bring resiliency and agility to our processes?

Supply Chain Realities and Challenges

I’ve turned down a million dollars’ worth of work in the last two weeks. Doing that, it’s hard to go to bed at night when you put your head to the pillow. I have open capacity, but I need more people.” Matt Guse, owner of MRS Machining, Augusta, GA

We’re seeing gangbuster levels of orders. But the sector has a lot of challenges, like a rise in raw material costs, supply chain disruptions, logistics bottlenecks and worker shortages.” Chad Moutray, chief economist for the National Association of Manufacturers

It was a lot easier to turn the lights out than to ramp up. Manufacturers weren’t prepared for a surge of demand in goods. They’ve been caught a bit flat-footed.” Diane Swonk, chief economist at the accounting firm Grant Thornton, Chicago, IL

These three quotes from a recent New York Times article titled, As Economy Rebounds, Manufacturers Face New Hurdles, sum up the core supply chain challenges.

Across every sector – manufacturing, hospitality, travel, health care, education, and technology – companies are operating within a fine balance. Success and survival are directly linked to readily available people, products, knowledge, and demand.

Consider these three examples of disruption to people, products, knowledge, and demand:

Lean supply chains did not cause these disruptions, rather it was the accumulation of mounting pressures that ultimately caused the breakdowns and interruptions.

  • With an estimated 2.3 million women leaving the workforce due to the pandemic, the pre-pandemic labor shortage was exacerbated.
  • 5G, IoT, the surge in mobile technology in the automotive industry, and semiconductor chip manufacturing capacity operating at full capacity meant there was zero room to respond to increasing demands or to rebound quickly after forced plant closures.
  • Customer demands for personalization, same-day delivery and the rise in ecommerce triggered a change in what customers value most. The pandemic then caused a change in buying patterns – shortages of swimming pools, lumber, appliances, toilet paper, and hand sanitizer – and a lack of workers. These factors coupled with new health and safety requirements, and the grounding of distribution links, meant very few companies were able to respond quickly and efficiently to this surge in chaos. 

There is opportunity within these challenges. With a commitment to continuous improvement, focusing on the customer, eliminating barriers, streamlining efficiencies, and agility – companies can recover and be ready for the next disruption.

Five Strategies for Continuous Improvement

In the peak of the pandemic there were numerous articles and discussions about how JIT and lean manufacturing were the root of supply chain challenges. However, it is important to acknowledge that too many companies are attempting to utilize JIT and lean manufacturing within supply chains strategies that are too long, have too many dependencies, and are using outdated technologies.

Ultimately JIT and lean supply chain are about giving customers what they need.

Doing this effectively demands attention to the core principles of lean six sigma and building in continuous improvement strategies that take advantage of experience, technology, and people.

  1. Always be looking for opportunity: Supply chain management is not a static process. Continuous improvement means you’re constantly looking for the barriers to success, ways to speed time-to-market, increasing flexibility and agility, sticking to a zero-errors culture, standardizing processes to ensure safety and quality, and building a supportive employee environment.
  2. Take advantage of Industry 4.0: Technologies such as IoT, 5G and 6G, automation, artificial intelligence, additive manufacturing, and 24/7 connectivity give companies the tools and insight to be responsive and agile.
  3. Streamline warehousing and distribution: Co-locating warehousing and distribution, using automation such as robots to move goods safely and securely, and redefining JIT inventory level benchmarks are just some of the ways companies can fix one of the largest bottlenecks in modern supply chains.
  4. Eliminate waste: Core to lean manufacturing is reducing waste within the supply chain. Look for ways to eliminate defects, under-utilized employees, transportation slowdowns, excess inventory, inefficient processes in moving goods, and delays.
  5. Focus on the customer: Your goal is to provide value to the customer, and the best way to do this is by optimizing quality and reducing cost. For example, use big data to understand and predict customer patterns. Use automation and machine learning to improve product quality and speed time-to-market. Technologies such as AI, analytics, robotics, and more deliver real insight into what your customers want and why they want it. Use big data to define, measure, analyze, design, and verify new products, services, and processes.

The Toyota Product System (TPS) was developed in response to the production and delivery issues Ford experienced in the 1930s and post-World War II.

And now as we emerge from a global pandemic, we are on the cusp of the next wave of change within lean manufacturing and the application of lean six sigma to supply chain management.

This is an exciting time – never before has there been the experience, people, processes, and technology available to build truly resilient and optimized supply chains. Contact us to learn more about our approach to lean supply chain management and how automation can be a key partner in your lean manufacturing strategies.

June 23, 2021

Trends in Material Handling in a Post-Pandemic Supply Chain

How material handling equipment and technology help build supply chain resilience

Delivery wait times are no longer acceptable for consumers. In B2B and B2C, the fight for consumer loyalty and attention frequently comes down to order delivery efficiency and cost. 

This puts demands on companies to continuously improve internal efficiencies to remain agile enough to adjust to shifting market demands and supply chain realities. And as many companies have learned in this post-pandemic marketplace, living up to consumer expectations is achieved, in part, with supply chain resilience.

Material handling processes and equipment are essential to an effective and cost-efficient supply chain. Simply put, you cannot have a resilient and responsive supply chain, and a profitable warehousing and distribution strategy, without a modern approach to material handling equipment, technology, and processes.  

In this article we take a closer look at material handling, discussing:

  • Shifts in the post-pandemic supply chain and what this means for material handling
  • The principles of material handling and how these drive new processes
  • Key material handling trends shaping company supply chains and customer satisfaction
  • How disruptive technologies will continue to bring changes to material handling and supply chain management

Shifts in Post-Pandemic Supply Chain Management

The supply chain has been forced into change due to COVID-19, which exacerbated the long-simmering challenges in the pre-pandemic supply chain. The pandemic shone a spotlight on efficiency gaps and heightened the demand for continuous change within the supply chain. 

If anything, we have learned that nothing is static in supply chain management – whether it’s employee retention, managing just-in-time delivery, or how goods move from warehouse through to distribution and delivery with minimal costs and resource demands – adaptation and growth are essential. 

The 2020 State of Supply Chain Logistics Report released by the Council of Supply Chain Management Professionals (CSCMP) provides some strong insight into how post-pandemic supply chain management needs to shift, and the role of material handling in regaining stability:

  • Supporting demand for surges in areas like groceries and e-commerce.
  • Reconfiguring supply chains for other sectors, like heavy industry, that have cratered.
  • Adapting to the residual effects of social distancing, including accommodating an even larger consumer appetite for home deliveries.
  • Redirecting idle trucks and distribution center capacity to the booming sectors. Companies must recognize, though, that even with their renowned agility, logistics providers cannot reconfigure all their capabilities and relationships on the fly.
  • Becoming more flexible to cope with uncertainty which will result in less emphasis on lean operations and more on optionality and inventory. 

The CSCMP report estimates the pandemic-driven recession has ended 126 months of growth, creating lasting economic challenges, and has heightened global trade tensions. 

However, the good news is that supply chain professionals are adept at change, and we have all experienced first-hand how companies have been able to rethink internal processes to ensure employee health and safety while adjusting to consumer demands for immediate delivery, and personalized or customized products and services.

Importance of Material Handling for a Resilient and Effective Supply Chain

Supply chain success is directly tied to strong material handling processes, including using the most-appropriate technologies and equipment to meet material handling demands. 

The 10 Principles of Material Handling from MHI are long-standing best practices for developing material handling processes. 

We have taken a fresh look at these, thinking about them in the context of the recent pandemic and supply chain challenges. In fact, the 10 principles of material handling speak to how and why technology, automation, and continuous growth improvements are critical to a resilient and effective supply chain.

  1. Planning: having a material handling process that works today but is also able to flex and grow as required by internal and external demands and pressures. For example, being able to adjust to changes in workplace culture and the latest available technology.
  2. Standardization: standardizing on the right technologies for the right tasks. For example using AMR forklifts through-out a warehouse and distribution center to make employees available for higher-value tasks.
  3. Work: by implementing AMRs, cobots, WMS tools, and more, material handling processes can be optimized – doing more with less, while improving productivity. 
  4. Ergonomics: utilizing automation and technology to protect employees from risk and injury while ensuring goods and materials are moved, stored, and protected efficiently. 
  5. Unit load: the pandemic highlighted the need for companies to do more with less – fast-tracking automation adoption with solutions like automated pallet moverstuggers, and complete AMR systems
  6. Space utilization: this is an ongoing concern particularly when trying to reconfigure existing facilities to meet ecommerce demands, and consumer expectations for more personalized and customized products. This has sparked a change in the role of material handling in supporting warehouse space optimization to expedite last mile delivery of products. 
  7. System: utilizing technologies including automation, 5G, RFID, artificial intelligence, and mobile devices are essential to modern-day material movement and storage. 
  8. Environment: consumers want to know the lifecycle of the goods they’re buying, underscoring the importance for companies to have clear messaging around recycling, the environment, and clean energy. 
  9. Automationautomated material handling technology is aiding in ensuring product quality, employee safety, operational efficiencies, and better end-to-end material handling. 
  10. Life cycle cost: it’s important companies do not rush to the latest technologies without first assessing the ROI and infrastructure costs, and knowing which technology fits their needs today and can grow with changing demands. 

Companies cannot overlook how material handling ensures goods and materials are moved and stored safely, efficiently, and correctly through every step of the supply chain. 

Five Material Handling Trends Companies Need to Know 

The lessons learned from the pandemic emphasize how critical material handling is in ensuring company supply chains can respond quickly and efficiently to surging and unexpected product demands, and lags in delivery and logistics. They must be ready to anticipate forces beyond their control.

These five trends in material handling speak to the evolving nature of the law of supply and demand, and the power of the consumer.

Focus on Supply Chain Resiliency

While supply chain managers have always focused on resiliency, we are seeing an increased focus on adaptability and what this means for the modern-day supply chain. 

Companies are looking at how to use people, processes, and technology to build resilience and manage sudden change. 

We are seeing an increased and accelerated adoption of AMRs, robots, automation, additive manufacturing, reshoring, co-located warehousing and distribution, and more diversified supply chains. 

The next step for companies is to review their business continuity and disaster recovery plans and admit they need to make changes to support supply chain resiliency. They can then seek out experts across a range of domains including automation, robots, technology, material handling, and human resources who can help them make effective change. 

Industry 4.0

This fourth industrial revolution is reshaping the factory floor and how we think of manufacturing and distribution. Thanks to technologies such as AI, 5G and 6G, blockchain, IoT, and robotics engineering, deep opportunities for optimizing operations are available to companies of all sizes and domains. 

AI-powered blockchains deliver supply chain visibility, transparency, traceability, and flexibility. Together these technologies can for example, give real-time traceability to a product as it moves from source through to manufacturing to last-mile delivery, or predict peak demands for skilled employees and quickly manage the hiring and approval of these people. 

When compared to 4G, a 5G network is 10,000 times faster and can support 10,000 times more traffic. 5G and 6G technology deliver improved network speed, connectivity, and reliability, making it easier for companies to fully integrate IoT sensors, automation, and robotics into their supply chain. 

This push towards Industry 4.0 is further necessitated by employee demand – people want to use the same technologies at work as they are at home and at play – we see how these latest advancements make life easier and more productive, and want them in the workplace. 

The next step for companies is to start conversations with experts in fields such as big data, blockchain, cloud, and robotics to discuss how these technologies can be used now, and what the next wave of disruptive tech can bring to material handling and supply chain management. 

People First Culture

The strength of every company comes down to their people. One of the positive side effects of the pandemic is companies increasing their understanding of the importance of their employees. 

Companies who had long-resisted remote work now understand how people in a range of roles including sales, customer service, training and education, management, and human resources can work effectively from home, and in many cases with stronger results and improved efficiency. And within factories and manufacturing centers, employee health and safety has taken on new meaning, forcing companies to rethink every aspect of their material handling processes, and how new technologies can improve workplace safety and productivity.

The next step for companies is to listen and respond to employee feedback on workplace culture, and what creates a positive and productive workplace. A people first culture is critical to enabling a resilient and agile workplace that is able to respond quickly to unexpected events and demands. 

Automation and Software Integration

Technologies such as LiDAR, SLAM software, AMRs, cloud connectivity, machine learning, and AI are making it easier for companies to bring change to material handling without risk of business interruption and productivity slowdowns.

The next step for companies is to assess the real needs of their operation, their employees, and their customers to ensure the technology fits today, and that they position their material handling infrastructure to adapt quickly to industry shifts and market pressures. 

Ecommerce Readiness

Buying and selling is happening online. Whether it’s procuring automotive parts from a supplier, ordering pallets of seasonal goods, or selling direct to consumers, ecommerce must be part of every company’s business plan. 

Many companies were forced into ecommerce sales and distribution before they fully understood how this impacted customer service, inventory management, distribution, and new product demands and releases. And while we are now seeing a return to some of the pre-pandemic models of sales and distribution, companies cannot return to their old methods of doing business – if they do, their customers will move on.

The next step for companies is to invest in technologies and knowledge throughout every phase of design, manufacturing, procurement, sales, inventory management, and distribution to ensure they can sell online today and be ready to adjust quickly to the constantly evolving ways of buying and selling. 

How Material Handling Technology Helps Build Supply Chain Resilience

A warehouse and distribution center is made up of a lot of moving parts. As you know, a break-down in any one area, however minor, can have far-reaching impacts throughout your operation.

Material handling technology in 2021 gives companies the tools and capabilities they need to mitigate interruptions, manage productivity slowdowns, strengthen their ROI, and be ready to on-board new technologies more quickly and successfully. 

In the future we will see larger scale adoption of technology such as digital twins, additive manufacturing, blockchain, and AI improve the moving, controlling, protecting, and processing of goods within manufacturing, warehousing, distribution, and delivery.

But to be ready for future material handling technology, companies must get on-board today with technologies such as AMRs, automation, cloud computing, robots, and sorting machines. 

There is always a risk with adopting new technology, but if we’ve learned anything over the last 18 months it’s that it is best to be able to control the when, why, where, how, and what of disruption. 

Contact us to discuss how AMRs and automation can strengthen your material handling processes and build supply chain resiliency for your organization. 

April 13, 2021

The COVID-19 Impact on Manufacturing, Warehousing and Distribution

How the pandemic put a spotlight on automation and robots

The global pandemic has placed a spotlight on the fragility of modern supply chains and manufacturing processes. Tenuous links in the supply chain were quickly fractured with global shutdowns and the grounding of all travel.

Already stressed relationships with international suppliers, overburdened transport systems, a lack of end-to-end supply chain visibility, and outdated processes for monitoring and responding to demand, collapsed in February 2020.

Suddenly people were told to stay home – everything closed – stores, restaurants, schools, theaters, gyms, and office buildings. And with that, everything moved online, from seniors buying their groceries with a mobile app to kids attending virtual school through to the continual scheduling of Zoom meetings.

The demand on ecommerce was staggering. If it could be bought online, people were buying it and expecting same-day delivery. Companies were left scrambling, trying to figure out how to meet this heightened demand, keep their employees safe, and continue to operate without their usual supply chain networks.

Suddenly, overnight the how and where of manufacturing and distribution changed. Every link in the supply chain needed a makeover.

How could companies meet demands while keeping their employees safe and maintaining their bottom line? Conversations about infrastructure, reshoring, last-mile delivery, regionalization, automation, staffing, and ecommerce were happening across every industry.

And now, a little over a year later, many companies have the processes, people, and technology to respond to sudden change and interruptions.

Whether it’s autonomous mobile robots (AMRs) moving pallets instead of human-operated forklifts or reshoring manufacturing and distribution or taking advantage of 3D printing of parts and cobots, companies are finding new ways to remain viable and successful.

In this article we discuss how COVID-19 has turned challenge into opportunity, giving companies the motivation to change how they think about creating, making, assembling, and delivering parts and products.

COVID-19 Exposes Challenges in Manufacturing, Warehousing, and Distribution

In 2020 we saw the largest global manufacturing and factory shutdown since the 1940s. Starting with closures in China and quickly spreading throughout the world, manufacturing and supply chain operations came to a full stop by April 2020.

While definitive numbers on the impacts of these closures on sales, employment, profit, and long-term financial viability are not yet available we do know that the damages of the 2020 shutdown run deep. For example, Accenture highlights these numbers in its State of Supply Chains report:

  • 94% of Fortune 1000 companies saw supply chain disruptions from COVID-19.
  • 75% of companies have had negative or strongly negative impacts on their businesses.
  • 55% of companies plan to downgrade their growth outlooks (or have already done so).

The global pandemic has exacerbated long-standing supply chain challenges and created new ones for all companies regardless of size and industry:

  • Lack of skilled employees: with stay-at-home orders and universal concerns about workplace health and safety, the pre-pandemic labor shortage became a deal breaker for companies. When manufacturing and warehouses did reopen, it’s been very difficult to hire skilled employees and to keep them healthy and safe while maintaining profitable operations.
  • Social distancing mandates: maintaining 6 feet between employees in any business is an expensive challenge. Installing plexiglass dividers, acquiring enough PPE for employees, refactoring assembly lines to ensure safe distancing, and managing staffing levels required to meet customer demand forced a change in almost every process.
  • Global supply chain dependence: relying on offshore manufacturing and production collapses when ships, planes, and people are grounded. Pre-pandemic orders could not be filled, container ships packed with goods were left stranded at ports, assembly lines stopped mid-production, warehouses were locked with in-demand product lingering on the shelves, and companies had zero ability to respond to new customer orders.
  • Ecommerce boom: the acceleration in ecommerce purchasing caught many companies by surprise. With people told to stay-at-home, stores closed and even with the slow reopening of retail in some areas, ecommerce has remained the shopping medium of choice. Both B2B and B2C customers prefer to do their research and purchasing online with expectations for same- or next-day delivery. This puts focus squarely on rethinking how manufacturing and distribution can become more efficient.
  • Customer purchasing demands: pre-pandemic, companies relied on traditional product forecasts based on historical purchasing data. But with the pandemic, people realized there was a shortage of goods and materials, and quickly started buying in bulk and changing when they purchased seasonal goods – causing manufacturers and distributors to scramble to meet orders for everyday items from toilet paper through to bicycles and lumber.
  • Lack of supply chain transparency and insight: a remote supply chain footprint meant many companies lacked clear visibility into production and delivery timetables. This was further exacerbated by deep dependencies on and poor communication with Tier 1 suppliers.
  • Employee health and safety: pre-pandemic, concerns over employee safety on factory and warehouse floors was a growing concern. With 34,900 people per year suffering severe injuries in forklifts accidents, moving materials was already a risky business. Couple this with the unknowns around coronavirus transmission and people’s fears over losing their jobs due to sickness or time off – health and safety became a key focus in manufacturing, warehouses, and factories.

These challenges are heightened further by the unknowns around how and when we will return to business as normal.

Will consumers return to in-person shopping and traditional buying habits? What is the most effective way to move goods from manufacturing to the customer? Who will staff new regionalized manufacturing and distribution centers? How can companies affordably build resiliency into operations? What is the best way to bring technology and automation into manufacturing and warehousing?

Trends in Manufacturing, Distribution, and Supply Chain Management

The COVID-19 pandemic has forced a wholesale change in how companies operate. This is a good thing. While change at any level is difficult, the changes spurred by the global pandemic have added stability to a precarious supply chain and allowed companies to strengthen their operations at all levels from design, production, packaging, and distribution.

Ideas or processes that were in the periphery pre-pandemic have now become key benchmark trends for companies who recognize that returning to the before times is not a viable option:

  • Additive manufacturing: 3D printing or additive manufacturing makes it easier for companies to affordably produce and deliver parts on an as-needed basis. This shift in manufacturing can decrease warehouses stocked with outdated parts and reduce dependencies on suppliers to manufacture and deliver parts.
  • Automation, robots, and AMRs: people are seeing first-hand how AMRs and automation can alleviate labor shortages, mitigate workplace health and safety concerns, and reliably manage same-day delivery expectations. AMRs give companies the freedom to reallocate skilled workers to more value-added tasks while reducing safety liabilities and increasing throughput efficiency.
  • Reshoring: while domestic manufacturing was moved offshore in an effort to combat production and labor costs, this has ultimately proved to be a costly strategy. Reshoring of manufacturing not only protects against future shutdowns, but it also allows companies to meet consumer demands for buying local. The ease-of-access to technologies such as AMRs, automation, and robots means companies can return to domestic manufacturing while keeping costs down and increasing skilled jobs for employees.
  • Co-located manufacturing and distribution: the essence of business is quick, accurate and efficient operations. And this speed and accuracy of material transport and storage is even more critical with the shift to ecommerce and same-day delivery. Companies who can bring manufacturing and distribution together and bring 3PL to distribution centers can adjust their business models to meet production volumes and delivery demands.
  • Diversified supply chains: continuity, flexibility, and agility are not buzz words for companies who want to remain in business – they underscore the need for change in supply chains. A diversified supply chain takes advantage of the latest in automation, IoT technologies, digital communication, omnichannel purchasing and sales, and AI to maximize efficiency and resiliency.
 

AMRs, Automation, and the Continuity of Business

COVID-19 reminded us of the importance of business continuity and recovery. New business demands require new ways of operating and thinking about how work gets done.

And this is where and how AMRs help companies adjust to the new normal, and remain prepared for what comes next.

  • Mitigating labor shortages: AMRs allow you to free employees from repetitive and risky tasks, allocating them to value-added and more interesting roles, thereby improving job satisfaction, reducing injury risk, and creating a more efficient workplace.
  • Improving workplace health and safety: AMRs mean fewer vehicles, predictable paths, robust safety features, easier-to-manage social distancing, and less human error.
  • Increasing throughput efficiency: eliminate delays in replenishing raw materials, prevent costly bottlenecks, and increase operational and throughput efficiency. 
  • Better material transport and storage: optimize how you move materials from manufacturing to distribution and delivery with intelligent AMRs designed to automate high payload material movement and work collaboratively with employees,
  • Improved product quality: eliminate human errors that cause damaged goods, unnecessary waste, and misplaced inventory.

AMRs and automation alone do not solve the very real-world challenges in supply chains, manufacturing, and distribution.

However, robots and technology do make it easier for companies to react, respond, and remain viable in the face of new business demands, economic uncertainty, and shifting consumer expectations.

Your operational needs today are very different from what they were in January 2020.

One of the core principles of an effective AMR deployment is remaining flexible and being able to grow and adapt as needed. And this holds true for every aspect of your manufacturing, distribution, and supply chains operations.

Contact us to learn how AMRs and automation can help you build a more resilient and responsive operation for today and tomorrow.