Levelling the playing field: Warehouse technology

Seamless operations and technology have become synonymous for warehouses, according to the service providers implementing these strategies.

It is said that over the next decade, several trends will noticeably affect warehouses and distribution centers. New developments will change the way work is accomplished— and that has already happened to a large extent. Today’s warehouses have transformed from what they were a decade or two ago, with the fundamental factor behind this transformation being technology.

Today’s warehouses are not just about serving as simple storage points. They are distribution or fulfillment centers, focused on the rapid movement of product in as few touches as possible. Popularity of technology like automatic guided vehicles (AGVs), robots, Big Data, and warehouse management systems (WMS) continues to rise in warehouses ensures that operations notice a variety of benefits—from a decline in errors and costs, to a rise in picking accuracy—as they strive to improve operations and enhance productivity.

Al Naboodah Group Enterprises (ANGE) is one of the UAE’s largest and most respected family-owned conglomerates with a diverse portfolio of business. In 2016, the various businesses owned by Al Naboodah were brought together under the ANGE banner and this had a direct impact on Abdelkader Al Seidawi, ANGE Warehouse & Logistics manager.

Al Seidawi explains: “Until that point, I mainly looked after Swaidan Trading goods, such as Hyundai batteries, Goodyear tyres and batteries, and heavy goods such as forklift trucks, but when we consolidated the businesses, I was then in charge of all the Gulf Oil products and Al Naboodah Electrical products, including SMKA Electric.”

SMKA is a leading provider in the industry, supplying premium electrical, lighting and home automation products. With a large portfolio, the company represents a number of global brands including Dulight, MK by Honeywell, and OBO Bettermann. Al Naboodah’s electrical arm also branches out globally with Al Naboodah Technologies in Saudi Arabia. In addition, Al Naboodah Electrics launched its own brand of eco-friendly LED lighting solutions called Lumez.

Al Seidawi continues: “In any given month, I am responsible for ensuring over 1,000 SMKA products are delivered and safely received on time to customers all over the UAE and beyond, while also ensuring that over 900 Swaidan Trading goods are also delivered on time. This ensures that all 20 of our trucks are out delivering all day, every day.”

It is clearly a huge undertaking, with between AED120-150mn worth of stock in his warehouses at any time. Repeatedly awarded the ‘Best Distributor in the Middle East’ for MK products by Honeywell, SMKA Electric has an enviable reputation in the region as one of the most reliable companies to work with, and this is in no small part due to the efficient managing of stock through the warehouses. These products are supplied to most major contractors in the region, as well as over 300 sub-dealers, and to end-users through eight showrooms across the emirates.

The warehouses themselves are vast. At the Al Naboodah warehouse in Al Qusais, the site spans over 17,651sqm, while the Al Awir site covers about 25,540sqm. Keeping track of all those goods and deliveries is clearly not an easy task. According to Al Seidawi, it is done via an enterprise resource planning (ERP) system called Epicor.

He explains: “Before we had Epicor we used JDE [JD Edwards] as our ERP system but it wasn’t meeting our needs, so we upgraded to a new ERP system. This system has a very high degree of automation and minimises manual transactions. Before that, we had to fill in the data manually via an Excel spreadsheet. That is how we kept track of stock in and out.

“With Epicor, it is all fully automated through the system, from the delivery coming in to the delivery going out. We are able to monitor stock levels and track where stock is going. When any item is low, an automatic email report is sent out to that business unit to alert them, so they can reorder. We are also in the process of getting barcode scanning installed, which will be an even faster and more efficient method of stock taking.”

Stock taking is not the only area where tech is deployed at Al Naboodah; the company recently took delivery of automated loading bays. Preceding this, the loading bays were adjusted manually, with considerable effort needed by those on site. Now, however, a hydraulics system is able to adjust to the height of each container with the touch of a button. This, says Al Seidawi, has made deliveries much faster and more efficient.

There is also tight security on site with a networked, linked series of cameras (CCTV), covering every square inch of the warehouse. This cabled system, consisting of over 30 cameras, is directed to a multi-screen display in the management offices.

“The company as a whole is very focused on sustainability with a sustainability roadmap, plus policies in place to support the roadmap,” clarifies Al Seidawi. “The warehouses follow suit accordingly, and where possible, conserve energy, engage in recycling, and implement other aspects of our sustainability roadmap, which also covers areas such as employee welfare, and health and safety.

“One energy conserving measure is adopting the use of power hoses to clean our vehicles. We used to use hoses attached to mains water, but we now use a high-pressure machine which saves a lot of water. Also, in our air-conditioned warehouses, where we need to keep the interiors temperature controlled, we replaced the split A/C units with high power units. They are far more efficient, and from having to use 12 split A/C units, in the same space we now just have four air-conditioning units, with only two in use at any one time. This is a big energy saving measure. It is also company policy to switch off lights and any electrics when not in use, and we have personnel who ensure this is done at the end of every working day.”

“The warehouses [where possible] conserve energy, engage in recycling, and implement other aspects of our sustainability roadmap.”

In recent news, Saudi Arabia-based Almjadouie Logistics Company deployed Infor SCE to enhance business agility as it poises for further growth. The project was successfully managed by Infor’s global supply chain partner, SNS, a provider of supply chain consulting and software solutions in the Middle East, Africa, and Europe.

A powerhouse in the logistics and supply chain industry in the region, Almajdouie has more than 4,000 employees and over 2 million square metres of terminal and storage facilities across the GCC, which move an average of 1.6 million tonnes of goods annually. As the need for increased operational efficiencies arose, the company looked to improve the flexibility and scalability of its business, and sought an integrated system that could support its current and future requirements. After a thorough and detailed evaluation, it decided to adopt Infor’s best-of-breed warehouse management solution, Infor SCE.

“Our customers’ businesses demand that we keep pace with emerging value-added services,” says chief operations officer, Brent Melvin, Almajdouie Logistics. “We can provide them with complete visibility about their inventory, enabling them to reduce freight costs, optimise service levels, and improve overall operational efficiency. With Infor SCE, we are now able to make faster and better-informed decisions, improving our customer service, increasing throughput, all while reducing the costs of running our operations.”

Meanwhile, the Logistics District at Dubai South launched Masary, a new smart electronic system that reduces the transit time of goods and vehicles. Masary is digitally connected to Dubai Police, Dubai Customs, and other relevant government departments, and is characterised by its speedy process while issuing permits, by reducing the time from four hours to a mere 10 minutes.

Nestlé and XPO Logistics are reportedly co-creating a 59,272sqm distribution centre at the new SEGRO East Midlands Gateway Logistics Park in Leicestershire, United Kingdom. The facility will be occupied predominantly by Nestlé for its consumer-packaged goods and will function as a testbed environment for XPO technology prototypes prior to global release.

The custom-designed distribution centre, scheduled to complete in 2020, will feature advanced sorting systems and robotics, alongside automation co-developed with Swisslog Logistics Automation. The site’s digital ecosystem will integrate predictive data and intelligent machines to deliver one of the most advanced distribution management centres in the world.

Furthermore, furniture retailer IKEA announced that it was teaming up with SSI SCHAEFER to implement faster service and greater storage capacity for its new distribution center in Montreal, that will service both the United States and Canada. The new facility will allow the retailer to further compete in e-commerce and smaller retail formats.

Set to be completed by spring 2020, the distribution center will have an automatic shuttle warehouse design that utilises SSI SCHAEFER’s 3D-MATRIX Solution, a high-bay warehouse (HBW) with 245,000 pallet storage locations, ergonomic multi-order-picking workstations, and the warehouse control software WAMAS. Post the Montreal project, SSI SCHAEFER will implement two follow-up orders for IKEA in Sweden and Switzerland.

It is clear that technology has clearly taken over several operations within warehouses. So what impact does this have on the workers whose jobs are now done by machines and complex coding?

“Usually the biggest hitch is the reluctance to adopt new technology by the employees, particularly those who have been here a long time,” remarks Al Seidawi. “Often people don’t like change and they want to continue using the methods and old systems, and these people need to be encouraged and supported in learning to adapt to new technology.”

Al Seidawi mentions that they use coaching and mentors to help employees see the benefits of the new tech and how it can help them.

“We have approximately 73 staff at our warehouse and some of them have been with us for over a decade. We even have staff members who have been here for 17 to 18 years, and they have witnessed a lot of change. They often need support in adapting to the changes, but we always prefer to train in house and retain our staff.”

ALS Logistic Solutions are specialists in the material handling and storage systems’ automation sector, providing products and services for airport consulting and IT solutions, air cargo handling systems, automated storage and retrieval systems (high-bay warehousing), warehouse management systems, and automated car parks.

Says Walid Khoury, managing director, ALS Logistic Solutions: “Technology has been positively affecting the logistics field since a while, especially in Europe, but it does not mean at the cost of unemployment. By using automation, the warehouse might have a lot more space to offer other services that require different manpower, such as e-commerce, value added services, special picking from workstations etc. The trends are surely pointing to adopt the changes and elaborate the most efficient man-machine interface and strategy.  From voice recognition to driverless trucks, the artificial intelligence definitely sharpens the market.”

Khoury believes that innovations and sophisticated technologies are an inevitable and necessary change on logistics market, but at the same time, a challenge.

“ALS has a training program designed for all sorts of automation technology that we design and install at our customers facility. We enable their staff to handle the sophisticated technology, which becomes easy to handle once introduced to the personnel in a friendly and knowledgeable way.”

ALS’ projects for the year include expansion of the OSR shuttle system for Dubai Duty Free Warehouse; automated pharma warehouse in Saudi Arabia; fully automated airport cargo terminals in Muscat and Salalah; supply and installation of airport cargo terminal in Dammam; installation of automated storage and retrieval system (ASRS) for WFS/BFS in Bangkok, ULD handling system for WFS Frankfurt, upgrading the facility for FedEx Dubai etc.

“Technology has been positively affecting the logistics field since a while, especially in Europe, but it does not mean at the cost of unemployment.”

Khoury remarks: “You remember Bill Gates’ quote, “the first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.” We absolutely agree with this statement. We always say that earlier involvement of a logistics consultant at the design stage minimises the risk of decision mistakes, whereas the after-sales support and training guarantee the most efficient systems operations and longevity of the installed solution.”