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Research Report

Embracing industry 4.0: The smart warehouse revolution

5-minute read

February 13, 2024

In brief

  • The rapid growth of e-commerce and 'lot size one' production demands have forced warehouses to evolve into efficient, 24/7 operational epicenters.

  • Companies increasingly turn to automation technologies to address labor shortages, rise in customer demand and need to optimize processing times.

  • To help companies to build the right solutions, Accenture identified 4 key elements to transforming warehouses into drivers of new value and growth.

Warehouse automation: An essential move for modern business

The need for efficient warehouse operations has only grown with the rise of e-commerce and the need for greater resiliency from disruption in the end-to-end value chain. Warehouses play an important role in the relationship between companies and their customers, and inefficient operations can negatively impact customer satisfaction.

Companies are turning to warehouse automation in response. The right level of automation and autonomy enables faster, safer and more efficient day-to-day operations. It cuts costs and improves delivery times for a faster, leaner, and more scalable and sustainable operation.

Yet companies across industries are struggling to select the right solutions to get their desired returns on investments. They’re mixing innovation solutions with ‘tried-and-true’ approaches that ultimately hinder success.

Companies visualize new, quick-fix solutions and end up executing siloed, digital projects that add incremental value but fail to achieve the scalability required to drive strategic returns.

Look familiar?

What were tried and true in the past, will fail fast in the future

Getting distracted by the better mousetrap syndrome

  • Big-picture opportunities around reimagining warehouses are missed.
  • Impulse investments lack a clear understanding of objectives and application.

Choosing one-size-fits-all solutions

  • Increased investment in new technologies, irrespective of the size, scale, and purpose of operations.

  • Lack of appropriate due diligence in assessing warehouse complexity and labor requirements.

Calculating ROI from a narrow perspective

  • Only traditional measures related to labor costs and productivity improvements are used. Hidden gains are missed.

  • Gains linked to overall supply chain objectives are missed.

Failing to integrate technologies

  • Investments in point solutions aim for quick wins.
  • No clear plan to integrate legacy infrastructure with new technologies.
  • Unable to identify the right platform to integrate various automation solutions.

Inadequate leverage of human and machine intelligence.

  • Missing: Platforms for seamless human-machine interaction 
  • Investing only in robotics, not in other technologies
  • Robots as a labor solution overlook collaborative and augmenting capabilities.

To maximize potential, companies must adopt a new strategy that puts warehouse automation at the center of operations.

A new path to warehouse automation

The key to successful warehouse automation is to be mindful of the expanding role of warehouses. Companies must transform their warehouses to deliver more impactful, longer-term value. With the right strategies, warehouses become more productive and efficient, drive customer-centric experiences and operate sustainably.

Our research can help make this ambition a reality. Accenture identified four key elements that are vital to transforming warehouses into drivers of new value and growth.

Broader vision

Re-evaluate the relevance and role warehouses are expected to play in overall supply chain strategies.

Right solution

Categorize warehouses based on the complexity of operations and labor intensity requirements to identify the right technology solutions.

Measure what matters

Identify and include the less obvious but vital returns when calculating ROI.

Build connectivity

Integrate and combine technologies to facilitate impactful automation and autonomy.

To generate desired returns from warehouse automation investments, companies must design the right digital architecture for their warehouses.
To generate desired returns from warehouse automation investments, companies must design the right digital architecture for their warehouses.

Painting a bigger picture

Companies cannot risk delaying a strategy shift to warehouse automation. The 24/7 digital economy we operate in, the impact of Covid-19 on supply chains, and the increasing consumer demand for instant, sustainable commerce are forcing companies to transform their operations.

However, old approaches to deploying new technology solutions will not deliver the expected levels of return: it’s time for a greater strategic shift. Companies must have the foresight to visualize the true, long-term potential of the right technology investments.

Warehouse automation and autonomy will result in more efficient, competitive operations, a thriving workforce, and a resilient business that is prepared for any opportunities or crises ahead. By leveraging the four key elements identified above, companies can succeed in their automation efforts and transform operations into well-oiled thinking machines.

WRITTEN BY

Joe Lui

Managing Director – Global Robotics Practice Lead, Industry X

Rushda Afzal

Research Manager – Industry X

Antoine Martin

Managing Director – Autonomous Robotic Systems, North America, Industry X

Umesh Inamdar

Associate Director – Digital Transformation and Detroit Innovation Center Lead, Industry X