Automation: What impact will this have for supply chain?

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What is Automation?

ISA define automation as “the creation and application of technology to monitor and control the production and delivery of products and services.”

Automation “now not only includes robots on the warehouse floor, but also artificial intelligence and data processing technologies that can gather and process information more efficiently than humans can.” – SupplyChainDive

Advantages of automation:

1. Reduce costs
One of the biggest benefits of automation is the reduction in costs. Companies who have already implemented automated systems have seen positive bottom line results from the early adoption. As more businesses start to embed automation as part of their overall structure, the money saved can be better spent to improve the overall service to their customers.

2. Improve productivity
Although humans provide high quality work, automation offers increased productivity with a noticeable improvement on efficiency, quality and safety.

3. Increase compliance
Automation can be hugely beneficial within the supply chain industry. Compliance can be maintained accurately by standardising pricing, products and vendors.

4. Reducing environmental footprint
If your business is working towards becoming a paperless environment then automating your software can really help to reduce a manufacturer’s carbon footprint.

Disadvantages of automation:

1. Lack of jobs
As automation becomes a key part of business, the need for employees is going to be less which could lead to high unemployment rates.

2. Large initial investments
As highlighted above, automation reduces costs continuously overtime. However, there is an initial investment to set up and run the automated machines which could be out of budget for a lot of businesses within the industry.

Automation is providing great benefits to businesses within the supply chain industry. As companies continue to grow there is a clear need to automate certain elements of the business to ensure a high quality service / product can be delivered to customers at all times.

However, the disadvantages could have a detrimental effect on the overall supply chain industry as employees are replaced with advanced machine, leaving uncertainty for workers.

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