May 30, 2019
Humans are, and will always be, a crucial part of the value stream. Robots can handle repetitive functions, quality precision, and around-the-clock work, but they cannot handle strategic decision-making.
Humans, on the other hand, use reasoning to work around the unforeseen and analyze situations to improve processes. But people cannot work 24-hour shifts. Instead, it is imperative to optimize the tasks of both humans and robots to create the flexible workflows needed to meet the ever-changing demands of an ever-changing world.
Neither humans nor robots can do it alone; they must work as a team. Even with automation, the extreme labor shortage within the material handling industry is making it impossible for companies to meet staffing requirements.
Large organizations are turning to robots to remain competitive and sometimes simply stay in business. History has proven innovation leads to job creation, not loss. Integrating automation creates better, safer, more fulfilling roles that people want and need.
By combining innate human strengths with those of automation, a real sustained economic value is established.
The U.S. jobless rate is at a 49-year low of 3.7 percent. Yet, the exponential growth of e-commerce demands has created an additional 452,000 material handling positions in 2019 that employers are struggling to fill. To make up for the shortage of full-time workers, companies often turn to temporary or seasonal staff.
This leads to increased recruiting, hiring, training and turnover costs. To entice workers back into the warehouse, organizations have doubled the hourly rate in the last five years. The annual wage increase for material handling workers is between 5.8 and 6.2 percent, far above the 2.7 percent national average.
After looking at these statistics, many operations managers are tempted to turn the lights out and run only with robots. But those who have tried – Tesla, for example – realized this does not work. Tesla’s human-free “last-mile manufacturing” was intended to save the company money but led to Tesla missing every single one of their production goals and resulted in 100,000 recalls. Tesla CEO Elon Musk’s intricate system of automation could not properly adapt to changes to stay on schedule or identify and correct faulty parts to deter costly mistakes.
Musk said, “Yes, excessive automation at Tesla was a mistake. To be precise, my mistake. Humans are underrated.”
If companies want to deliver on customer expectations to grow revenue, not just save money, humans cannot be taken out of the value stream.