Tim Wei featured in Retail Tech Bulletin: Supply Chain and Autonomy
Updated: Jan 26
Tim Wei is featured in Northwestern’s Retail Analytic Council. Wei explains the early impacts of the Coronavirus on supply chain and frames how autonomy is our best solution. We've included some summary points in this article and have linked the full publication below.
The correlation between labor force and supply chain was no more evident than in the meat processing industry in the early days of the coronavirus pandemic (See Figure 1 in the publication).
Panic buying exacerbated shortages.
Shortages in labor, materials, and parts are therefore combining to reduce production of goods and impede recovery of inventory-to-sales ratios (See Figure 4 in the publication).
One increasingly viable technology opportunity is autonomy.
Autonomy is #sustainable
*Key take-aways are quoted from Wei's publication.
"Autonomous systems represent a solution to the labor vacuum that has been emerging (and exacerbated by the pandemic) since the beginning of the twenty-first century." -Tim Wei
Resources for further learning:
Author: Dr. Timothy Wei
Source: Northwestern Retail Analytics Council Q4 2022 Retail Tech Bulletin
The correlation between labor force and supply chain was no more evident than in the meat processing industry in the early days of the coronavirus pandemic. Within weeks of the pandemic spreading across the US, the meat processing industry was in crisis. By May 2020, the rate of infection in US counties with 20% or more employment in meatpacking was as much as ten times higher than other non-metro counties (Figure 1). At the same time, between workers falling ill, plant shutdowns, and workforce reductions, there was a precipitous drop in meat production (Figure 2). A year that had started with such promise for the meat industry devolved into chaos.
The pandemic, of course, unleashed a perfect storm. International trade routes were paralyzed by port closures. Panic buying exacerbated shortages. Factories and retail outlets alike were locked down. Employees in retail (and across society) either chose or had to find alternative sources of income. In short order, the entire retail supply chain fell into disarray.
As the US emerges from the pandemic, there have been dramatic shifts in the distribution of the nation’s workforce. While statistics are returning to pre-pandemic levels, many have chosen not to return to traditional jobs; this raises questions about the meaning of percentages across a disruptive event. The trend toward alternative sources of income, e.g., the gig economy, was emerging even before the pandemic. Whatever the cause, retail and service industries have had to adjust to doing business with fewer workers (Figure 3). This poses tremendous challenges to industries where the in-person customer experience is of utmost importance.
Labor challenges, however, are not unique or limited to retail. Indeed, manufacturers are having similar difficulties in attracting and retaining workers. Shortages in labor, materials, and parts are therefore combining to reduce production of goods and impede recovery of inventory-to-sales ratios (Figure 4). The challenges faced by the retail industry today are therefore ultimately a culmination of challenges across the supply chain. And their resolution will require holistic solutions across that supply chain. This is not something that any one industry or company can solve on its own.
One increasingly viable technology opportunity is autonomy. As distinguished from automation, which is machines doing repetitive tasks, autonomy uses data and analytics to enable devices and systems to intelligently carry out complex functions in dynamically changing environments. Automation requires clear separation between machines and humans to ensure worker safety and operational efficiency. Autonomy allows safe collaboration between humans and machines, i.e. co-robotics, to leverage relative strengths and mitigate weaknesses.
Autonomous mobile robots (AMRs), for example, are mobile platforms that have been deployed in factories and warehouses. Equipped with an array of sensors and signals, AMRs are being used to transport material throughout facilities with full situational awareness of objects that are both stationary as well as moving, e.g., people. They are programmed with onboard intelligence to complete their missions without endangering people, themselves, or their cargo. Further, instead of carrying cargo, they can transport machinery, such as robotic arms, which allow them to make decisions and carry out nuanced tasks much in the way humans do. In the context of retail, the technology exists to deploy an autonomous system to manage a stockroom with a capital expense on the order of $10,000.
In larger, more complex environments, fleets of autonomous devices can be deployed to accomplish an array of activities. Most recently this is being and has been done in a number of food and beverage processing facilities both in the US and abroad. In these applications, a central command center provides assignments to individual AMRs for efficient operation across the facility. Each AMR, however, has its own onboard intelligence to optimize its own path to minimize distance, time, and energy usage while avoiding collisions and areas of congestion. At the completion of each assignment, the AMR receives a new and potentially completely different task.
A key point of using food manufacturing as the exemplar here is that the technology now exists to safely deploy autonomous systems and robotics to handle highly variable objects such as food, as opposed to highly standardized objects such as ball bearings. But more importantly, autonomous systems represent a solution to the labor vacuum that has been emerging (and exacerbated by the pandemic) since the beginning of the twenty-first century. This is no longer a question of replacing human labor with something ostensibly more effective and efficient. Rather it is a question of filling the void needed to accomplish manufacturing and retail tasks necessary to provide essential goods and services to society. Finally, while autonomy in manufacturing will be essential for sustainably meeting the needs of the retail industry, it represents a powerful tool to fill labor needs directly in the retail space.