November 10, 2014
Volume I, Issue 7
Asking the Right Questions

There are MANY applications in distribution that can be automated today. Generally speaking the most cost effective applications must have the economy of scale and usually involve towing carts long distances.


For many years AGV (automated guided vehicle) providers have known that there is a goldmine of applications for DCs (distribution centers) but the costs have always been prohibitive. From placing product from end of aisle locations into racking up to 35 feet to automated travel with human picking, these applications are common and a good fit for automation solutions; as the costs of systems comes down, there will be a large shift in focus from manufacturing to distribution from the solutions providers.

Application Study and Analysis

There is an increasing focus on ergonomic considerations for automation, yet until recently ergonomics has not been a word associated with AGVs.  AGVs have been considered stand-alone pieces of equipment that moved pallets, large bins, and totes.  This perception and usage is changing, as there are now a few select companies that are taking AGV technology and applying it to applications that directly interface with humans. From moving parts to people for picking or manufacturing to mobile build assemblies, AGVs are now more than ever working with people instead of replacing them.

Specification Development 

From a different perspective though, vendors of AGV controls and guidance technology are working with forklift manufacturers to automate existing vehicles. This not only has the potential to drive down the cost of AGVs, it also provides a way to have ergonomically, operator-friendly AGVs that can be used in an automated fashion.  These AGVs can switch back to manual and be used by humans when a situation requires thought and special understanding that only a human can provide. 

Vendor Selection

The most common landmine for companies considering automation solutions is actually understanding if automation is the right choice.  When an automation vendor is called to look at a specific problem it becomes a nail, because the vendor has a hammer.  Too often companies incorrectly invest time and money going down a rabbit hole only to discover they cannot afford an AGV solution.  Sometimes the problem may be easily resolved as a simple operational issue.  A great application to a vendor means a sale; it may or may not be a great application.


Without precise specifications about the automation required and the outcomes expected, automation vendors sell what they have and the results will be disappointing.  Many people say that the devil is in the details; in this case there are major costs in the details.  Ignorance costs money at the time of installation; it costs time and efficiency modifying processes to meet what has been provided. Worst of all DCs and manufacturers may not look far enough in long-range planning, only to discover a system is purchased that is not capable of handling the additional operations required in the near, mid, or long term.

Project Manage

After a new AGV system is purchased, the next step is not always clear.  The AGV sales rep was great, trustworthy, and likable.  Now DC managers or manufacturing plant managers meet the project implementation team. This is often the start of automation trouble. This implementation group does not know what the customer has said or what the sales rep has promised before this initial meeting. In fact their interest is NOT the customer's interest.  Their job is to limit the risk of the project on the vendor's side and extract as much additional margin as possible on the implementation project. This team is rewarded for increasing project margins and will be very strict in the application of the contract and the specification.  This is where the customer advocate is needed. This is where a customer project manager (often an experienced third party with extensive experience in these types of implementations) is needed.  The project manager is the watchdog on the implementation on behalf of the customer. 

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