Grow Your Business In 2019, Another Year of Automation

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Dan Arens is an Indiana-based business growth advisor. Dan Arens is an Indiana-based business growth advisor.

Employees at the online retailer gasped when robots were introduced a little more than one year ago. They feared robots would replace all of them. Fortunately, their fears were totally unfounded. In fact, they discovered and developed a much more optimistic view of the future, not only for them, but for the entire company.

Employees of Boxed, the online retailer were asking “What is going to happen to us?”  according to a recent article by Associated Press reporter Christopher Rugaber. Boxed had announced plans of an automated warehouse. But the employees found out automation helped them in areas like lifting, retrieving, and transporting; tasks they had to do themselves before. They found out that instead of living in fear of losing their jobs, the company had to add a third shift in order to expand their capacity, because of the ever increasing volume of orders.

In fact, one of the vice-presidents commented “We’re not looking to do the same work with half the people, since we’re growing, we need everyone.”

While many employees have heard the mantra ‘It is all a matter of perspective’, in the case of automation it can be true. Even with store front retailers consolidating and going out of business everyday, the advent of e-commerce has resulted in creating more jobs, according to Rugaber.

He observes that we are “paying people to do things we used to do ourselves....when people shop online, tasks that consumers once did— driving to a store, searching through aisles for product, bringing it to a cashier and paying for it - are now done by warehouse employees and truck drivers.” Overall, research has shown that people are spending much less time shopping than they used to do.

While the sea change of automation is most certainly disruptive in retail, it is quite possible that the retail business model is transitioning to automation via online (automated) shopping and processing. It is far from helpful to the owners of retail businesses, but it is clearly a matter of perspective when viewed in the context of jobs being created. Training and re-training become very important. All of this is in spite of the apparent proliferation of “Amazon-proof” offerings like nail salons, coffee shops, laser hair removal shops and restaurants in the retail sector.

Yet, even restaurants are experiencing automation in the form of automated ordering kiosks. Places like McDonalds and Panera Bread are leading the way when it comes to automating the ordering process. Other places like Applebee’s and Olive Garden are providing ordering andpaying table top units to make order taking and paying more efficient. 2019 will see an increase in this type of automation.

In the area of manufacturing, the ‘perspective’ is not much different. Just last October, the 2018 Manufacturing Survey for Indiana was released. It brought further support to the ever increasing role of automation in that major economic sector of the state. Industry 4.0, also known as smart manufacturing or digital manufacturing, was once again, in the spotlight.

As a quick frame of reference, according to McKinsey and Company, there have been three prior ‘upheavals’ (Industry 1.0, 2.0, and 3.0) in modern manufacturing; the lean manufacturing revolution of the 70s, the outsourcing phenomena of the 90s, and automation beginning to kick in for the manufacturing sector in the 2000s.

In providing a better explanation of the 4.0 wave, The 2018 Manufacturing Survey states that “Industry 4.0 is simply the best of traditional manufacturing carefully blended  with the most advanced and capable new technologies.”

When it comes to workforce and automation, one survey participant was asked what the worst manufacturing decision they had made this past year, they replied “Buying new machines without properly trained employees.” That observation alone, should serve to encourage business owners, who are automating, to reach out and embrace their current workforce when it comes to training and retaining their employees. Having a growth plan for automating your business should include training your employees for new (different) positions.

The Indiana Department of Workforce Development recently reported the unemployment rate in Indiana through October was 3.5% while the national average was 3.7%. While our unemployment rate has been consistently lower than the national average, we are quickly transitioning to more automation in many sectors while retaining a low rate of unemployment, a great indication of managed growth. It appears as though 2019 will be another year of growth that embraces more automation.

Dan Arens is an Indiana-based business growth advisor.

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