R&C: How would you describe the extent to which digital transformation is reshaping the way supply chains operate? What new digital solutions are you seeing in this space?

Barrett: The demand and behaviour of today’s informed customer, coupled with the need to lower cost and shorten time to market, is driving businesses to rethink their supply chain model. Additive manufacturing, advanced analytics, Internet of Things (IoT), robotics and artificial intelligence (AI) are revolutionising the market. Companies able to capitalise on a decentralised and automated approach, personalised to customer orders and preferences – such as Adidas speedfactory and Amazon Prime Now – will outperform competition and exceed growth targets.

Tilley: Grocery retailer Ocado uses AI to optimise its logistics operations. Its warehouses are using purpose-built, battery-operated robots that can travel at speeds of up to 4 metres per second across a highly compact ‘hive’ layout, to pull together an average grocery order 20 times faster than a human. While ‘hive’ warehouse robot technology is undoubtedly eye-catching, in our view it is the underlying automated decision making that links the entire process from customer order to customer doorstep. The robots work together as a swarm, collaborating to efficiently access the required storage basket and bring it to the picking station. But the really clever move is the digital twin simulation model that uses real-time sales data to predict likely demand and return the robot, not to its previous location, but to a new location that is optimised to minimise the travel distance for the next pick. Not only does the warehouse look like a chessboard, it is also thinking several moves ahead. This future-facing, decision-making brain eliminates the concept of static stock locations and creates a smart platform that is much harder to copy than the physical layout.

Jan-Mar 2019 Issue