The warehouse of the futureThe warehouse of the future
podcast
In Dialogue with Logistics

The warehouse of the future

Authors:

Martin Hemmer, Innovation Manager at Rhenus Warehousing Solutions, talks about future warehouse solutions.

Drones, which complete warehouse stocktaking in flight, autonomous robots, which provide support with picking, or high-tech suits, which give employees in warehouses superhuman capabilities – all this sounds like science fiction, but these methods are already in use or are being put to the test in our Warehousing Solutions division. As an innovation manager, it is Martin Hemmer’s job to continually introduce new developments at the Rhenus Group’s warehouses, keep an eye on innovations in this field and examine whether they can be used within the company. He talks about his exciting day-to-day work in the Rhenus podcast entitled ‘Logistics People Talk’ and provides some idea of what the warehouse of the future might look like.

Podcast
21.07.2021

Logistics People Talk | Episode 3

Martin Hemmer, innovation manager at Rhenus Warehousing Solutions, takes a daring look into the future of warehouse logistics. How will technical innovations support work in warehouses in the future and what is already possible now?

Note: This podcast is currently only available in German.

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Transcript of our podcast episode

00:00:00
Andrea Goretzki: Logistics People Talk. The Rhenus podcast for everybody who wants to keep up-to-date in logistics matters. Presented by Gwendolyn Dünner and Andrea Goretzki. Our guest today is Martin Hemmer, the Innovation Manager at Rhenus Warehousing Solutions. Our topic is: innovations in warehouse logistics.

00:00:32
Gwen Dünner: Hello and a warm welcome! We’d like to welcome our guest today, Martin Hemmer.

00:00:37
Martin Hemmer: Hello! I’m delighted to be here.

00:00:38
Gwen Dünner: Mr Hemmer, it’s great to have you here. We’re looking forward to learning many exciting new things from the world of warehousing. But first of all, we warned you in advance – we’d like to have a short warm-up session with you. We’ve prepared some questions that you can spontaneously answer. Are you ready?

00:00:55
Martin Hemmer: Yes.

00:00:57
Gwen Dünner: Excellent. Home office or company premises?

00:01:00
Martin Hemmer: Ideally a mixture of both. A lot of home office at the moment, but I like being in Holzwickede too – just like today.

00:01:07
Gwen Dünner: City life or the countryside?

00:01:10
Martin Hemmer: The countryside.

00:01:12
Gwen Dünner: Delivery service or cooking yourself?

00:01:15
Martin Hemmer: Usually a delivery service.

00:01:17
Gwen Dünner: Then a Big Mac or sushi?

00:01:19
Martin Hemmer: We don’t have anything like that in the countryside.

00:01:23
Gwen Dünner: What do you have then?

00:01:24
Martin Hemmer: We have pizza or schnitzel.

00:01:26
Gwen Dünner: Oh, OK. A good choice. A boat or a motorbike trip?

00:01:31
Martin Hemmer: That’s easy: motorbike.

00:01:33
Gwen Dünner: Scrooge McDuck or Gyro Gearloose?

00:01:36
Martin Hemmer: Oh, what do I say here? No idea. Scrooge McDuck.

00:01:40
Gwen Dünner: OK. A driverless car or a talking refrigerator?

00:01:46
Martin Hemmer: A driverless car.

00:01:47
Gwen Dünner: And that brings us straight to our subject today, because driverless vehicles are already being used in warehouse logistics nowadays. You’re pretty familiar with everything from autonomous vehicles to the Internet of Things, because you’re the innovation manager at Rhenus Warehousing Solutions. How do you become one of them? And what exactly does an innovation manager do?

00:02:12
Martin Hemmer: I’ve been concentrating on the field of innovations since the beginning of this year. My business card describes me as an Innovation Manager. This topic was in my remit previously, however. I was responsible for the field of material flow planning in the technical purchasing department. But the topic of innovations is becoming increasingly large so that I can now fully concentrate on it with a small team, but not without involving the colleagues in my former department and asking them to help us too. Because innovations reach us from a wide variety of sources. One classic example is technology, as people often think in a warehouse, but also from the IT department in particular and sometimes even from the human resources department, when we’re dealing with issues like gamification or something like that.

00:03:08
Andrea Goretzki: You just said, Mr Hemmer, that innovations come from a wide variety of sources and departments. How have things developed if we look at the innovations in the warehouse sector during the last few years? What has been the development path and what is the status quo at this time?

00:03:22
Martin Hemmer: Well, as for developments, there have always been new topics in warehouses and we’ve always been up-to-date or have tried to be. We’ve attended trade fairs to learn more about what’s possible in the market. But we’ve noticed that innovative topics have increased enormously during the last two or three years, particularly regarding what’s available for a warehouse, and you now have to obtain a great deal of information and talk to many people in order to keep up-to-date – and that’s becoming more and more complex. The system of warehouse buildings, shelves, forklifts has been operating for a long time, but that’s no longer enough to meet customers’ requirements. And they too are constantly asking questions about innovations and/or new technologies. The emergence of innovations in the past then picked up speed and we first tried to pool all this across Europe, but then noticed that if you actually try to coordinate every Warehousing Solutions business site in Europe, people start asking questions like “What are you actually doing?”, “Who’s doing this first?” And, in the end, you’re just coordinating things and watching to see where new innovations are coming from; and so we said that we needed to focus our operations. That is to say, in every country we (and I mean a team) are focussing on the innovations that emerge there and can be introduced in the warehouses in that country. We’re pursuing this course in every country in Europe, but other departments within Rhenus are doing that too. Automotive or even Home Delivery each have their own innovation teams and we regularly coordinate matters with them and try to roughly keep up-to-date. Of course, there’s a risk that we’re pushing ahead with innovations in parallel at this or that point, but that’s not such a great disaster.

00:05:21
Gwen Dünner: If we look at things from the customers’ point of view – that is to say, the customers in the sense of the people sitting at home and ordering a package and buying goods, these innovations in warehouse logistics are usually invisible to them, because they involve internal operations and optimise the process, so to speak, until the parcel arrives at their front door. Despite this, there are some really very exciting projects. What are the highlights in your view?

00:05:47
Martin Hemmer: Well, I need to contradict what you’ve just said a little. We do certainly have different customers. We have our direct customers. They are industrial companies or even retail firms. They do notice the effects of the innovations that are used at our warehouses. But I agree with what you said about end customers. They receive their parcel at their front door, hopefully it has been well packed and they don’t see the technology that has been used as it makes its way through the warehouse. For example, via complex conveyors or going past the packages camera. It checks whether everything is in the parcel, or the automatic sealing unit, the automatic labelling machine and, for example, a subsequent sorting facility, which then feeds the parcels to the loading points in line with their destination. They’re completely unaware of all that. Or if, for example, the parcels are loaded on board a container using an exoskeleton – we’re currently using this in a test phase. We’ll have to see how far we get and what help it provides. Otherwise, a large number of innovations are naturally operating in our warehouses. We work closely with our direct customers.  A customer often asks us about innovative ideas, particularly during the business discussion phase. We’re often asked to offer innovative technologies and innovative solutions – but not so that we can directly implement them in our operations. Customers are interested to know whether we’re a company geared towards introducing innovations and whether we can and want to possibly implement new ideas with them in future, which don’t yet exist. As far as existing projects are concerned, some of which have a term lasting ten years, we’re naturally constantly on the look-out for innovative concepts. Our starting point involves relatively conventional procedures and we try to introduce innovations during ongoing operations. That’s often harder than when you start from scratch. It’s always best if we don’t have to make any enormous changes to structures, but if innovations can be gradually introduced in a modular fashion, for instance, if you can gradually replace manual terminals by pick-by-voice and pick-by-vision units.

00:08:00
​​​Andrea Goretzki: You’ve just mentioned a few keywords, for instance, packages camera or automatic labelling. It sounds as if more and more technology and more and more automation are being introduced into warehouse procedures and employees perhaps no longer have to get involved in many situations, as was the case in the old days. We’ve already arrived at quite a sensitive area pretty quickly. Does this mean that some tasks or jobs are being eliminated or what’s going on?

00:08:30
Martin Hemmer: A good question. Yes, well, some tasks are eliminated when we introduce more technology. We talk about mechanisation, but less about automation. Mechanisation is designed to help people. Mechanisation has been a familiar element in warehouses for a long time. Each forklift, for example, involves mechanisation and the pallets no long have to be moved by hand, but by means of a forklift. Everybody readily accepts that, it’s quite normal and we‘re continuing our work at this point. We’re looking for other things that we can mechanise in order to release people from mindless activities. We now call this a collaborative approach – that is to say, that people and machines work together. And I think that fits very well with technology. Technology is very much at home if the requirements remain constant – that is to say, the activities are always the same. That’s ideal for technology. If it’s always the same, you can use technology very efficiently. And I can say that they’re precisely the activities that people don’t enjoy doing. People prefer something with a bit of variety. And that’s when we need them and people should continue to be used there too. The question of where the boundary exists is a sensible one. What can the machine do and what else can people do? This boundary will certainly shift a bit. It may be possible for a machine to take over parts of what people definitely have to do at the moment. We’ll certainly continue to need people, because I can’t see full automation in a warehouse for a very long time.

00:10:06
Andrea Goretzki: That means ultimately that all the mechanisation is designed to help people and ease the pressure on them and not replace them?

00:10:16
Martin Hemmer: Yes, that’s exactly one way of expressing it.

00:10:19
Gwen Dünner: That’s a relief. And what kinds of automation solutions already exist, which Rhenus is testing or has already introduced. Is there anything new in this field too?

00:10:29
Martin Hemmer: I need to say that we’ve naturally been mechanising operations for quite a while. We’ve installed very extensive conveying and sorting technology, particularly for fairly large projects. As I’ve already said, we have cameras and integrated trolleys, which automatically look to see whether the parcel is complete and possibly reject it from the system. And we naturally have new concepts too. I must also mention that our customers, on whom we focus our work to a very great degree, are very different. They have different requirements and very different types of goods and also stipulations for the way that we handle their goods. That’s why we cannot use the same technology in each project and have to or want to and are able to consider very different approaches in each project and then have to make use of them as efficiently as possible – and I believe that’s an excellent approach. That’s why we have many examples of different technologies and new technologies that we’re using – for example, goods to employee. They were formerly called paternoster lifts. We have, for example, a very new shuttle system at our business site in Eisenach. It’s equipped with rapid picking facilities, so that it’s possible to achieve very high efficiency levels. We have an automatic reach stacker in Dortmund. We have automatic low-floor vehicles, which can handle the shipment of pallets, or robot arms. We’ve also been testing a stock-taking drone and there are some other innovations too.  

00:11:58
Andrea Goretzki: During the either/or question session, when asked to choose between talking refrigerators and driverless vehicles, you opted for the latter. Let’s talk about them. What are the advantages and disadvantages here? How do we prevent, for example, driverless forklifts from hitting colleagues in a warehouse? Or do we have, for instance – and I think we’ve already broached the subject – any effibots in service? Why don’t they crash into workers? What exactly is happening here?

00:12:33
Martin Hemmer: Highly sensitive technology has been incorporated into even the smallest machines that operate alongside people or that are operating in collaboration and this technology constantly observes the area around the machine. As soon as something enters this area, which doesn‘t belong there, the vehicle slows down or comes to a standstill. That is to say, it sees precisely who is in its operating range. It adjusts its speed. And once this obstacle is no longer there, the vehicle continues moving independently. However, it doesn’t move backwards. This will only happen when we get to the point where the machine can communicate with a person, that is to say, it recognises that it cannot get past and needs to look for a different route. Initial tests have already been conducted here. We don’t yet have any of them in our warehouses. We’ve performed the first tests with moving robot units that avoid people. But that’s an area where research is still taking place. We’ll have to see whether it’s all useful – if the robot constantly avoids people and somehow looks for other routes. Ultimately, that’s not productive, of course. There’s always the area of tension between technology and business efficiency. Not everything that works and looks great can be used in a cost-effective manner in the end. And that’s ultimately the litmus test. 

00:13:56
Gwen Dünner: We’ve basically arrived in the field of artificial intelligence and digitalisation. How important is the digital world or digitalisation in these kinds of processes? And naturally machine learning too. Which methods are being used here and what are the results?

00:14:14
Martin Hemmer: Just as you’ve said: digitalisation is present everywhere. We’re basically no longer talking about it, but simply accepting it, because we won’t make progress any more without it. We’ve already had it in our warehouses for some time. We’ve no longer been working with lists for quite a while, but use manual terminals that report each accounting entry to the server and everything is processed there online. And, if necessary, this information is also directly passed to on the customer, which adjusts its stocks in response, possibly changes its orders and orders items that then arrive in the incoming goods section. That is to say, we’ve been operating digitally for some time. But digitalisation has increased significantly in other areas too. There are many different solutions available. In addition to hand terminals and so-called wearables, we now have pick-by-voice and pick-by-vision units. We’re working with smart watches, that is to say, display devices, backhand scanners and ring scanners. I’d include all this under the heading of digitalisation. The topic of digital twins is, for example, an enormous issue at this time. It basically existed to a minor degree in the past. People set up test systems and they were used to simulate what would most probably happen in a real warehouse. Fairly large simulation procedures were commissioned and conducted with the data that was available. And precisely that has now become much simpler, logging data on a massive scale and constructing something from this data. It’s now developed so far that it’s possible to actually talk about a digital twin. We record data in the warehouse using a particular tool. We therefore equip employees with sensors and distribute sensors around the warehouse and can then establish how the employees walk through the warehouse, how they move, how quickly they move, the places where they stop, when they bend down, when they reach up for something or reach down too. Everything is anonymised, as far as data protection is concerned. Don’t worry.

00:16:34
Andrea Goretzki: That would have been the next question.

00:16:39
Martin Hemmer: It’s impossible to discover the identity of the people. We want to use this to optimise and view the processes. Things like, “Why do employees always stop walking in a particular area? Are there any obstacles that hinder them? Have items not been properly positioned? Are they too high, too low, too heavy or whatever…?” We can then intervene there. And it’s now possible to assess things like this with a digital twin or by processing huge amounts of data and taking advantage of it. That was very much harder to do in the past. Much more effort was required in the old days to get hold of this amount of data and be able to assess it so easily.

00:17:24
Andrea Goretzki: Let’s stay with digitalisation for a moment. The ongoing Covid-19 pandemic has really provided a boost for digitalisation both in people’s private lives and in the business world – it’s really been all-embracing. Have you noticed the same at our warehouses? And what’s changed there? Is Covid-19 basically accelerating the development of new solutions? Which solutions have turned out to be particularly worthwhile when you look back over the past year?

00:17:56
'Martin Hemmer: Yes, it has first of all meant for me personally that processing work has naturally become very different. We don’t actually spend so much time in the warehouses now – in fact, hardly any time at all. We’re working digitally using video conferences and our Teams platform has proved a real asset and we’ve learnt a great deal. We’ve also had to learn how to handle this and it’s clear that it really works very well. We’ve naturally not been able to change things in our warehouses so quickly, because the items are still being kept there and they need to be picked and packed and sent to customers during Covid-19 too. However, it’s become clear that it makes sense to work through these kinds of topics, as I said earlier. Processes like “goods to person” are naturally more suitable to prevent any contact rather than walking through the warehouse with several pickers, who are constantly very close to each other. But this kind of thing cannot be changed that quickly. These kinds of fixed structures still continue. But it will certainly play a role in future – and would have done even without Covid-19. Perhaps not with the same force – perhaps it’s providing a boost for this.

00:19:16
Gwen Dünner: Warehouses themselves can also be an innovation. We at Rhenus have this outstanding example in Tilburg, for instance. There are solar panels on the roof. It’s particularly energy-efficient and the building has attracted an award as the most sustainable industrial building in the world.

00:19:31
Martin Hemmer: Yes, the warehouse in Tilburg is definitely worth seeing. Really. But the outstanding features mainly relate to its structure. Other colleagues there are working on innovative topics related to the building, among other things. I myself am focusing more on innovative issues within warehouses. But our colleagues there have also incorporated some interesting features – a huge amount of technology, for instance, the Autostore facility, which moves warehouse boxes in a very tight space using robots and takes them to the picking point. This illustrates that at Rhenus we have many places that are focusing on the issue of innovations – but not just technology, but in the building structure too or where energy and sustainability are involved. The issue of innovations is so enormous that it can tolerate a huge number of people delving into it. And we’ve seen during the recent period that it’s important that this doesn’t just happen at one point, but innovations are being worked on by very many people or are being introduced into the company or into teams by very many too.  

00:20:43
Gwen Dünner: But that doesn’t mean that we’re now planning to build all the warehouses like the one in Tilburg, does it?

00:20:49
Martin Hemmer: I’ve not heard that.

00:20:49
Gwen Dünner: It would probably be expensive…

00:20:53
Martin Hemmer: Yes, but if it’s worthwhile in the end. That’s the issue – being prepared to try things out. It might not perhaps always be worthwhile, but if we do this all the time and duplicate the process, it must produce something positive at the end. I don’t think that all the next few warehouses will look just like it. But we’ll certainly be able to draw some lessons from it about what you can use at other warehouses and also how it fits into with the customers that we’ll have in future, that is to say, in our warehouses. It has to fit their needs too.

00:21:24
Andrea Goretzki: You just made a brief deviation and mentioned the topic of sustainability. We’d love to talk about that in greater detail. What role does the topic of sustainability play in innovations? Do innovations also have to be fundamentally sustainable in order for Rhenus to use them? Or are we first testing them anyway on a general basis?

00:21:47
Martin Hemmer: I believe that the issue of sustainability is now automatically an integral part of these topics. That is to say, we’re not really looking at anything that’s not at least to some extent sustainable. Issues that damage the environment or consume huge amounts of resources are really no longer being tackled and are no longer covered by the heading of innovations either. That means that sustainability is automatically part of any considerations. We’ve always had relatively sustainable operations in our warehouses. We’ve been using electric forklifts for decades and had no combustion engines in the warehouses. The trend that we can now observe on the roads – having electric cars – is something that we’ve had in our warehouses for quite a long time. The issue now is where does the electricity come from and how is it being used? We’re working, for example, with so-called energy filling stations and are successfully ensuring that the batteries can be used for longer periods than in the past, because they’re being charged carefully. We’re making it relatively easy for the employee to always take the best-charged battery and we’re therefore reducing the so-called peak loads. That is to say, we’re considering the energy generation, for example, as in a power station. Particularly large amounts of electricity then don’t need to be made available at peak periods. And that should be a good example to illustrate that sustainability, innovations and economic efficiency can go hand in hand. 

00:23:27
Andrea Goretzki: Are there perhaps also some innovations that Rhenus hasn’t yet tried out? Do you have a personal wish-list of innovations that you’d love to test?

00:23:40
Martin Hemmer: There are a large number that we’ve not tested yet. As I said, the market for innovations is growing rapidly and it will probably not be possible to try out everything that’s available. We need to focus on the things that will most probably enable us to make progress. At some point, we have to say, “Well, we’re now pursuing an innovation, an idea or a technology with greater intensity and we’ll also introduce it into the warehouse so that we can actually see how it works there, what effect it has and what kind of success we can achieve with it.” Just talking about innovations all the time and drawing up lists and indicating what you’ve heard about somewhere and saying to yourself that it might actually work at our facilities won’t move us forward in the long term. At some stage, we have to introduce it into a warehouse and in such a way that it can be viewed as a profitable venture.

00:24:35
Gwen Dünner: We’ve now talked about some methods and innovations, which sound rather futuristic for us, but, as you’ve already said, have almost become part of our everyday furniture. What is futuristic for you at Rhenus? Where is Rhenus heading to?

00:24:50
Martin Hemmer: I think the fields of ergonomics and employee availability will occupy us during the near future. That is to say, we’ll have to provide better workplaces, even better than those that we already have. The average age of employees is increasing, so we’ll have to do something in terms of ergonomics. The same is true of employee availability. We’re already noticing this. Good forklift drivers, for example, are already hard to get hold of in many regions. We have relatively high buildings. All our buildings are about twelve metres high. And not everybody can put pallets into storage at that height. So we can see that we need to do something at this point too. Definitely. Otherwise, we’ll no longer be able to operate our warehouses. As far as where the world of warehousing is actually heading – that’s a question that I’m asking myself at the moment and whether we can actually continue using this system of central warehouses that we now have. It’s doubtful, given the need for rapid deliveries, which people now expect. Things may possibly move towards having local warehouses, where we then have to ensure that the material that we need is always available at each site. We’ll most probably have to deal with the topic of data again there. In the past, we looked to see what had been used up and then we refilled our stocks – but that will probably no longer work in the long term, but we’ll need to look and see what is used in a field or region and assess what will probably be used there in future?  We’ll have to ask whether we can’t already pack parcels or pack pallets and then just wait until the customer – the end customer – sends an order and we’re basically prepared for everything that will come. We’ll probably be able to manage that on the basis of extensive data in future.

00:26:46
Andrea Goretzki: You’ve now expressed a few ideas about all-embracing organisation. If we take a look at an individual warehouse once again and you look into your crystal ball, what do you think a warehouse will look like in ten years’ time? Where will the journey take us?

00:27:03
Martin Hemmer: A warehouse, which has been built and equipped now, will most probably look just the same or similar in ten years from now, because the facilities, which we install there, are often written off over a period of ten or 15 years and therefore need to be kept operating so that they’re profitable. If new warehouses are built ten years from now, they‘ll certainly have more technology and consist of a mixture of permanently installed technology and possibly modular technology, modular robots. These kinds of modular units will be used to a greater degree in future and everything that this technology cannot yet do will be performed by people. In future, there’ll still be enough areas that machines won’t be able to handle for quite some time.

00:27:56
Andrea Goretzki: Thank you very much for these exciting insights. It sounds as if our colleagues in the Rhenus warehouses will receive a huge amount of technical support during the next few years. We’ll be closely following the way that things develop.

00:28:10
Martin Hemmer: I’ll be doing the same.

00:28:16
Andrea Goretzki: And it’s now time to say good-bye to you, our listeners. We hope that you’ve enjoyed what you’ve heard and have learnt many new things. Thank you very much for listening. Stay with us and definitely take a look at the Rhenus social media channels. You’ll then discover when our next podcast will go online. And you can naturally subscribe to Logistics People Talk – anywhere where you can obtain your podcasts. Thank you very much. See you soon. Take good care of yourself. Best wishes from Gwendolyn Dünner and Andrea Goretzki.

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