Using Robots To Get Saks Web Orders Out A Day Faster
Written by Evan SchumanWhen Saks CIO Michael Rodgers was tasked with trying to accelerate the $3 billion apparel chain’s Web order deliveries, he knew he needed help, and he opted for a non-traditional form. Rodgers made arrangements to command an army of 700 robots—each one capable of transporting a half-ton of merchandise at a time.
No, this isn’t some IT apparel version of Revenge of the Sith (although that would be cool, in a sort of geeky wool-blend kind of way). It’s merely the unexpected path taken by the 53-store chain’s IT leader, who wanted to see how much of a Butterfly Effect he could cause in E-Commerce customer satisfaction by making small improvements in fulfillment operations.
The computers in question are not of the Cyborg type, and they look less like C3PO and more like a cross between R2D2 and what Rodgers calls a “giant Roomba“—you know, those robotic self-running vacuum cleaners. They’re orange and made by a robotics startup called Kiva Systems, which has placed these squat robots in the warehouses of retailers including Gap, Crate & Barrel, Walgreens and Staples.
Officially, the robots are just another form of warehouse automation. The twist is that rather than retrieving an individual product, the robot picks up and brings a full mobile shelving unit to the human packer. That’s why its ability to lift a half-ton is vital. This option allows human workers to stay in one place. But it also allows for much greater efficiency, because the robots can remember precisely where products are supposed to be. Translation: Instead of declaring that one particular shelf will have only white shirts—even if enough white shirts have been moved that there’s a lot of empty space on that shelf—it’s possible to mix and match products in whatever is the best form to cram in as much as possible.
“I can co-mingle merchandise. These fixtures can be packed very close together,” Rodgers said. No human-friendly organization is necessary.
“The robots, they bring the fixture and they then put it away,” he said. “It’s a huge productivity increase compared with people running around” the chain’s 70,000 square-foot warehouse in Aberdeen, MD.
This approach also decreases theft, because humans are banned from the area where the robots are working and the entire robot-a-thon is watched via closed-circuit cameras. If someone did try and sneak in to steal, they would be detected almost immediately. (The alarm probably does not shriek, “Danger, Will Robinson! Danger,” although that wouldn’t be the worst idea I’ve heard recently.)
Here’s where we get to the faster shipping part. “We’re projecting about a 50 percent improvement in productivity,” Rodgers said, which will allow product “to get out the door much more quickly. And we then expect to make a lot more FedEx cutoffs,” he said.
In other words, if that productivity boost allows Saks to deliver most products in one day rather than two, that could be a huge customer-perceived benefit. “We’re investing a lot of money in this. We’ve made a big bet,” Rodgers said, declining to specify an investment amount.
He also expects sharp reductions in headcount, especially a reduction in temporary staff needed during the holidays and other busy periods. But Rodgers said he’s less focused on headcount reductions than he is on real estate. Saks is projecting significant growth, and the chain wants to stay in its current warehouse as long as possible. These 700 robots could help with that—and they also don’t take coffee breaks.
-Dan Stiel
February 11th, 2010 at 12:50 pm
Dude, you CAN NOT write an article about orarge, shelf-moving robots and not post a picture!
February 11th, 2010 at 1:41 pm
Editor’s Note: Sure, we can . We just did. Seriously, there’s an answer to that. Our image library consists of symbolic images. By symbolic, I mean that we can use each image multiple times for multiple stories. To us, an image might say “E-Commerce” or POS or credit card swipe, etc. The cost for us in processing such a photo–which would almost certainly only be used once–is not something that we can do. That said, we could have linked to the vendor’s site–which has plenty of pictures of the mechanical critters–but we try and avoid linking to vendor sites unless there’s a very significant informational reason. Example: Let’s say we do a story about how the top 100 E-Commerce performed in some test. We might link to a deep page within the vendor’s site that has a grid of all of the sites and have they performed in all of the tests. But linking to a vendor site solely to display a picture of their product seemed a bad idea. But since you asked, this link is a video of the critters doing their thing. It’s also a commercial for the vendor, which is why we didn’t initially run it: http://www.youtube.com/watch?v=lWsMdN7HMuA
February 11th, 2010 at 1:43 pm
I agree with Preston. We need to see the possible devices that might replace us!
February 11th, 2010 at 2:58 pm
I respectfully disagree. You could have asked for a file photo from the company to insert in the story – I would like to think the company would have complied, since they would be credited in the photo caption. The photo should be part of your library anyway, since it probably will not be the last time you write about these devices. The cost argument you’re making does not really fly. If the expenses are what you are claiming, then you’re probably wasting money. The technology that is available should not make it such an expensive venture as you suggest.
February 11th, 2010 at 3:06 pm
Editor’s Note: Of all of the things to disagree with me, you’re choosing our internal image library policy? Ok. The costs I was referencing are not the cost of acquiring the photo. We pay those, too, but, as you point out, that wasn’t the issue here. The cost is our costs to process photos in the various sizes we need and to process them through our production system. (They’re used by the web site, newsletter and various mobile formats and they use different publishing systems.) It’s simply our policy to only process images that we’d use often. I truly doubt we’d need to use that image again. We have other images that would work–images that relate to the retail involved (as we did this time) or generic assembly line and production images. If you really care about the particular of publishing cost structure, please reach out to me privately and I’ll tell you whatever you want to know. But I am guessing that this exchange is fairly boring for 99.99 percent of our readers.