I used to try hard to imagine how the inventory warehouse and
the life of workers working there to fulfill the orders are like for big e-commerce
companies like Amazon and Ebay. Amazon now has 52 existing warehouses in the
U.S and has plan to opening more. For each warehouse, hundreds of workers are
employed. A packing employee “has to walk 10 or more miles a day” just picking
and dropping stuffs-tedious, unproductive and constitutes a great non-value
adding cost for Amazon. With the age of
information and technology, a solution for this should be out there.
I did some search and then came across this interesting 10
minutes Ted-Talk delivered by Mick Mountz, the founder of Kiva System (http://www.kivasystems.com).
Mick, learning from his prior unsuccessful ecommerce startup
due to high warehousing costs, revolutionized the way inventories are
managed. He invented autonomous mobile
robots and utilized sophisticated algorithm to control them. Using his own
words “now the inventory can talk and walk” . Theses robots are like mobile
shelves and they can “store, move and sort the inventory and then come to the
pieceworker” [1]Kiva
System can help big e-commerce companies to fulfill orders in a highly
efficient and effective manner. With this system in place, there is no need to
hire thousands of people doing unfulfilling work and accuracy of order fulfillment gets improved too.
Moreover, this technology and algorithm can be constantly improved. The robots
now can even help with gift wrapping.
While I was watching the video, I am so convinced that Kiva
is indeed a game-changer and I was thinking if I owned a company that requires
intensive distributing and packing work like this, I would definitely get that
technology. Unsurprising, Amazon bought
the company last year for $775 million in cash, making the deal the
second-largest acquisition in Amazon’s acquisition[2]
history. So we can anticipate that
Amazon will embrace a higher level of automation in its oder fulfillment process in the future. Let’s wait and
see what transformation Kiva System will bring to Amazon.
Brilliant idea~
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