Business and technology - warehouse automation

The huge rise in online shopping brings opportunities for new businesses - but also the imperative need for efficient and low-cost operations. Profit margins are squeezed for all businesses, and retailing online, rather than through expensive high street shops, provides a valuable way of achieving that cost objective - but only if the orders can be supplied efficiently. As Net-a-Porter chief executive Mark Sebba says, "If we don't focus on the customer, then we're lost. So what does the customer want? The customer wants an absolutely impeccable service and she or he wants the product really as soon as she or he can possibly get it."

So warehouse automation is one key part of success. But while the running costs of an automated system using robots is far cheaper than paying for training and wages to human resources, the investment cost to set that system up requires operations of a scale which makes that investment worthwhile. And the system selected then has to be robust enough to meet the fast-developing needs of online businesses.

These management issues are explored in an article 'Logistics - Rise of the warehouse robots'. It gives a good basis for a class discussion - can students identify three factors which would be essential in managing a move from human to automated processes, and three significant risks of such a process?