The move towards automation across industries will reduce the dependence on manual labour and increase the capacity of the materials handling sector, while placing even more pressure on unproductive and unreliable labour, notes Sapics president Cobus Rossouw.

Sapics director Liezl Smith points out that, owing to the initial investment needed for automation, companies will gradually introduce automated machinery into the materials handling industry.

“It is difficult for materials handling companies to get approval to spend large sums of money; therefore, equipment rental options will need to be considered,” she adds.

Smith notes that a shift towards automation may contribute to making South Africa more competitive worldwide, as the country currently has a low ranking with regard to productivity levels.

She stresses, however, that the price of automation will be significant, as the country is labour intensive owing to the available labour force. Therefore, automation will be detrimental to the already fragile employment situation.

“A complete move towards automation is unlikely to happen, as trade unions will stop or slow down the implementation of anything that will negatively affect their members,” she adds.

Rossouw notes that while job losses, as a result of automation, are negative, labour needs to adjust to modernisation and become more productive.

Smith concurs, adding that South Africa needs to become more competitive on a global scale, failing which, more people will lose their jobs if products can be obtained more cheaply from other countries.

“Many commentators believe that the latest round of wage increases will prompt mining companies and even farmers to pursue mechanisation with greater vigour,” notes Rossouw.

He adds that it might be more affordable for mines to buy mechanised equipment than to employ workers. The total life-cycle cost of technology, including maintenance over time, remains high. This must be compared with the cost of labour – that is, the current cost and the potential cost as skills are enhanced.

“Considering the ongoing increases in wages, lost time and the effort spent on wage negotiations every year, extensive automation might become a reality in the long term,” Rossouw speculates.

The reasoning is that machines are becoming more advanced and, thus, more useful. Machines also do not pose a threat in terms of labour action such as strikes. Advances in robotic technology, therefore, could put many jobs at risk.

“Our discussion should not be centred on whether to automate, but rather on the ways in which we can harness the human potential of the continent and the country to assist us in competing in the global market. Setting artificially high wages stifles growth in sectors that can potentially employ more people,” Smith states.

She points out that automation is a controversial issue, as government has to satisfy the needs of its constituency while stimulating growth. “The labour laws give too much power to the unions, which pushes wages up to unrealistic levels, which, in turn, closes doors on opportunities for new business and growth.”

Rossouw adds that, while machinery depreciates every year, wages increase at above-inflation levels every year and machinery does not need pension or medical aid. That said, he adds that machinery needs mechanical know-how to maintain it. “If we can upskill the labour force, we can have the best of both worlds,” he adds optimistically.

Consequently, Smith notes that allocating resources is not sufficient to solve labour issues. Smith highlights that productivity is multifaceted. “We have to become more competitive. Productivity should not be sought in machines and technology, but rather in the optimisation of processes. No matter how much you invest in technology, if your processes are fundamentally flawed, it will add cost rather than save anything.”

She notes, however, that South Africa does not always have the technical support for specialised machinery and acquiring support from overseas requires much consulting and expense.

Rossouw stresses that robotics has already changed the future of supply chains in South Africa and will continue to do so. “Robotics is not new – it is all around us. In time, it will affect more of our lives. The extent of the impact depends only on innovation.”

Sapics Conference
This year’s Sapics conference, entitled Design for Change, will run from June 2 to 4 at Sun City, in the North West province.

International supply chain engineering and consulting firm St Onge Company director of European operations Tom Bonkenburg will take an in-depth look at developments in robotics and the drivers that will affect the extent to which local and international supply chains will adopt robotic technologies.

Bonkenburg noted in a media release that, in the past century, local labour costs had increased fivefold, fuel costs tenfold and property fortyfold. These increases should have driven greater use of mechanised solutions, including that of robots; however, almost 80% of the supply chain remained manual.

“Automated and mechanised solutions have, until fairly recently, been expensive and inflexible — and people are good at doing a range of complex tasks. “We’ve also become skilled at helping people enhance their skills.

“However, robotic technology is improving by leaps and bounds,” Bonkenburg added.

This improvement in technology, coupled with business’s constant need to balance land, equipment and space expenses to achieve the optimal profit mix, could change the status quo. For example, sophisticated hybrid guided vehicles are viable in today’s vast warehouse and distribution centres, as are robotic pickers.

“This new generation of machines is flexible and can be used for several tasks; it can also be moved between sites. Robots are easily rentable, thus moving costs off the balance sheet. The conclusion: business’s ongoing need to reduce costs, while improving quality, flexibility, speed and availability, is generally supportive of the trend towards the increased use of robots across the supply chain.

“No one knows what the future really holds. The purpose of this presentation is to generate discussion and stimulate new thoughts on how supply chains could be totally changed by the introduction of a new type of technology,” Bonkenburg stated in the release.

Other confirmed speakers include University of Tennessee faculty member and noted authority on supply chains Kate Vitasek, senior project manager: analysis, integration and logistics at Boeing Steve Georgevitch and principal at Strategy PricewaterhouseCoopers Advisory, France, Joseph S Roussel.