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Robots versus humans in the supply chain – who wins?

Robots versus humans in the supply chain – who wins?

19 Jan 2017

Countless unskilled jobs are expected to be usurped by robots over the next couple of decades, with labour scarcity and higher wage cost across markets being the main drivers. But there will always be a place for people – if they don’t stagnate.

By 2020, robots will reach human levels of intelligence and have the ability to process information billions of times faster, according to Paul W Bradley, chairman and CEO at Caprica International and vice chairman of the Supply Chain Asia board.

Even more knee jerking is that by 2025, as many as 30 percent of jobs could potentially be displaced by robotics and technology, Bradley said.

Thanks to the productivity boost robotics promises to deliver, automated machines can be increasingly found in supply chains around the world. Not only are they making routine tasks more efficient; labour gaps are also being filled.

In developed economies, robots are taking over blue-collar jobs that are being shunned by the highly skilled, while in fast-growing markets such as China and India, they are being deployed to keep pace with spikes in consumer demand.

Limitations of technology

Despite their widespread use, panellists at the recent Supply Chain Asia Forum were unanimous in their views that humans would still be irreplaceable in the flow of goods from source to customer.

Piece picking in the warehouse is one example where the human touch is still needed. “It is challenging to programme flexibility into a robot,” observed Lim Yun Fong, associate professor of operations management at Singapore Management University (SMU). “It can never cope with all kinds of situations.”

Unlike case picking, piece picking continues to be done manually even in advanced countries such as the United States because robots cannot identify the varying shapes and sizes of pieces.

“Humans will also always be needed to make supervisory and exceptional decisions”, said Chew Ek Peng, associate professor of industrial and systems engineering at the National University of Singapore (NUS). He highlighted the example of how an automated guided vehicle (AGV) system deployed in the Rotterdam port faces deadlocks from time to time. When AGVs end up blocking one another because of sequencing priority, humans have to step in to resolve the situation.

Are there larger repercussions?

Artificial intelligence (AI), the science of making smart machines, is now evolving at such a rate that it could grow into an actual threat.

In January, world-renowned physicist Stephen Hawking, Apple co-founder Steve Wozniak and Tesla Motors CEO Elon Musk signed a letter along with many others stating that it was time to focus research on how to reap its benefits while avoiding potential pitfalls. Examples of adverse effects include increased inequality and unemployment.

Increasing the use of robots could lead to localisation as developed nations may start manufacturing again, causing goods from manufacturing countries in Asia to be redundant.

As the cost of robots decreases and becomes comparable with labour costs in developing nations, first-world countries may pull back manufacturing to their own countries, leaving third-world countries in a loss.

“Developed countries now do a lot of importing and developing countries are exporting, but the situation might be reversed,” said NUS’ Chew. Advanced automation can lead to economic and trade disparity, he added.

Another problem is that while economies with highly skilled workers are likely to be able to adapt to the new technology, masses of workers whose jobs can be automated will become redundant.

“In developed nations like Singapore, technology will be used to overcome labour shortages, but what about countries that don’t have labour shortages?” asked Caprica International’s Bradley. “There are 800 million unemployed people in the world today, and a lot of them are in the developing world.”

Future-proofing the workforce

What we do know now is that as workplaces around the world adopt emotionless robots, jobs that require a human touch will certainly be in higher demand. In a Pew Research Center report on AI, robotics and the future of jobs, respondents argued that “many jobs require uniquely human characteristics such as empathy, creativity, judgment, or critical thinking – and that jobs of this nature will never succumb to widespread automation”.

The rise of robots will also create new jobs as people are needed to service and programme the machinery. Amy Webb, CEO of strategy firm Webbmedia Group, said in the same report: “There is a general concern that the robots are taking over. I disagree that our emerging technologies will permanently displace most of the workforce, though I’d argue that jobs would shift into other sectors. Now more than ever, an army of talented coders is needed to help our technology advance…”

One of the key themes that emerged from the report was the importance of taking a hard look at educational systems to ensure they adequately prepare workers for jobs of the future.

“We need to train people both in our industries and universities for jobs that do not exist,” Bradley added. “Every job is going to have to be redesigned due to technology. So we need to teach skills that are evolvable rather than predictable.

“Human knowledge used to double every thousand years, then every hundred years. Today all available knowledge doubles every three to four years and the most dangerous place to be is in the comfort zone.”