Estimated reading time: 3 minutes, 13 seconds

Almost everything that we buy in stores; what we eat, wear or entertain ourselves with at home, go through a supply chain. This makes businesses that make these products among the top GDP contributors. However, the main problem that companies in this sector face is the high cost of moving products through a supply chain from one point to another. That is the leading reason why many companies are looking for ways to improve their supply chain processes and save money. Emerging technology is a perfect answer to this.

Thanks to the advancements in artificial intelligence (AI) and blockchain, a distributed ledger technology, augmented reality (AR), is now transforming how businesses manage supply chains. AR helps truck drivers, warehouse employees and managers to keep track of products from source to destination. It also ensures that products are tracked from the moment they leave a factory to the time they arrive at a warehouse. Augmented reality allows users to superimpose digital elements on the real-world using their devices such as tablets, computers, cellphones, and head-mounted displays or digital glasses.

AR is used in warehouses to enhance the process of locating products and package them in boxes. This has reduced the cost of the pick-and-pack process that is the most expensive part of warehousing largely because of the high costs of training. AR glasses allow rookies or new workers to navigate a warehouse and identify a specific product that they need in the shortest time possible. These glasses simplify searching and training by creating imaginary lines on the floor of a warehouse, making work easy for new employees. This can be helpful to temporary employees who are hired to help during peak holiday seasons. They are used by companies to shorten the learning curve through constant feedback on how employees are doing and where they need to improve.

AR makes picking and packing like a game where workers collect items before time lapses. It not only makes it enjoyable but also reduces errors by more than 40%. Some AR glasses are used to provide an overlay of items on shelves; therefore reducing time required to locate an item. DHL, a leader in the supply chain industry, for example, came up with Vision Picking smart glasses in its warehouses that have increased productivity by more than 15%.

Augmented reality improves workforce productivity, safety, compliance and quality of service. It offers information that the employees require at just the right time. With AR and virtual reality, supply chain specialists can handle operations from anywhere. This means that companies will not have to employ people from one location or bring a contractor to the site. Rather, they can employ remote workers who are cheaper from any part of the world without incurring additional costs needed to fly them to a job site.

The last-mile delivery to customers is one of the most expensive undertakings in logistics. Through AR however, companies can cut costs by half. A report by DHL indicates that drivers spend between 40% and 60% of their day searching their trucks for the correct boxes to be delivered. However, with the help of AR, they can eliminate this by identifying, tagging, sequencing and locating a box rather than having to remember how their vehicles were loaded and where specific boxes are found in their trucks. 

While many conversations have been around how humans will lose their jobs due to automation, it is becoming evident that automation will introduce new opportunities and make work easier for humans. AR for instance will enhance efficiency, make work safer and increase productivity.  For the supply chain, AR is gaining momentum and has shown how employing this technology will provide a return on investment in each process through reduction of errors, increasing safety, enabling collaboration, and maintaining compliance. This will be a starting point for any company that wants to compete in the future.

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Scott Koegler

Scott Koegler is Executive Editor for PMG360. He is a technology writer and editor with 20+ years experience delivering high value content to readers and publishers. 

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