My notes as I explore various business and financial topics

Thursday, February 24, 2011

Kiva Robots of the Future Roam Zappos, Staples Warehouse Today!

The mobile robot glides through a gloomy warehouse, a soft hum emanating from its motor, its status lights -- the brightest illumination in the room.  With unerring precision, it locates its target: a shelf filled with materials requested for delivery to a human manned workstation.  The bot quickly scoots under the shelf and starts rapidly turning in place, as a screw-like jack lifts the entire shelf up an inch or two. Its cargo secured, the bot efficiently hauls off the entire shelf to the waiting human.

The mobile bot is part of the Kiva Mobile Fulfillment Center or MFC.  The Kiva system is a revolutionary advancement in warehouse management and distribution.  Its customers include Zappos, Staples, Walgreens and the Gap.

The Kiva Mobile Fulfillment Center is all about efficiency.  Some highlights
  • it consists of a fleet of autonomous, Roomba-like robots and mobile, customizable shelving units. 
  • the bots bring the item directly to a human manned workstation, greatly increasing efficiency.
  • upon arrival, a ceiling mounted laser flashes on the appropriate bin, directing the person to the proper item. 
  • up to four bots can queue up at a workstation, with each bot moving up in line as the person retrieves the item and  processes it. 

 Boston-based Kiva Systems was founded by Michael Mountz, a former executive at Webvan. Webvan was famous for attempting to provide home delivery of groceries during the boom--and failing. Although Webvan, and fellow dotcom company, Kosmos, offered delivery services that people wanted, the high price of warehouse logistics and distribution made it economically impossible. After Webvan went under, Mountz continued to wrestle with the problem. He founded Kiva Systems as a solution.

How Kiva Increases Efficiency

At Zappos, the order procurement process took anywhere from 48 minutes, up to three hours.  The Kiva System cut that down to 12 minutes.  12 minutes, everytime.

The Kiva System ran in parallel to the traditional conveyor system at a Staples distribution center. In this side by side comparison, the Kiva System doubled the efficiency of the conveyor system.

Other benefits of the Kiva System:

  • since nothing is bolted down, setting up the warehouse is much quicker.  For Zappos, they set up in 4 months vs. 1 year for a traditional warehouse. Re-configuration is also quickly achieved. Just re-program the Kiva System.  No need to tear down and rebuild a conveyor system.
  • reduction in utility costs. Lighting and climate no longer needs to be maintained for the entire warehouse. Rather the human workstations are spot cooled and lit.
  • noise reduction. Conveyors and other traditional warehouse systems make a constant racket. The Kiva bots make a packing house as quiet as a library, providing a calmer work environment and increasing productivity.
  • no single point of failure.  If a conveyor breaks down or gets jammed, than the entire production line stops. If a Kiva bot breaks down, another one quickly takes its place.

A Smart Efficient Solution to Loading / Offloading

One huge advantage of the Kiva System,  "The robot system is smart enough to bring orders to shipping docks in reverse sequence of the truck route. What that means is that when the driver goes on a delivery route and makes the first stop, the cartons for the first order `happen' to be right at the door truck - at the second stop, cartons for the second order are all unobstruc ted at the back of truck, and so on," says Mitch Rosenberg, Vice President of Marketing.

I hope to see more companies utilizing Kiva in their warehouse and distribution centers.  The Kiva MFC system is truly epic.

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