Amazons biggest, newest warehouse, with more robots than ever, brings America closer to an automated future when

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Amazon’s biggest, newest warehouse, with more robots than ever, brings America closer to an automated future when machines do all the work of moving everything from groceries to laptops, from makers to users. And do it faster. While Amazon has been building increasingly automated warehouses since opening its first satellite center in 1997, five miles down the road in New Castle, Del., this $250 million showcase is something entirely different.

Inside the five-story plant — as big as 17 football fields, or four of Philadelphia’s tallest high rises — an electromechanical ballet performed by robots takes place in an eerie quiet. Robot vehicles, guided by optical and motion sensors, make turns tightly adjacent to one another, selecting and carrying Amazon’s vast array of merchandise from storage to delivery. There are still workers unloading trucks from suppliers and stowing the contents — not in vast shelves for hands to grab but in eight-foot-tall stacks of square yellow bins. Once within these, goods begin their robotic travels.

Does that 10-1 ratio spell an end to the massive hiring that has made warehouse work at double the minimum wage so widely available in recent years? Amazon and its admirers are a little sensitive on this point, so it’s worth noting upfront: Amazon is still hiring, not just because so many workers don’t last a year, but also because its service is so popular that it keeps building more centers, adding people to run them, doing things robots still can’t. For now.

Amazon employed 1.3 million employees worldwide last year, up from 800,000 a year earlier. Among
U.S. companies, only rival Walmart, with all its stores, employs more. To be sure, some critical economists say Amazon destroys more jobs than it creates. Other analysts say that labor-saving has always been the goal of new technology. In any event, Will Carney, the plant’s manager here, said, “Our hiring is not quite done.”

The facility is in a “ramp-up” stage, and may eventually employ as many as 4,000 to 5,000 workers, as the work expands over the next several years, according to spokesman Steve Kelly.

Amazon hopes it will be easier to keep human workers this winter, when the company has pledged to start providing workers up to $5,250 a year toward colleges costs. It may also add robots and employees in Delaware, though Amazon won’t detail its longer-term plans for the facility.
The staff, as much as it has grown since opening this summer, is still fewer than Amazon employs at fulfillment centers one-quarter this size.

The facility is the flagship of a sweeping expansion by Amazon across the Philadelphia region. Amazon has plans to open as many as nine new facilities in the coming months. That’s on top of the 14 sites added last year across Philadelphia and its suburbs, the Lehigh Valley, South Jersey, and northern Delaware.

Amazon said automation frees workers from dull, repetitive tasks. But workers have complained that automated production has been accompanied by speed-ups and a higher-than-average rate of injuries. Why Delaware? It helps that the state gave the company, whose profits top $2 billion a month, about
$4.5 million in up-front aid, while the local government cut realty taxes to a fraction of what GM paid. Wilmington’s proximity to workforces in Maryland, New Jersey, and Philadelphia’s southern suburbs helped, too.

“They try to find locations they can run at lower cost,” Kumar said. (Amazon officials say the plant’s proximity to the Port of Wilmington, airports, and on-site railroad sidings don’t matter, since cargo goes in and out by truck.) “I call these very large plants the ‘motherships,’” said Brittain Ladd, a former Amazon logistics executive turned automation consultant.

Ladd said Amazon’s latest expansion draws upon location and system-management lessons from its highly profitable Amazon Web Services network of services to corporations. He sees accelerating automation as inevitable. “During the pandemic a lot of people decided they don’t want to spend 20 or 30 years working in a fulfillment center,” Ladd said. “Amazon may employ a million people. But turnover in some places is nearly 100% a year. They can’t hire enough people. They have no choice but to invest in automation and robotics.”

Amazon bought Kiva, which developed the robots deployed in Delaware and elsewhere, eight years go
— and, thinking ahead, stopped supplying Gap and other retailers with Kiva machines as if to forestall competition and keep the savings for itself, Kumar said. Ladd expects the robotics arms race to accelerate, with Amazon forcing competitors to upgrade. “In the long run, if they are not going to innovate and automate, they will not survive,” said Temple’s Kuma. “Amazon is moving very fast.”

Questions

Q.1.1 Argue in favour of Amazon’s decision to utilise more robots in their warehouse
operations. (5)

Q.1.2 Amazon is embracing automation with robotics. Examine Levels of automation and information technology (IT) functionality in relation to Amazon. (10)

Note: you are required to discuss the relevant theory in your own words before you
apply it to Amazon. More marks will be awarded for theory that is paraphrased.

Q.1.3 Considering the concept of levels of automation and information technology functionality, argue in favour of the statement made by Amazon’s former logistics executive turned automation consultant, where he sees accelerating automation as inevitable.

Note: you are required put forward at least two key points, that are underpinned by theory. Ensure that the relevant theory is stated in your own words before you apply
it to Amazon. More marks will be awarded for theory that is paraphrased. (10)

Q.1.4 Analyse how automation at Amazon can assist with sorting and packing to create efficiencies.

Note: you are required to discuss the relevant theory in your own words before you apply it to Amazon. More marks will be awarded for theory that is paraphrased. (10)