WEBVTT

00:00:00.000 --> 00:00:03.561
I want to talk to you about,

00:00:03.561 --> 00:00:07.122
or share with you, a
breakthrough new approach

00:00:07.122 --> 00:00:10.464
for managing items of
inventory inside of a warehouse.

00:00:10.464 --> 00:00:13.022
We're talking about a pick,
pack and ship setting here.

00:00:13.022 --> 00:00:15.845
So as a hint,

00:00:15.845 --> 00:00:19.998
this solution involves
hundreds of mobile robots,

00:00:19.998 --> 00:00:22.422
sometimes thousands
of mobile robots,

00:00:22.422 --> 00:00:25.020
moving around a warehouse.
And I'll get to the solution.

00:00:25.020 --> 00:00:26.240
But for a moment, just think

00:00:26.240 --> 00:00:28.766
about the last time that
you ordered something online.

00:00:28.766 --> 00:00:30.830
You were sitting
on your couch

00:00:30.830 --> 00:00:34.890
and you decided that you
absolutely had to have this red t-shirt.

00:00:34.890 --> 00:00:37.186
So — click! — you put it
into your shopping cart.

00:00:37.186 --> 00:00:39.084
And then you decided
that green pair of pants

00:00:39.084 --> 00:00:40.982
looks pretty good too — click!

00:00:40.982 --> 00:00:42.882
And maybe a blue
pair of shoes — click!

00:00:42.882 --> 00:00:44.932
So at this point you've
assembled your order.

00:00:44.932 --> 00:00:46.700
You didn't stop to think 
for a moment that

00:00:46.700 --> 00:00:48.468
that might not be a great outfit.

00:00:48.468 --> 00:00:50.238
But you hit
"submit order."

00:00:50.238 --> 00:00:54.412
And two days later, this package
shows up on your doorstep.

00:00:54.412 --> 00:00:57.366
And you open the box and you're
like, wow, there's my goo.

00:00:57.366 --> 00:01:00.327
Did you ever stop to think about
how those items of inventory

00:01:00.327 --> 00:01:04.540
actually found their way inside
that box in the warehouse?

00:01:04.540 --> 00:01:08.358
So I'm here to tell you 
it's that guy right there.

00:01:08.358 --> 00:01:11.978
So deep in the
middle of that picture,

00:01:11.978 --> 00:01:14.493
you see a classic
pick-pack worker

00:01:14.493 --> 00:01:17.718
in a distribution or
order fulfillments setting.

00:01:17.718 --> 00:01:21.600
Classically these pick workers will 
spend 60 or 70 percent of their day

00:01:21.600 --> 00:01:23.512
wandering around
the warehouse.

00:01:23.512 --> 00:01:26.223
They'll often walk
as much as 5 or 10 miles

00:01:26.223 --> 00:01:28.884
in pursuit of
those items of inventory.

00:01:28.884 --> 00:01:33.305
Not only is this an
unproductive way to fill orders,

00:01:33.305 --> 00:01:37.362
it also turns out to be an
unfulfilling way to fill orders.

00:01:37.362 --> 00:01:40.993
So let me tell you where I
first bumped into this problem.

00:01:40.993 --> 00:01:45.047
I was out in the Bay area 
in '99, 2000, the dot com boom.

00:01:45.047 --> 00:01:49.109
I worked for a fabulously
spectacular flame-out called Webvan.

00:01:49.109 --> 00:01:50.930
(Laughter)

00:01:50.930 --> 00:01:53.660
This company raised hundreds of
millions of dollars with the notion that

00:01:53.660 --> 00:01:56.442
we will deliver
grocery orders online.

00:01:56.442 --> 00:02:00.615
And it really came down to the fact
that we couldn't do it cost effectively.

00:02:00.615 --> 00:02:04.577
Turns out e-commerce was something
that was very hard and very costly.

00:02:04.577 --> 00:02:08.828
In this particular instance we were trying
to assemble 30 items of inventory

00:02:08.828 --> 00:02:12.800
into a few totes, onto a van
to deliver to the home.

00:02:12.800 --> 00:02:16.600
And when you think about it,
it was costing us 30 dollars.

00:02:16.600 --> 00:02:19.686
Imagine, we had an
89¢ can of soup

00:02:19.686 --> 00:02:23.362
that was costing us one dollar to
pick and pack into that tote.

00:02:23.362 --> 00:02:26.570
And that's before we actually
tried to deliver it to the home.

00:02:26.570 --> 00:02:29.357
So long story short,
during my one year at Webvan,

00:02:29.357 --> 00:02:32.593
what I realized by talking to 
all the material-handling providers

00:02:32.593 --> 00:02:37.231
was that there was no solution designed
specifically to solve each base picking.

00:02:37.231 --> 00:02:41.254
Red item, green, blue, getting
those three things in a box.

00:02:41.254 --> 00:02:44.239
So we said, there's just
got to be a better way to do this.

00:02:44.239 --> 00:02:46.766
Existing material handling
was set up to pump

00:02:46.766 --> 00:02:50.533
pallets and cases of
goo to retail stores.

00:02:50.533 --> 00:02:54.330
Of course Webvan went out of business,
and about a year and a half later,

00:02:54.330 --> 00:02:57.910
I was still noodling on this problem.
It was still nagging at me.

00:02:57.910 --> 00:02:59.778
And I started
thinking about it again.

00:02:59.778 --> 00:03:04.905
And I said, let me just focus briefly
on what I wanted as a pick worker,

00:03:04.905 --> 00:03:07.236
or my vision for
how it should work.

00:03:07.236 --> 00:03:08.650
(Laughter)

00:03:08.650 --> 00:03:10.572
I said, let's focus
on the problem.

00:03:10.572 --> 00:03:14.427
I have an order here and what
I want to do is I want to put

00:03:14.427 --> 00:03:16.647
red, green and blue
in this box right here.

00:03:16.647 --> 00:03:19.499
What I need is a system where I put out
my hand and — poof! —

00:03:19.499 --> 00:03:22.022
the product shows up 
and I pack it into the order,

00:03:22.022 --> 00:03:23.715
and now we're thinking,

00:03:23.715 --> 00:03:27.729
this would be a very operator-centric
approach to solving the problem.

00:03:27.729 --> 00:03:31.956
This is what I need. What technology
is available to solve this problem?

00:03:31.956 --> 00:03:35.897
But as you can see, orders can come
and go, products can come and go.

00:03:35.897 --> 00:03:40.580
It allows us to focus on making the
pick worker the center of the problem,

00:03:40.580 --> 00:03:45.204
and providing them the tools to make
them as productive as possible.

00:03:45.204 --> 00:03:47.304
So how did I
arrive at this notion?

00:03:47.304 --> 00:03:50.837
Well, actually it came from
a brainstorming exercise,

00:03:50.837 --> 00:03:53.677
probably a technique
that many of you use,

00:03:53.677 --> 00:03:55.833
It's this notion of
testing your ideas.

00:03:55.833 --> 00:03:57.563
Take a blank sheet, of course,

00:03:57.563 --> 00:04:01.593
but then test your ideas
at the limits — infinity, zero.

00:04:01.593 --> 00:04:04.775
In this particular case, we
challenged ourselves with the idea:

00:04:04.775 --> 00:04:07.751
What if we had to build a
distribution center in China,

00:04:07.751 --> 00:04:10.365
where it's a very,
very low-cost market?

00:04:10.365 --> 00:04:13.578
And say, labor is cheap,
land is cheap.

00:04:13.578 --> 00:04:15.224
And we said specifically,

00:04:15.224 --> 00:04:18.230
"What if it was zero dollars
an hour for direct labor

00:04:18.230 --> 00:04:20.946
and we could build a million-
square-foot distribution center?"

00:04:20.946 --> 00:04:23.021
So naturally that
led to ideas that said,

00:04:23.021 --> 00:04:24.829
"Let's put lots of people
in the warehouse."

00:04:24.829 --> 00:04:27.374
And I said, "Hold on,
zero dollars per hour,

00:04:27.374 --> 00:04:30.231
what I would do is 'hire'

00:04:30.231 --> 00:04:34.358
10,000 workers to come to the
warehouse every morning at 8 a.m.,

00:04:34.358 --> 00:04:37.477
walk into the warehouse and
pick up one item of inventory

00:04:37.477 --> 00:04:39.210
and then just stand there.

00:04:39.210 --> 00:04:41.749
So you hold Captain Crunch,
you hold the Mountain Dew,

00:04:41.749 --> 00:04:43.172
you hold the Diet Coke.

00:04:43.172 --> 00:04:45.428
If I need it, I'll call you,
otherwise just stand there.

00:04:45.428 --> 00:04:48.815
But when I need Diet Coke and I call it,
you guys talk amongst yourselves.

00:04:48.815 --> 00:04:52.936
Diet Coke walks up to the front —
pick it, put it in the tote, away it goes."

00:04:52.936 --> 00:04:57.588
Wow, what if the products
could walk and talk on their own?

00:04:57.588 --> 00:04:59.926
That's a very interesting,
very powerful way

00:04:59.926 --> 00:05:02.520
that we could potentially
organize this warehouse.

00:05:02.520 --> 00:05:04.868
So of course,
labor isn't free,

00:05:04.868 --> 00:05:08.176
on that practical
versus awesome spectrum.

00:05:08.176 --> 00:05:09.866
(Laughter)

00:05:09.866 --> 00:05:12.983
So we said mobile shelving —
We'll put them on mobile shelving.

00:05:12.983 --> 00:05:17.776
We'll use mobile robots and
we'll move the inventory around.

00:05:17.776 --> 00:05:22.194
And so we got underway on that and
then I'm sitting on my couch in 2008.

00:05:22.194 --> 00:05:26.013
Did any of you see the Beijing
Olympics, the opening ceremonies?

00:05:26.013 --> 00:05:29.054
I about fell out of my
couch when I saw this.

00:05:29.054 --> 00:05:30.527
I'm like, that was the idea!

00:05:30.527 --> 00:05:35.026
(Laughter and Applause)

00:05:35.026 --> 00:05:38.917
We'll put thousands of people on
the warehouse floor, the stadium floor.

00:05:38.917 --> 00:05:42.952
But interestingly enough, this
actually relates to the idea

00:05:42.952 --> 00:05:48.364
in that these guys were creating some
incredibly powerful, impressive digital art,

00:05:48.364 --> 00:05:50.440
all without computers,
I'm told,

00:05:50.440 --> 00:05:52.886
it was all peer-to-peer
coordination and communication.

00:05:52.886 --> 00:05:54.462
You stand up,
I'll squat down.

00:05:54.462 --> 00:05:56.107
And they made
some fabulous art.

00:05:56.107 --> 00:05:58.795
It speaks to the
power of emergence

00:05:58.795 --> 00:06:02.763
in systems when you let things
start to talk with each other.

00:06:02.763 --> 00:06:06.541
So that was a little
bit of the journey.

00:06:06.541 --> 00:06:10.579
So of course, now what became
the practical reality of this idea?

00:06:10.579 --> 00:06:12.385
Here is a warehouse.

00:06:12.385 --> 00:06:16.161
It's a pick, pack and ship center
that has about 10,000 different SKUs.

00:06:16.161 --> 00:06:20.298
We'll call them red pens,
green pens, yellow Post-It Notes.

00:06:20.298 --> 00:06:23.677
We send the little orange robots
out to pick up the blue shelving pods.

00:06:23.677 --> 00:06:25.845
And we deliver them
to the side of the building.

00:06:25.845 --> 00:06:28.981
So all the pick workers now
get to stay on the perimeter.

00:06:28.981 --> 00:06:31.323
And the game here is
to pick up the shelves,

00:06:31.323 --> 00:06:34.647
take them down the highway and
deliver them straight to the pick worker.

00:06:34.647 --> 00:06:36.784
This pick worker's life
is completely different.

00:06:36.784 --> 00:06:40.201
Rather than wandering around
the warehouse, she gets to stay still

00:06:40.201 --> 00:06:41.789
in a pick station like this

00:06:41.789 --> 00:06:45.787
and every product in the
building can now come to her.

00:06:45.787 --> 00:06:49.065
So the process
is very productive.

00:06:49.065 --> 00:06:53.260
Reach in, pick an item,
scan the bar code, pack it out.

00:06:53.260 --> 00:06:54.909
By the time
you turn around,

00:06:54.909 --> 00:06:57.948
there's another product there
ready to be picked and packed.

00:06:57.948 --> 00:07:00.958
So what we've done is take
out all of the non-value added

00:07:00.958 --> 00:07:03.642
walking, searching,
wasting, waited time,

00:07:03.642 --> 00:07:07.920
and we've developed a very 
high-fidelity way to pick these orders,

00:07:07.920 --> 00:07:12.084
where you point at it with
a laser, scan the UPC barcode,

00:07:12.084 --> 00:07:15.278
and then indicate with a light
which box it needs to go into.

00:07:15.278 --> 00:07:18.764
So more productive, more
accurate and, it turns out,

00:07:18.764 --> 00:07:23.070
it's a more interesting office
environment for these pick workers.

00:07:23.070 --> 00:07:25.507
They actually complete
the whole order.

00:07:25.507 --> 00:07:28.034
So they do red, green and blue,
not just a part of the order.

00:07:28.034 --> 00:07:31.648
And they feel a little bit more
in control of their environment.

00:07:31.648 --> 00:07:34.846
So the side effects
of this approach

00:07:34.846 --> 00:07:36.414
are what really surprised us.

00:07:36.414 --> 00:07:37.992
We knew it was going 
to be more productive.

00:07:37.992 --> 00:07:42.062
But we didn't realize just how
pervasive this way of thinking

00:07:42.062 --> 00:07:47.292
extended to other
functions in the warehouse.

00:07:47.292 --> 00:07:52.124
But what effectively this approach
is doing inside of the DC

00:07:52.124 --> 00:07:56.588
is turning it into a massively
parallel processing engine.

00:07:56.588 --> 00:07:59.211
So this is again a
cross-fertilization of ideas.

00:07:59.211 --> 00:08:01.150
Here's a warehouse
and we're thinking about

00:08:01.150 --> 00:08:04.669
parallel processing
supercomputer architectures.

00:08:04.669 --> 00:08:07.066
The notion here is that you have

00:08:07.066 --> 00:08:09.863
10 workers on 
the right side of the screen

00:08:09.863 --> 00:08:14.111
that are now all independent
autonomous pick workers.

00:08:14.111 --> 00:08:18.015
If the worker in station three decides
to leave and go to the bathroom,

00:08:18.015 --> 00:08:21.499
it has no impact on the
productivity of the other nine workers.

00:08:21.499 --> 00:08:25.869
Contrast that, for a moment, with the
traditional method of using a conveyor.

00:08:25.869 --> 00:08:27.928
When one person
passes the order to you,

00:08:27.928 --> 00:08:30.427
you put something in
and pass it downstream.

00:08:30.427 --> 00:08:33.544
Everyone has to be in place
for that serial process to work.

00:08:33.544 --> 00:08:36.721
This becomes a more robust
way to think about the warehouse.

00:08:36.721 --> 00:08:41.265
And then underneath the hoods gets
interesting in that we're tracking

00:08:41.265 --> 00:08:43.003
the popularity
of the products.

00:08:43.003 --> 00:08:45.827
And we're using dynamic
and adaptive algorithms

00:08:45.827 --> 00:08:50.281
to tune the floor
of the warehouse.

00:08:50.281 --> 00:08:55.165
So what you see here potentially
the week leading up to Valentine's Day.

00:08:55.165 --> 00:08:59.008
All that pink chalky candy has
moved to the front of the building

00:08:59.008 --> 00:09:02.901
and is now being picked into a
lot of orders in those pick stations.

00:09:02.901 --> 00:09:07.064
Come in two days after Valentine's Day,
and that candy, the leftover candy,

00:09:07.064 --> 00:09:09.337
has all drifted to the
back of the warehouse

00:09:09.337 --> 00:09:13.630
and is occupying the cooler
zone on the thermal map there.

00:09:13.630 --> 00:09:17.113
One other side effect of this
approach using the parallel processing

00:09:17.113 --> 00:09:20.108
is these things can
scale to ginormous.

00:09:20.108 --> 00:09:21.635
(Laughter)

00:09:21.635 --> 00:09:24.369
So whether you're doing
two pick stations, 20 pick stations,

00:09:24.369 --> 00:09:27.642
or 200 pick stations, the
path planning algorithms

00:09:27.642 --> 00:09:30.185
and all of the inventory
algorithms just work.

00:09:30.185 --> 00:09:34.541
In this example you
see that the inventory

00:09:34.541 --> 00:09:36.867
has now occupied all the
perimeter of the building

00:09:36.867 --> 00:09:39.213
because that's where
the pick stations were.

00:09:39.213 --> 00:09:41.231
They sorted it
out for themselves.

00:09:41.231 --> 00:09:43.518
So I'll conclude with
just one final video

00:09:43.518 --> 00:09:46.502
that shows how
this comes to bear

00:09:46.502 --> 00:09:50.096
on the pick worker's actual
day in the life of.

00:09:50.096 --> 00:09:54.432
So as we mentioned, the process is
to move inventory along the highway

00:09:54.432 --> 00:09:57.084
and then find your way
into these pick stations.

00:09:57.084 --> 00:09:59.555
And our software in the background

00:09:59.555 --> 00:10:02.306
understands what's going on 
in each station,

00:10:02.306 --> 00:10:04.917
we direct the pods
across the highway

00:10:04.917 --> 00:10:07.631
and we're attempting to
get into a queuing system

00:10:07.631 --> 00:10:10.515
to present the work
to the pick worker.

00:10:10.515 --> 00:10:13.760
What's interesting is we can even
adapt the speed of the pick workers.

00:10:13.760 --> 00:10:17.686
The faster pickers get more pods
and the slower pickers get few.

00:10:17.686 --> 00:10:20.824
But this pick worker now is
literally having that experience

00:10:20.824 --> 00:10:22.677
that we described before.

00:10:22.677 --> 00:10:25.221
She puts out her hand.
The product jumps into it.

00:10:25.221 --> 00:10:27.426
Or she has to reach in and get it.

00:10:27.426 --> 00:10:29.871
She scans it and 
she puts it in the bucket.

00:10:29.871 --> 00:10:33.667
And all of the rest of the technology
is kind of behind the scenes.

00:10:33.667 --> 00:10:37.528
So she gets to now focus on the
picking and packing portion of her job.

00:10:37.528 --> 00:10:40.802
Never has any idle time,
never has to leave her mat.

00:10:40.802 --> 00:10:44.942
And actually we think
not only a more productive

00:10:44.942 --> 00:10:48.212
and more accurate
way to fill orders.

00:10:48.212 --> 00:10:51.622
We think it's a more
fulfilling way to fill orders.

00:10:51.622 --> 00:10:54.830
The reason we can say
that, though, is that workers

00:10:54.830 --> 00:10:56.972
in a lot of these
buildings now compete

00:10:56.972 --> 00:11:00.154
for the privilege of working
in the Kiva zone that day.

00:11:00.154 --> 00:11:02.817
And sometimes we'll catch
them on testimonial videos

00:11:02.817 --> 00:11:04.934
saying such things as,

00:11:04.934 --> 00:11:09.180
they have more energy after the
day to play with their grandchildren,

00:11:09.180 --> 00:11:13.776
or in one case a guy said, "the
Kiva zone is so stress-free

00:11:13.776 --> 00:11:16.891
that I've actually stopped taking
my blood pressure medication."

00:11:16.891 --> 00:11:18.725
(Laughter)

00:11:18.725 --> 00:11:22.724
That was at a pharmaceutical distributor,
so they told us not to use that video.

00:11:22.724 --> 00:11:26.292
(Laughter)

00:11:26.292 --> 00:11:29.316
So what I wanted to leave you
with today is the notion that

00:11:29.316 --> 00:11:32.171
when you let things start
to think and walk

00:11:32.171 --> 00:11:37.462
and talk on their own, interesting
processes and productivities can emerge.

00:11:37.462 --> 00:11:40.403
And now I think next time
you go to your front step

00:11:40.403 --> 00:11:42.914
and pick up that box that
you just ordered online,

00:11:42.914 --> 00:11:45.138
you break it open and
the goo is in there,

00:11:45.138 --> 00:11:47.891
you'll have some wonderment
as to whether a robot

00:11:47.891 --> 00:11:50.484
assisted in the picking
and packing of that order.

00:11:50.484 --> 00:11:52.163
Thank you.

00:11:52.163 --> 00:11:56.793
(Applause)