Visy is set to embark on a major transformation that will see it incorporate a mix of artificial intelligence, IT and robotics "into every aspect" of its packaging, paper making and recycling businesses.
Chairman Anthony Pratt told the AWS Summit in Sydney yesterday that the company had recently created an “industrial technology and digital hub” in Singapore to lead the work.
Pratt said the hub’s brief “is to incorporate AI, IT and robotics globally”.
“We want to use technology to help us do a better job of looking after our customers, lowering our costs and innovating, but it has to be the right source of innovation,” he said.
“It’s always important not to just go for the cool things in technology but the ones that have the fastest payback [and] where there’s sufficient margin [for] error.”
Pratt said that the company would “soon have one of the only fully-automated corrugated factory warehouses employing robotic driverless forklifts”.
“Beyond that we have a vision which I call the ‘lights out’ factory - a fully-automated box factory that operates in the dark because robots don’t need lights,” he said.
However, he hastened to add, “our natural growth will still mean that we will employ more and more people every year”.
Pratt said that claims of the death of Australian manufacturing were premature.
“It wasn’t too long ago that economists were predicting the death of manufacturing in countries like Australia and America because they couldn’t compete with low costs in Asia,” he said.
“I beg to differ. I can even see a scenario where countries like Australia and America with the best brains and best resources are where the manufacturing is because robots make labour costs irrelevant.”
Pratt saw the cloud as a key vector in which IT could innovate and keep Visy relevant and competitive.
Visy has been in a private cloud since 2010. In 2016, it migrated its core SAP system to run in AWS, making it - in Pratt’s words - “run up to ten times faster” while lowering costs by 30 percent.
The company is now looking more broadly at trials of technology across the AWS portfolio.
“For example, we’re now trialling additional services including machine learning to help with our sales and OH&S data,” he said.
“Energy is also a huge cost for us, and so we are trialling artificial intelligence to bring down our energy usage.
“We’re also actively exploring ways that AWS can help us move closer to advanced automation and robotics.”
Sensing for Amazon packaging
Pratt also revealed that Visy is hoping to incorporate more technology into the cardboard boxes it supplies to Amazon.com to ship products that consumers purchase.
Visy had supplied corrugated boxes to Amazon for the past two decades.
“We’ve been selling boxes to Amazon in America since 1999, virtually since they started,” he said.
“We’ve been honoured to be given the same opportunity in Australia.
“But we know that to remain relevant and competitive to Amazon, we need to be at the forefront of manufacturing technology, IT, AI, customer service and product innovation.
“Our relationship with AWS is a key to that vision.”
Pratt said that Visy had already supplied packaging innovations such as “custom-made, fit-for-purpose boxes to keep fresh food cooler” for AmazonFresh in the United States.
The retail and food industry speculated over the course of last year whether AmazonFresh would launch in Australia.
Some analysts believe it could successfully take market share from the major supermarkets.
Pratt saw further opportunity to drive innovation into the packaging it supplies to Amazon.
“We’re looking into packaging that contains far more than just a barcode, like traceability showing where the box has been, or how hot it’s got in the box, which is very important to fresh food shipments,” he said.
“We’re [also] not far away from seeing packaging that can even monitor its contents in the consumer’s home and automatically trigger a re-order.
“Or a box that might provide proof of origin and supply chain integrity, so a mother who buys infant formula for her baby knows exactly what she’s getting and when she ordered it and that it’s not an inferior copy.”
Visy said that working with Amazon had inspired the company - which Pratt admitted is in an otherwise “slow-ish industry” sector - to “be not just a box supplier but a total packaging supplier”.
“Logistics is an opportunity to improve the customer experience and lower costs, which will enable Amazon to reduce prices further,” he said.
“We want to actively innovate with Amazon on this.”