Let’s talk about creative uses for pallets for a minute.
Google the phrase, and you’ll find ideas ranging from coffee tables to planters and patio swings. All very creative. You may even have one at your home.
But none are nearly as creative as the original use for pallets—moving unit loads from one location to another. Today, we take that for granted. But that certainly wasn’t the case in the mid-1940s.
In 1945, the U.S. Navy was still in the early stages of loading palletized cargo on its ships. The new Ford assembly plant in Buffalo was one of the first built around the idea of palletized unit handling. Two years later, unit load handling at the plant accounted for only a third of all incoming materials. That number continued to rise over time.
In between those two milestones in pallets, a new magazine, The Palletizer, was launched in Boston. Norman Cahners had a patent on a four-way pallet and had received the rights to the magazine from the Navy, where he had supervised war ship pallet loading. His original idea was to use the magazine to help sell his pallets.
Most fortunately, Norman was a visionary and had more than 40 x 48 pallets on his mind. After just a couple of issues, the magazine was renamed Modern Materials Handling.
With that, a new American industry was off and running. And here we are 75 years later.
While not there for the launch of Modern, I did start with the magazine roughly in the middle of the past 75 years—1984, to be precise. Joining the flagship magazine of Cahners Publishing was a big deal to me then. Being associated with it still is. Modern has long been the voice of the industry, and like me, many editors have stayed around for quite some time. For instance, Mike Rowan was the editor when I arrived. He joined the magazine the year I was born, 1953.
Since the early days of Modern, the industry has gone through many eras. An early one was mechanization and work measurement practices. They were seen as the only practical way to keep pace with rising demand for U.S. products through increased efficiency.
Not everyone was thrilled. As leader of the Teamsters in 1959, Jimmy Hoffa tried to unite 50 labor unions to push for halting workplace mechanization and work measurement practices across the country. Bobby Kennedy, a former U.S. Senate investigating attorney at the time, was quoted in Modern saying such a move would be “far, far more dangerous to the U.S. and its economy than all the Mafia and secret organizations combined.”
Automatic handling ranged from bar codes to motorized scooters for order picking and monorails along with overhead cranes.
In 1963, Sara Lee opened an 80,000-square-foot warehouse billed as “the first completely automatic” food warehouse in the United States. Computer control of the automated storage and retrieval system (AS/RS)was the star of the show.
About the same time, General Motors installed the precursor to automatic guided vehicles (AGVs). Driverless guided tractors followed a 5,300-foot wire guidepath in the floor of the automaker’s 1-million-square-foot warehouse in Oshawa, Ontario.
By the mid-1980s, GM was relying on 424 AGVs to deliver parts and assemblies throughout Oshawa’s 2.7-million-square-foot manufacturing facility. Materials handling had certainly changed.
The day I visited Oshawa to write about that system was remarkable. Not only was the facility enormous, but seeing so many AGVs on the floor at once was awfully close to science fiction. Better yet, it all worked even though it was probably a technical stretch in so many ways.
Quite simply, computerization made it all possible. In the 1970s, the term personal computer, or PC, barely existed. However, larger, more centralized computers did along with programmable logic controllers (PLCs). The former managed overall operations while the latter provided local cell control. Together, they enabled automation and the creation of increasingly complex materials handling systems.
At the time, GM Oshawa’s AGV system epitomized the power of fast, flexible computer-integrated systems. There was even a new acronym: CIM, for computer integrated manufacturing. Then, along came radio frequency data communication (RFDC) terminals. They made possible computer-directed control of materials handling activities in real time even on lift trucks.
By the way, computers in the early 1980s were still relatively unknown to warehousing and manufacturing. Keep in mind that IBM did not introduce its first PC until 1981.
The question on everyone’s mind was: Do computers have a future in materials handling? Mike Rowan of Modern knew they did and devoted an issue to computers, how they work and what they could do. May sound self-evident now, but back then it wasn’t. That was groundbreaking journalism, and others agreed. It won a Neal Award, the Pulitzer Prize of the business-to-business press.
This opened the door to software that included manufacturing resource planning (MRP) and its next-generation version called MRP II. They orchestrated what was happening on the shop floor and naturally led to enterprise resource planning (ERP) systems for all operations.
The Quick Response movement also appeared in the late 1980s. The idea was to speed up replenishment of sold items at retailers. When the bar code on a pair of shoes at Macy’s was scanned at the checkout counter, the sale became a request for replenishment inventory back to the manufacturer. Great idea. However, retailers and manufacturers could never get past their mutual distrust.
Despite its relative failure, Quick Response was the precursor to reducing the time needed to manage and control the flow of materials. Keep in mind, that the first time the words “supply chain management” were heard was 1982, but they were not in widely used until sometime in the 1990s.
In the 1990s, the power of computerization just continued to grow as companies tried everything to improve handling efficiencies and reduce costs. At the same time, companies shifted from major automated systems to more localized automation. The systems era evolved into much more specialized solutions.
No place was this more evident than in software. Warehouse management systems (WMS) debuted. So did transportation management systems and labor systems and the like. All were the perfect complement to the big ERP systems, directing specific activities from order fulfillment to ensuring people were working on the right orders at any given time.
The combination of increased computer power and in-plant communications systems made increased mobility more possible. The first hands-free data collection system strapped on an operator’s arm moved around the facility at will. Meanwhile, AGVs gained new freedom with non-wire guidance, kind of an off-the-leash experience, but it wasn’t called that.
Perhaps the greatest materials handling achievement of the past 75 years (and maybe longer) was the Desert Storm logistics operation for the Iraq war in 1991. Bar codes, special lift trucks, pallets, specialized containers and more moved 10.5 million tons of equipment and supplies to the Gulf in six months. A plane load of supplies landed in Saudia Arabia every 11 minutes. During Vietnam, it took more than 6 years to do the same.
It was an amazing story to cover, and I had the privilege of leading the Modern team. The story took me from Boston to the Pentagon and a chance encounter with Colin Powell, chairman of the joint chiefs at the time. By the way, he wrote a celebratory piece about the accomplishments of military logisticians that introduced the Modern special issue to readers.
From there, it was on to Fort Riley, Kansas, to meet with members of the 1st Infantry, known as the Big Red One, which had just returned from Iraq. Others on the Modern team were in direct contact with Lt. Gen. Gus Pagonis, who led the military’s logistics effort to the Persian Gulf and back. For its coverage of those efforts in Desert Storm, Modern Materials Handling received another Neal honor.
By the middle of the nineties, Modern hit its 50-year anniversary. And while no one on the staff had any idea what was ahead for all of us in so many ways, neither did anyone else including the best and the brightest anywhere.
Let’s start with the foundation: supply chain. Although not used widely until the nineties, supply chain is now one of the hottest career paths anywhere. Just recently, supply chain was the No. 1 major in terms of enrolled students at the University of Tennessee.
Some of the things that we had little to no inkling of in 1996 include the Internet, smart phones, Google, e-commerce and GPS in your car. Try to live without one of them for any length of time today.
Those technologies were all the precursors to developments that are now entering the mainstream of manufacturing, warehousing and distribution—artificial intelligence, autonomous vehicles, the Internet of Things and 3-D printing. All of which is a long way from the four-way pallet.
It’s worth noting that just about the time of Modern’s 50th anniversary, the Internet started to fundamentally change our lives. Quirky bookseller Amazon was just two years old. Today, it is valued at more than $1.5 trillion.
Meanwhile, mmh.com was not even a wild hair concept. Today, you probably visit it regularly, turning a monthly publication into a daily. That’s quite a transformation in publishing.
What happened within the four walls of industry changed just as dramatically, too. Yes, warehouse management systems were taking their place along MRP and ERP, but WMS was a bit of a wild frontier among all the startups. But there was something even more important building here, a new information age that we all take for granted now.
As we crossed into the new millennium, the speeds and feeds of equipment that had been the lifeblood of a solid Modern story started to fade into the background. In time, data, software-directed work and order dynamics became the focus of stories. These reflected an entirely new world of priorities.
Manufacturers and distributors no longer called all the shots on what they made and sold. Consumers started to have more of a voice. They were having their say in many ways, and it wasn’t easy for others who had been making the decisions.
As a result, order dynamics were shifting from pallet loads and even cases to eaches that individual consumers bought, often online at Amazon and elsewhere. There was plenty of talk about brick-and-mortar stores being in peril, but that was a long way from the expected closures of 25,000 stores in 2020.
The Great Recession of 2007 to 2009 may have put a serious crimp in GDP and how much people were buying, but it sure didn’t slow down the rate of change in materials handling.
Automation of all sorts started to takeoff just to keep up with rebounding volumes and a workforce no longer so interested in working in plants and warehouses. Today, autonomous mobile robots deserve a shout out for how far they have pushed the envelope of moving inventory rapidly and safely in facilities—just to keep up. Software systems such as warehouse execution systems (WES) added still another layer of complexity and control to handling systems. But it was also a level needed to match the ever-spiraling rise of the consumer society.
There were problems along the way. In 2013 and 2014, demand for e-commerce order fulfillment outstripped its abilities to deliver. And, the Grinch watched from under too many Christmas trees. But that blip became a game changer that pushed e-commerce order fulfillment to a new level.
The next blip came just a few short months ago when Covid-19 arrived. E-commerce, which had been about 15% of retail, suddenly mushroomed to 25% or more. And there was a lot more than just toilet paper that was not as available as people wanted. The precise impact of this on the e-commerce supply chain is still to be played out in the pages of Modern Materials Handling. But the common comment here is “the five-year plan for e-commerce happened in March.”
That said, there is probably more uncertainty now about materials handling and supply chains than we entirely realize as we pass through 2020. But one thing is certain. The rate of change is not going to slow down. It will only speed up.
That makes me think back to a conversation I had with Modern’s two 30-something web editors in 2007. I asked, “What’s your biggest insecurity about the future?” Without hesitation, they both replied, “Kids who are 15 years old today.”
On to 100 years.
Gary Forger started at Modern Materials Handling in 1984. He served as editorial director until 2007. He has been a regular contributor to Modern since 2017.