Evolution of Technology in SME Warehouses and Its Impact on Performance during Period of Uncertainty

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Evolution of Technology in SME Warehouses and Its Impact on Performance during Period of

Uncertainty

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Evolution of Technology in SME Warehouses and Its Impact on Performance during Period of

Uncertainty 2

Background

Numerous small and medium sized enterprises (SMEs) depend on technology for their

daily operations (Wong et al, 2020). Recent trends in technological advancements has eased

operational burden and even promoted security to both clients and the warehouse staff. For

instance, the implementations of technologies like programmed warehousing systems, CCTV

cameras, and e-commerce have been major technological trends that are emerging in the logistic

industry especially for the small and medium size warehouses. This trends in technology have

proven to help the organizations in operating efficiently especially during uncertain times for

example the COVID-19 pandemic, a global outbreak of the novel corona virus (Watkins, 2020).

In this research study, we aim to develop a conceptual prototypical using an Technology-

Organization-Environment (TOE) framework to explore the numerous factors that influences

small and medium sized (SME) logistic companies to embrace technology (Jia et al, 2017). The

model proposes that SME warehouses implementation of technological advancements are

influenced by perceived benefits, cost, the scope of the firm, external influence (for example,

partners and competition), and the size of their firms and the performance of operations.

The main aim of this study is to discover the significance of technology adaptation in

SMEs (Small and medium business enterprises), and the how the increased use of technology

will influence their performance during a crisis (Mendy & Rahman, 2019). The data that were

used in the study were collected from 80 (United Kingdom Based) small and medium

warehouses while the analyzation of the information was done through the uses of structural

equation modeling with least squares. The results of our study proposed that the perceived

benefits, cost, the scope of the firm, external influence (for example, partners and competition),

and the size of their firms and the performance of operations (Hassan, 2017) are all essential

Evolution of Technology in SME Warehouses and Its Impact on Performance during Period of

Uncertainty 3

dynamics which influence the adoption of evolutional technology in SMEs (Small and Medium

enterprises). As a result the conclusion backing should be given for small and medium

organizations from the aspects of organization and technology to enhance the use of technology

in managing materials and clients during a crisis (COVID-19) (Bartik et al, 2020). In order to

measure the impact of technology in this study, the use of Automatic Warehousing Systems

(AWS) will be the proposed software (Boysen et al, 2019).

Introduction

Currently numerous industries including manufacturing, retail and even logistic

companies have incorporated the Automatic warehousing system (AWS) software in their daily

operations. Specific to this study we will experiment this software as a kind of evolutionary

technological trend, which is essential for small and medium size enterprises (SMEs) in an

uncertain environment through the creation of stability worth (Egger, 2020). There is a limited

supply of factors of production especially land in the recent years and the most affected

enterprises were mostly the smaller and medium sized ones. As a result of the scarcity of these

resources there has been a surge of demand for the frequent and concurrent development of

Automatic Warehousing Systems (AWS) using robotics and information. This software is

heavily connected to client and material management hence it is greatly utilized in different areas

including management of traffic. The software reduces the operational cost and energy while at

the same time increases performance and the overall intelligence of an enterprise. When it comes

to the improvisation of supply chain efficiency the Automatic Warehousing Systems software

plays a key role. Warehousing business is often referred to as logistic companies which hold an

essential role in the supply chain and also business competition. Additionally, the global

economic progress is accredited to logistic companies. The logistics sector has a positive impact

Evolution of Technology in SME Warehouses and Its Impact on Performance during Period of

Uncertainty 4

on economic growth. With the COVID-19 pandemic, most consumers preferred online shopping

in 2020, resulting in a total of 22 billion monthly e-commerce transactions (Abdillah, 2020). The

number of people buying goods and services online has risen dramatically from the previous year

(2019), when just 1.92 billion people did so (Huang et al, 2019).

There is a rapid development of E-commerce in the world especially in warehousing

industries providing a high efficiency for peoples’ advantage through automated techniques and

equipment (Vilken et al, 2019). For instance, the delivery of goods and customer interactions by

courier warehouse industries are often very common; hence for their warehouse system software

there is need for it to be accurate and fast. However, not all warehouses have a first-hand access

to goods especially the SMEs (Small and Medium businesses) hence the optimization of the floor

operations is critical. The SMEs current resources face numerous challenges in improving their

rate of manpower and organisational efficiency, client service, time, demand prediction and

stock management. Technological evolution is frequently used to reduce such challenges

especially the Automated Warehousing software. The use of Automatic Warehousing Systems

(AWS) is a current trend in warehousing industries although IT (Information Technology) was

initially used by the industries. Currently there is a wide use of internet with an estimate of

59.9% of the global population which is 4.66 Billion individuals as of 2020 (Setti & Wanto,

2019). The internet is highly accredited for the promotion of IT utilization and solid business

performance in uncertain times (Setti & Wanto, 2019). The increased number of internet users

and the invention of smart technological gadgets clients are embracing e-commerce which is

very efficient because they are not restricted by operational hours. In 2019, during the onset of

the novel COVID-19 virus many businesses were shut down and customers were required to turn

to online stores to access essential services and goods (Gao et al, 2020). Due to the increased

Evolution of Technology in SME Warehouses and Its Impact on Performance during Period of

Uncertainty 5

online orders client service staff at small and medium business (SME) are overwhelmed by the

large number of pending orders that require immediate action fast. Supply chain anatomy usually

involves the shipment of finished goods from the manufacture to the warehouses and from the

warehouses to consumers. Hence, the efficiency of logistic industries (Warehouses) has an

essential role on delivery and storage of products. Additionally, staying ahead in a competing

market SME warehouses need to upgrade their designs, operations and distribution networks and

hence to cut down on cost and time the use of technology is important. The introduction of AWS

(Automatic Warehouse Systems) is regarded as a sign of the rise of great technology industries

for the movement of goods (Mirzaei & De Kosta, 2021). Despite the worldwide lockdown of

numerous countries around the Globe in 2020, the logistic industry has still managed to grow