Synergizing automation and human capital: a strategic model for productivity enhancement in retail warehousing

Abstract

The research addresses the critical need for operational efficiency and international competitiveness in the modern logistics sector through the perspective of warehouse automation. While global trends move toward smart warehousing, many companies face hesitancy due to high initial investment costs and concerns regarding workforce displacement. This research employs a mixed-methods approach, combining qualitative expert interviews with quantitative financial analysis, to develop a three-phased strategic model for retail companies in Latvia. The model integrates automated sorting systems with a primary focus on workforce reskilling. Key findings indicate that automation significantly enhances speed, accuracy, and labour productivity while reducing human error. The proposed model advocates for stage-wise implementation and collaborative training programs to bridge the digital skill gap. Financial evaluation of the reskilling program demonstrates a positive return on investment (ROI) of 10.03%, confirming the economic feasibility of human-centered automation. By bridging the digital skill gap through collaborative training, the model provides a scalable framework for retailers to maintain competitiveness in the dynamic Baltic and European logistics markets.