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Adoption of AI-based order picking in warehouse: benefits, challenges, and critical success factors

Author

Listed:
  • Fakhreddin Fakhrai Rad

    (Södertörn University)

  • Pejvak Oghazi

    (Södertörn University
    University of Vaasa
    University of Economics and Human Sciences)

  • İzmir Onur

    (Gümüşhane University)

  • Arash Kordestani

    (Södertörn University
    University of Economics and Human Sciences)

Abstract

This research assesses the adoption of artificial intelligence (AI)-based batch order picking in a warehouse, focusing on benefits, challenges, and critical success factors. Using customer order data and simulation, the study employs a quantitative approach, combining mathematical and statistical estimations with qualitative examinations centered on interviews with the warehouse staff, its Enterprise Resource Planning (ERP) developer, and the AI developer. The findings of this mixed-method study reveal that the AI-based order-picking system (AI-based system) has improved order-picking efficiency by reducing travel distance and time. Nevertheless, challenges hinder maximum utilization of the system. In addition, the research highlights critical success factors and other benefits of adopting the system tailored to warehouse management. Understanding the lessons learned in this research is essential for businesses seeking to adopt AI to enhance their efficiency.

Suggested Citation

  • Fakhreddin Fakhrai Rad & Pejvak Oghazi & İzmir Onur & Arash Kordestani, 2025. "Adoption of AI-based order picking in warehouse: benefits, challenges, and critical success factors," Review of Managerial Science, Springer, vol. 19(11), pages 3495-3540, November.
    • Handle: RePEc:spr:rvmgts:v:19:y:2025:i:11:d:10.1007_s11846-025-00858-1
    DOI: 10.1007/s11846-025-00858-1
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    JEL classification:

    • M11 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Production Management
    • M15 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - IT Management
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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