Boosting Productivity and Profits with Automation: Strategic ROI Benefits

Industrial automation technologies give manufacturers a competitive edge amid labor shortages and rising demands

Today’s manufacturers are faced with unprecedented challenges to stay competitive, productive, and profitable in an increasingly crowded and fast-changing marketplace. The pressure of these demands is only increasing in today’s challenging and evolving labor market. As baby boomers age out of the workforce, younger tech-savvy millennials and Gen Zers are taking over with less interest in the manual labor positions their predecessors once held. How can manufacturers continue to succeed in this environment?

Automation Proliferation Driving ROI

To continue growing, businesses are reevaluating their processes and learning the strategic advantages afforded to them by automated solutions, from machine vision and robotics to artificial intelligence and deep learning. As more manufacturers implement automated solutions, technologies such as machine vision and robotics are gaining traction. Interact Analysis reports the machine vision market will see a compound annual growth rate (CAGR) of 6.4% through 2028, while the industrial robotics market will expand 3.7% per year during the same period.

The potential of these markets speaks to the technologies’ ability to improve productivity and efficiency, worker safety, and product quality while reducing costs and augmenting the human workforce. These benefits are escalating utilization in many sectors, especially as the technologies continue to advance to enable even more process optimization, accuracy, and operational data collection for analysis and simulation.

“We have seen the growth of automation in many sectors. While some industries are behind, there is more of a push to drive automation into business to help with cost controls (inventory, quality, accuracy, and throughput) as well as the fundamentally changing workforce, which is impacting almost every industry in the United States,” explains Bryan Doherty, chief technology officer at Adaptec Solutions, a New York–based system integrator specializing in diverse material handling and automation solutions for the manufacturing, distribution, and warehousing industries.

“Automation allows companies to meet their production quotas, reduce workplace injuries and associated insurance costs, and put better controls in place around raw material inventories as well as finished goods inventories,” he adds.

Joey Koenig, business director at 7robotics, an Oregon-based robotic and automated systems integrator specializing in solutions for the wood products industry, notes that customers come to 7robotics for cost-effective solutions that will make them more competitive, while continuing to ensure employee safety and overall product quality.

Doherty echoes similar sentiments, noting that labor and cost controls are two significant drivers for the use of automation. “Many times, these two are significant drivers in terms of inability to maintain production levels and meet required sales demands,” he explains.

The wide range of cost-saving and productivity benefits and the growing number of technologies on the market means the return-on-investment (ROI) for automation projects can vary for each unique application. However, many manufacturers that implement automated solutions are seeing quick ROIs.

“ROI varies, but some of our customers report payback on investment within two years,” Koenig says.

Competitive Advantages of Automation

The strategic benefits of automation are countless. Here are some of the most important strategic advantages and cost savings associated with automation projects.

The Human Factor

The human workforce is a major factor in a company’s decision to implement automation. It is also a major contributor to the associated cost savings for manufacturing applications. Costs related to on-the-job injuries and absences are significantly reduced as safety increases. This also keeps workers happier, reducing turnover so manufacturers can retain their existing workforce longer and more easily attract new workers.

Koenig notes that worker safety is the number one reason 7robotics customers are looking to implement automated solutions. As a result, 7robotics offers a Robotic Pallet Building System that features three safety zones for safe and continuous operation. Two key features — eliminating the need for manual nail gun handling and automating pallet stacking — alleviate two of the more dangerous tasks when building pallets.

“Our robotic systems should increase overall safety by reducing or eliminating dirty, dangerous, dull, and demeaning jobs on the factory floor,” Koenig says.

Furthermore, automated solutions have stepped in to take over these dull, dirty, and dangerous jobs, allowing the available human workers to be more effective in more important, higher value tasks at the facility.

“Automation has changed how the workforce is applied within a facility,” Doherty explains. “As the workforce continues to age out and retire, the new generation of workers are less likely to want to do the jobs that previous generations have taken on. Automation helps reduce the amount of manual labor, but at the same time, this has also triggered a shift in how the workforce is applied.”

Doherty added, “Many customers are investing in training programs to create a new class of operator that is responsible for an entire line or process, such as being in control of a line setup, runtime adjustments, and reporting and production versus standing at a single station flipping or turning product.”

Boosting Productivity and Quality

Although labor is one of the most common drivers for automation, these systems provide other benefits as well. Because automation never gets tired, operations can continue for long periods of time at a consistent and efficient pace, increasing throughput and productivity. Also notable is the reduction in rejected products due to reduced or eliminated human error.

Moreover, automated systems bring data with them. Operational data can provide deeper insights into a facility’s processes, enabling analysis of process deviations or bottlenecks for continuous improvement. It can also help trace product throughout the production process, inform lead times, improve cost estimates, and determine timelines, thus providing more efficiency overall.

“Track and trace can benefit manufacturers by allowing them to trace defects in their production systems all the way back to raw material receipts. This helps with recalls, like in the food industry,” Doherty explains. “Other items, like real-time quality inspection within manufacturing, are key steps in the process that can help reduce scrap rates and lost production time.”

Because automated solutions treat each unit the exact same way, product quality improves, and waste and rework are reduced. Add to that automated quality control systems and manufacturers see even less waste and more consistency, resulting in happier customers that appreciate the increased quality and reliability. This can also contribute to an improved overall brand reputation.

Koenig notes that 7robotics has helped improve quality for its customers with sensors embedded on the robotic tooling. “By using sensors on the robotic tooling, our customers can automate some aspects of the quality control process,” he says.

Flexibility Driving Profitability

Robotics and other automated solutions are also becoming more flexible to help manufacturers speed up changeovers and produce more varieties of products with the same solution. With less flexible solutions, changing production from one product to another is often time consuming, reducing the overall output capacity of an automated solution.

“One advantage of robotics comes through the power of flexible manufacturing,” Koenig says. “For example, 7robotics offers a robotic cell to assemble pallets, skids, crates, and fencing. Customers can use this cell to build a wide variety of these products by simply changing the jig.”

Increased flexibility can enable manufacturers to improve profitability on smaller runs of product and offer more solutions for their customers, both of which Canopy Lumber Products, an Iowa-based manufacturer of customized shipping solutions, recently achieved.

Canopy Lumber Products implemented the Robotic Pallet Building System from 7robotics and reports that the system improved profitability on smaller production runs because of its consistent output and swift changeover times between products.

Patrick Kooima, general manager at Canopy Lumber Products, says the company has seen increased profits from smaller production runs because the new system enables changeovers in as few as five minutes, while the company’s previous system focused on large production runs due to much longer changeover times.

In addition to increasing production capacity and efficiency, Canopy Lumber Products implemented the Robotic Pallet Building System to enhance worker safety and improve quality. After only a few months of production, the company reported a drastic increase in employee safety and overall operational efficiency.

Expanding Applications

Automation technology’s continual evolution is enabling it to not only be more flexible but also more accommodating to applications with less consistency. For example, Koenig notes that in the wood products industry, building products haven’t always been conducive to automated processing.

“Certain products — like veneer or rough-sawn lumber — don’t lend themselves to robotic automation because their production volumes are too low or the product itself is not consistent enough for robotic tooling to handle consistently,” he says.

With specialized engineers handling these types of products, automation of applications once considered out of the realm of possibility are now feasible.

Innovation for Long-Term Success

With these cost-saving and productivity-boosting benefits combined, manufacturers investing in automation are not only experiencing quick returns and improved overall operations but also setting themselves up for long-term growth in the increasingly competitive marketplace. Staying ahead of competition means regular innovation, and as automation solutions become more advanced, they’re allowing for even greater gains by providing the edge manufacturers need.