December 20, 2014 / agility, best practices, blade selection, continuous improvement, Cost Management, human capital, LIT, productivity, quality, resource allocation, strategic planning
It’s budget time, which means that managers are allocating resources and making investment decisions about production equipment and technology. In today’s unstable market, some shops may still be hesitant to make any huge capital expenditures; however, positive outlooks for 2015, increasing demand for faster delivery, and a shortage of skilled workers are pushing many executives to make at least some investments this year. According to the 2015 Capital Spending Survey by Gardner Research, U.S. metalworking facilities will spend $8.8 billion on new metal-cutting equipment in 2015, an increase of almost 37 percent compared to Gardner’s latest estimate for 2014.
One of the first investments most companies will consider is automation. In fact, a recent study by Grand View Research Inc. states that climbing labor costs, a booming automotive industry, and market demands for rapid and efficient manufacturing processes are increasing the need for automation in industrial manufacturing. As a result, the research firm expects the global industrial robotics market to exceed $40 billion by 2020.
For machine shops, there is a wide variety of automated saw options, including equipment with programmable workstations for repeat jobs, as well as models equipped with robotic attachments, complete with a camera and modem system that will notify the plant manager immediately if there’s a malfunction. Automatic feeder systems can take material out of the storing mechanism, place it on the saw, and stack it on a skid after it is cut. If speed is critical to a job, managers have a number of options. They can consider semi-automatic or automatic saws, choose between high-production precision circular saws or band saws, and evaluate a number of blade choices optimized for faster cutting.
As this white paper explains, the challenge is deciding where automation makes sense within your operation and how to effectively balance technology and process automation with the allocation of shop floor personnel. In most cases, the decision process is not a simple one and requires strategy and careful consideration. For example, while automation is often used to reduce labor costs, automated equipment usually still requires an employee to load material into the system and to remove finished material.
The reality is that the decision to automate is not always clear-cut and depends largely on your specific application and your operational goals. Sometimes, automation is the best way to maximize productivity. Other times, it may be more beneficial to spend your dollars elsewhere. To give managers both perspectives, below are examples of two companies that strategically approached the decision of whether or not to automate:
- Choosing Not to Automate. Although Pointe Precision has always been known for its low-volume, high-complexity aerospace and medical parts, the machine shop, featured here in Modern Machine Shop, decided to diversify its operations by becoming a high-volume production supplier of critical parts to a large manufacturer of recreational products. According to the article, this required the machine shop to invest in several new pieces of equipment, which shop owner Joe Kinsella arranged into cells. However, Kinsella decided very early on not to automate the new line and, instead, chose to invest in developing a specially trained workforce. Why? Kinsella told Modern Machine Shop that “automation would have added to the cost and complexity of the system,” and “it would have been difficult to grow the automation as more machines were added, especially since the final configuration of the cells hinged on an expansion to the existing shop building.” In addition, a customized, dedicated system of automation would have restricted the flexibility of the line, making it difficult to repurpose it down the road. “We preferred the strategy of developing a workforce of specially trained hires who were not likely to have prior factory or production experience,” Kinsella says in the Modern Machine Shop report. “We could grow this staff as we added new machines, all the while preserving the versatility of the machines by avoiding customized, dedicated systems.”
- Choosing to Automate. For metal service center Infra-Metals, automation is a top priority in every aspect of the operation. According to a case study published by Modern Metals (MM), the service center aims to automate wherever possible to improve efficiency and eliminate paperwork. “When we implement automation, we have fewer mistakes, fewer man-hours per ton, and a saw operator is able to do more during the time he’s here,” Mark Johnson, processing/facility manager for Infra-Metals New England Division, tells MM. The service center recently invested in four automated band saws, which feed, cut-to-length, and discharge automatically. The company can download data from its mainframe straight to the saws, so operators no longer need to input information. Measurement information and cutting instructions transits from the order to the manual batcher and into the automated sawing system’s computer system. According to Johnson, automated processing has not only helped Infra-Metals improve cutting output by 30 to 40 percent, but has also reduced mistakes, provided a better cut, and improved on-time delivery, MM reports.
In the end, managers need to be sure they approach automation with a reasonable set of goals and expectations. Like any investment assessment, the deciding factor should really boil down to the customer. Will customers benefit from adding a robotic arm to your band or circular saw? Will an automated saw increase turn-around time? Is your goal improved productivity or just a reduced head count? These are the questions managers need to be asking as they weigh cost expenditures against the benefits—or detriments—of those dollar-allocating decisions.