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Tag Archives | ROI

How to Determine Robot ROI

As robotic performance continues to accelerate, now is the perfect time for mid-sized companies that have been waiting for a decline in robotic prices to deploy these automated solutions. Here’s how to determine the value of this decision.

robotic-pick-place2While reading a report by The Boston Consulting Group, I learned that global sales of industrial robots rose by 23 percent last year, with deliveries expected to double to 400,000 a year by 2018. The report also predicted that industrial robot pricing will continue to decline over the next decade by more than 20 percent. If this holds true, it will make more applications viable for robots, thereby decreasing the investment required for integration—which is the primary roadblock keeping many manufacturers from moving forward with robots. In fact, the one question I hear most often from clients is: “What’s the ROI on my investment in robotic automation?” Continue Reading →

Automation Roadmap: Assessing Your Network Architecture

To facilitate efficient and cost-effective process improvement, your network architecture needs to be thoughtfully planned out, not just patched together.

By now, you know you want to create an automation roadmap that aligns with corporate goals, which typically center on production, efficiency or quality gains. In my last couple of blogs (accessible here and here), I provided a structured approach to developing your automation roadmap, which generates a nice list of projects, in order of priority, accompanied by budget and timeline considerations. But before you make your way to the corporate offices to garner budget approval, there are a couple of additional considerations that will add the finishing touches to your automation roadmap: network architecture and safety. In this post I’ll address network architecture; next month I will address safety. Continue Reading →

An ROI Approach to Budgeting

results-productionDetailed evaluation of anticipated return on investment for each prioritized project helps gain project approval and maximize project results.

In my last two blogs, I discussed the importance of an automation roadmap and how to get started developing one. Hopefully, you’ve created a prioritized list of potential projects and are now ready to tackle how to budget for them.

Many people seem to think that in order to establish a budget, they need to develop a spec, reach out to vendors and conduct a formal Request for Quotation (RFQ) process. All of this takes a lot of time and energy, so I hope it is welcome news that I do not recommend this approach. Rather, look at it from a Return on Investment (ROI) perspective.

What payback period does your company expect on each investment? A two-year ROI seems to be an undocumented industry standard, but each company will have its own. Meeting or beating that payback timeline is typically important for project approval. Continue Reading →