Justifying Robotic Automation

Before purchasing an industrial robot or robotic workcell it is good business sense to consider if and how robotic automation will be beneficial to your company. Determining the benefits and potential savings of a FANUC Arcmate 120ic or another articulated robot will help justify your investment in robotic automation. There are several different metrics that can be used to justify your investment. Some of the most common include:

• • ROI - Return on Investment (ROI) is the most common and main metric used by companies to justify investing in industrial robots. ROI is the percentage of your investment in a robot that you will gain back over a certain period of time. Most industrial robots will yield their ROI within two years or less. For more expensive robotic systems the ROI will likely be closer to the two year mark. While buying a used Yaskawa Motoman MA1440 will yield a faster ROI due to its lower cost. ROI is calculated by determining specific factors and entering those factors into an ROI equation. Most ROI calculations are based off the following factors:
  
  
  • o Robot Usage - This is the number of shifts per day a robot will operate. Will your FANUC LR Mate 200ic be used for one shift a day or all three shifts a day?
  
  
  • o Current Labor Costs - This is the total labor costs, including benefits, of the workers you will be replacing with your robot.
  
  
  • o Robot Cost - This will be the total purchase cost of your robot or robotic workcell.
  
  
  • o Robot Labor - This is an estimate of the costs associated with any labor that will be needed to run your robot system such as operators and technicians.
  
  
  These factors will help potential robotic users calculate the percentage of return they can expect with their robotic system and when they can expect their payback. Once the payback period has been reached profit potential expands with increased savings.


• • Labor Savings - Others prefer to justify investing in industrial robots through calculating the labor savings alone. While manual labor initially seems inexpensive compared to robotic automation, it costs companies more in the long run. Salaries, benefits, workers comp, are all continuous expenses with labor. Implementing robots eliminates these allowing companies to save in the long run as robots have minimal maintenance costs. The main cost of robots is paid upfront when purchased.


• • Better Product Quality - Higher product quality is another factor used to justify robotic automation. The accuracy of the ABB 4600 produces high quality products free of defects and errors. Consumer retention will improve and grow with higher product quality for expanded profit potential.


• • Cost Reduction - Determining potential cost savings is another metric that can be used to justify an investment in robotics. As mentioned earlier, robots reduce labor costs. They also reduce production costs by conserving materials, using fewer consumables, and reducing the number of utilities used. Costs are reduced, stabilized, and become more predictable helping companies expand their bottom lines.


• • Others - Other factors that are frequently used to justify robotic automation include scrap reduction, gains in market shares over competitors, increased workforce safety, faster changeover times for multi-product operations, and greater manufacturing flexibility.