Automate the Right Process
By Mike Nash
We live and work in a time when automation has taken over the majority of our day. From PC’s to voice-activated phones to mechanical toothbrushes, we are now performing many previously mundane tasks in a manner that takes minimal thought and even less time. In the business world, automation has been and continues to be the rule with assembly, packaging, and manufacturing often being completely automated.
On the surface, all of these things seem like positive, productive steps toward making our business and personal lives easier and more efficient. However, automation is not always the best solution. Automation has two primary benefits – the first is to optimize a process at a good return-on-investment (ROI), and the second is to improve the quality and consistency of the product. In most cases, businesses must have an ROI to justify the expense of automation. In addition to ROI requirements, there must be an analysis of the automation’s impact on the surrounding processes.
Many businesses make a significant capital expenditure only to realize (too late) that the purchased automation did not actually optimize the overall process. We have seen many examples of this in our businesses. Maybe it was the network server that was obsolete in less than a year, or the new pasta machine that didn’t create spaghetti to specification. Over the years, Argent has seen warehouse picking automation that sat idle for years, and laboratory automation that actually expanded the process instead of streamlining it.
1. Analyze First - Spend less
The solution to avoid such costly mistakes is to simply do the research up front. Most companies do a cost justification – the corporate controllers demand it. but the question is – are we approaching this analysis in the right way? The very best way to analyze a process is through Lean and Six Sigma techniques and every manual process must be viewed though this analytical lens. Process analysis requires flow charting, cursory time studies, statistical analysis, and other quantification of the baseline variables. This benchmark is essential as a first step.
2. Optimize Underlying Process
The next step is critical and often overlooked: the underlying process must be optimized before deciding on automation. Automating without optimizing the underlying process may help to fix a bad process, but it is only a band-aid. The underlying processes must first be optimized in order to have a solid foundation on which to build.
Many times, an automated system is ‘dropped’ into a facility without considering its impact on the overall process. As a result, the automation creates a situation whereby the work product must travel excessively around the building. This wastes valuable time and money.
3. Evaluate Capital Purchases Objectively
Finally, capital purchase options must be evaluated objectively and compared to the benchmark. Many times, companies get caught up in marketing hype and decide on an automation or technology prior to determining if there is a true financial benefit. A small consulting investment up front can have an enormous impact on the success of the capital decision. An analysis that costs 1% of the capital purchase price may save millions of dollars in waste on the back end, not to mention the headaches involved.
Summary
Prior to deciding on automation, it is important to optimize the underlying process and establish a benchmark for improvement. This involves an impact review of the layout, technology, manpower, and processes affected by the automation. It’s important not just to automate but to automate the right process.