Robots and other forms of automation are gaining converts in warehouses and DCs because of their ability to cut operating costs and deliver consistent performance. Too many companies, though, fall into the costly trap of "automating for automation's sake," warns David Riffel, solutions consulting director at TAKE Supply Chain, a developer of supply chain collaboration and data collection software solutions.
In a recent interview, Riffel outlined seven strategies for getting a solid return on investment (ROI) while avoiding "automation overkill":
- Don't use automation to fix a process problem. Before you automate, make sure all processes are as efficient as they can be. Otherwise, automation will only make a bad process happen faster.
- Match complexity with capability. A small operation with a limited number of products and customers may not be able to properly apply a complex application and is unlikely to get an adequate ROI.
- Strive to get "most of the benefits without all of the automation." A phased approach to implementation lets you assess the improvements achieved in each step before you move on to the next one. The aim is to avoid automating something that won't benefit enough from it to justify the cost.
- Automate for agility. Automating processes that are prone to human error or require waiting for human responses shortens overall cycle times. Those shorter leadtimes let you be more agile and responsive to unexpected change.
- Don't force mature automation on developing regions. Automation has little chance of success where there are limitations like spotty access to electricity or inadequate technical support. In a culture that highly values face-to-face communication, moreover, automation can undermine trust in business relationships.
- Don't over-automate just because you can. It's easy to get caught up in automation's "cool factor" and end up with expensive features you don't really need or understand. The result will be an unacceptable ROI.
- Think strategically about automation. Instead of looking at automation just as a way to reduce costs and boost efficiency, think about how it could give your business a competitive advantage and support your company's business strategy. Automation should support human decision making, not entirely replace it, Riffel said.
Gartner, Inc.
