Automation Can Be Useful, But Not Everyone Will Benefit

Automation can be tremendously useful, bringing about gains in speed, accuracy, efficiency and reliability. Nevertheless, it would be wrong to assume that it can solve every problem you might encounter in handling goods. There are still a lot of areas where humans perform better. Here is a look at where automation is and is not useful.

Goods-to-person, or GTP, systems like vertical lifts, automated material-carrying vehicles and carousels can be incredibly useful and provide a good return on investment in applications where there is a high volume of activity. However, it is vital to keep in mind that human labor can be more flexible in environments where business conditions often change. A carousel pod, for example, might not be able to handle a late-afternoon rush of orders as well as a group of several workers.

Ensure a Good Return on Investment Before Taking the Plunge

An article on Industry Week provides some food for thought on the issue of return on investment of automation. The site mentions a mid-sized industrial distributor that shelled out $3 million on carousels that were linked to an active conveyor. They found that the reliability and performance fell far short of expectations, causing them to abandon the system at a huge loss. Even if it had worked well, it still would have been a poor investment. That’s because they had 20 warehouse workers whose yearly wages and benefits totaled $600,000 before the automation. If the automation had enabled them to cut their workforce in half, they would still have only saved $300,000 per year, which means their return on investment after five years would have been minus 19 percent!

This is why it is important to do some due diligence to determine whether automation makes sense economically before blindly adopting the latest clever offering. Automation solutions can be a very costly purchase, so it is important to get advice and take everything with a grain of salt before making a commitment.

This blog post was based off of an article from Industry Week. View the original here.

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