Leveraging Low cost automation for Cost Effectiveness

Even though the challenges for both large and small organizations are broadly same like increase in labor cost, non-availability of people, pressure on pricing, increase in expectation on quality standards and service, the large organizations are adopting automation of processes to some extent to mitigate the challenges, the small organizations are struggling to get most out of the automation.

While some of the SME business heads are getting exposed to innovative automotive trends like robotics, machine learning, artificial intelligence, and industrial 4.0; either they become scared of those developments, or some people are feeling guilty of not being updated in the organization and trying to look for automation.

In my view, those innovative trends are catching up and need to be evaluated on the investment and adaptability to small size organizations. Even large size organizations are in the investigation and preliminary implementation stages in the organization except a few, who leveraged the benefits mostly on the robotics application. We need to learn and watch the trend, and as far as small size organization is concerned, a lot of opportunities are yet to be explored in low-cost automation itself.

In this article, i have tried out to give an overview of leveraging low-cost automation possibilities in small, emerging organizations for cost-effectiveness.

Level of Automation in SME organization

I can classify the automation implementation  in SME's in 2 phases viz

• Basic Automation Implementation
• Advanced Automation Implementation

Basic Automation can be defined as the creation and application of technology, which makes equipment, process or a system operate automatically with or partial involvement of people.

Advanced  Automation systems represent a level of capability and performance that surpass in many ways the abilities of humans to accomplish the activities. 

Most of the SME's are in the stage of leveraging basic automation only and i dwell more on the basic automation and its application areas, challenges, and solution approach in implementing organization-wide basic automation system.

Why business head is reluctant to automation so far?

There are many factors that contribute to low-level interest in automation and in my personal experience, the following are the reasons

1. Lack of shifting the focus on people dependence on automation:

Most of the SME's are still comfortable and dependant on manpower even though the realization started on the need for automation wherever the repetition of the process, need of skill requirement. The business heads are feeling more comfortable and convenient to hire and deploy people than looking for automation solutions and upgrading to unknown subjects.

2. Investment:

some organizations are reluctant to the investment and comfortable with the recurring expenses.

3. Lack of supporting system:

Even though the organization is ready to move from manual to automation and for the investment, they are not getting the required support in terms of reliable sources for automation, after service and support, internal people training, irregularity on the power source, inconsistency in the parts.

Now things are changing in all the above factors thanks to compelling pressure on the competitive pricing and the change in the ecosystem for automation. But we need to go a long way in bringing in awareness and creating an environment for thinking towards automation and successful implementation.

some organizations in SME have consistently focus and investing in automation, and hopefully, this will continue, and there will be a widespread focus on automation.

Opportunity areas for automation in small, emerging organizations

Conditions under which we should consider automation?

1. Massive material movement by manually or semi-automatic  which leads to accidents, fatigue or delay or low efficiency
2. Too much dependant of human intervention in ensuring process parameters which leads to quality problems like defects and defectives, rework
3. The repetitive and standard process where fatigue seems to exist

Primarily, when there is a need for

1. Accident prevention and ensuring safety
2. Improving manpower efficiency
3. Ensuring process and product quality

Typical application areas for automation

1. Movement of materials through material handling systems ( trolleys, hand pallets, stackers, conveyors, cranes, etc
2.  Reducing the dependence on manual intervention in a repetitive process like 100 % inspection or sampling inspection, where it is unavoidable to bring it under process quality through test rigs and scanners etc

3. Reducing the dependency on manual intervention where process consistency is important like molten metal pouring, chemical, powder mixing and in some cases automating loading and unloading the components in the machine

4.Avoidance of human intervention in mere data collections like attendance, machine utilization data, people efficiency details through software, data capturing devices 

Should we give strategic importance to automation initiatives or let it be operational initiatives?

In order to bring holistic achievement in the automation, the business head should give strategic importance to the automation initiatives. I mean, the business head should look at the business processes and manufacturing process in a holistic way for optimizing the resources through the automation route. 

Instead of trying automation in a localized, opportunities areas, if the business head looks at the overall opportunities in the system, identifying potential areas, forming core groups, evaluate the cost-benefit analysis, partnering with right solutions providers, involve all the stakeholders and implement as an important initiative, the benefit would be huge compared to the standalone, ad-hoc way of initiating some automation in the system.



How to identify opportunities for automation projects?

Automation opportunities can be identified at the overall business process level and within the process, in each elemental level, automation can be identified.

This can be done using process mapping techniques and micro elemental analysis.

Process Mapping Techniques:

for example, you consider one commodity or RM, and you can map the process from the moment it enters the security gate for GRN entry to final FG dispatch as shown in typical process mapping.

In each business process, the team should ask the following questions.

1. Is there a possibility for automation to improve the safety, efficiency, and accuracy of the process?

the team should look at each process only from the lens of AUTOMATION to get the benefit of quality, efficiency, and improving safety aspects. Most of the time, we are using a different lens like waste elimination, variation reduction, people interface etc, sometimes we overlook the possibilities of automation. of course all the waste elimination and reduction methodology may ultimately lead to automation, but when we go through the process only from the automation benefits like efficiency improvement, safety practices improvement, and quality improvements, there is a high probability to find automation projects.

After identifying the potential projects, the team can do the techno, commercial benefits evaluations to select the highest potential automation projects.

Micro Elemental Analysis for identifying the  Automation opportunities:

Another approach is using micro elemental analysis in which the engineer list down the operations into elements and each element is being questioned for the improvement through low-cost automation possibilities.

For example, in one of my client operations, they engage in press shop operations and when the process engineer lists down the elements like Picking the comp, loading, pressing, ejecting and unloading the component, they identified opportunities to eliminate ejecting and unloading by providing low-cost automation which takes cares of ejecting and unloading into the container automatically once the pressing operation is over.

The point is for the small organization, we need both approaches to identify the potential opportunities for automation.

Levels of Automation :

1. Fixtures / simple low cost mechanical/ Hydraulic / Pneumatic  setups
2. Material Handling facilities
3. Low-cost Special Purpose machines
4. Standalone High-cost automation
5. Integrating multiple machines and human interfaces

A typical checklist for successful automation projects

In most of the SME organizations, one common pattern i am seeing is that the organization is not getting the benefit of the automation even though the concept or the intention behind the automation projects was clearly thought-out and articulated.

The success will be materialized only when the team ensures some of the factors right from conceptualization to operationalizing the automation in line with customer's demand or flexibility.

The following factors need to be considered in the planning and execution stage to get the full benefit of the automation.

• Clarity on the objective of automation, whether the automation is meant for efficiency or safety or quality or the combination of all.
• Conceptual idea or drawing about the automation before discussing with the external service provider
• Desirable cycle time and matching with existing and future takt time requirements
• Selection of reliable source who is having integration experience in electro, mechanical and digital space
• Ergonomics consideration
• Availability of spares requirement
• Basic maintenance guidelines and adherence
• Meeting return on investment as per organizational guidelines

Like any other initiative, when the automation initiatives are conceptualized holistically and executed correctly by involving all the stakeholders, any automation will give more significant benefits to the organization.

Shifting the focus from Product Quality to Process Quality

In most of the small and emerging organization, we are observing that people spend enormous time, energy, effort in ensuring product quality through inspecting(in some cases 100 % inspection!) the final component both on functional and aesthetic aspects, segregation, rework and documentation.This kind of focus on a product only leads to “somehow” pushing the product to the customer with high manpower cost and long lead time. Moreover, this will set the belief in the organization that defects are unavoidable and the role of quality function to detect, correct and send it to the customer. Ownership also shifts from production to quality function on both delivery and quality. Eventually, the organization does not improve its problem-solving capabilities and culture of problem-solving at the source.

Instead, the organization can shift the focus more on the process quality than product quality. This shift can be demonstrated by ensuring the product quality at the source of production like pre-inspection of material before the process, providing process parameters through standard operating procedures,implementing mistake proofing devices either to prevent or detect the error at source of production, applying statistical process control, making the operator responsible for production and quality.

This focus on process will help the organization to reduce time, effort, energy in reactive product inspection processes, improve the problem-solving competency across the organization and reduce the lead time.

Shifting towards process quality from product quality, to start within the manufacturing process will be the first step towards total quality management in the organization.

Factors affecting people productivity in workplace

One of the concerned area in a workplace to improve the manpower productivity. Given the situation, automation or use of robotics is limited, how to improve the workplace ergonomics, thereby improving the manpower productivity?.

The following factors contribute to fatigue to the people. By optimizing either one or all of the factors will improve the productivity.

1.Person and his/ her posture
2.Type of work being done 
3.Tool being used by the person to do the work
4.Work Environment in which the work is being done

Why FLOW is important irrespective of production system?

Any manufacturing organization can be classified based on the production system. The production system is primarily based on TWO factors

1. Volume

2. Variety.

As shown in Pic, any organizations production system falls under any of the categories

1.Unique / Project Type production
2.Customized, Job Order production
3.Standardised, Batch Type production
4.Mass / Flow Production


You can fit your organization production system in any one of the above production systems.

However, irrespective of your production system, what matters for business profitability is SEAMLESS FLOW.

The ultimate objective of any organization is to striving towards continuous flow from the upstream process( RM Procurement from suppliers) to downstream process ( FG dispatch to customers).


How is the flow measured in manufacturing?

Flow is measured as Lead time. (Definition of lead time)

why flow is affected in any production system?

• Cycle time imbalance between work center
• Rejections / rework  at each stage
• Machine Breakdowns
• Changeovers or setting time
• Lack of  resources (material/man)
• waiting for decisions

Impact of poor flow on the business :

1. WIP between work centers
2. Long lead time
3. More Space
4. More Movements and Handling efforts
5. Rejections / Rework
6. Communication issues
7. Low productivity
8. Low flexibility to the customer

Solutions approach to improving flow in ANY production system:

Continuous-flow manufacturing (CFM) is an approach 

Continuous improvement efforts to integrate all elements of the production system.
The goal is a best possible balanced production line with little waste, the lowest possible cost, on-time and defect-free production.

Benefits of Continous flow improvement approach is as follows

• WIP inventory reduction
• Space utilization
• Set up time reduction
• Lead time reduction
• Reduce material handling distance
• Productivity improvement
• Quality improvement
• Better teamwork and communication
• High Flexibility 
• Better Visibility

To sum up, irrespective of your production system, you need to continuously improve the flow for sustainable business profitability !

Simple checklist for identifying ergonomic risk in workplace

As we discussed in Why Ergonomics is not given importance in SME organization? a simple checklist with little awareness to engineers, shop floor operating team will help the team to identify the ergonomic risk in the workplace. This awareness further triggers the improvement in workplace re-engineering by the operating team.

In fact, REBA (Rapid Entire Body Assessment) is a structured approach to identify the ergonomic risks in the workplace, the given below checklist is easy to understand and quick guide to identify the fatigue in the workplace by the operating team as we experienced in more than 10 + SME clients.

Ergonomic Assessment Checklist

1.Awkard Posture

2.Handling loads and moving

3.Repetitive physical activities

4.Environment and unfavorable layouts

Why is Ergonomics application not given much importance in SME organization?

Even though Ergonomics principles and simple risk assessment checklist can be used as a micro productivity tool in shopfloor to improve the productivity, safety aspects, most of the small, medium size organizations are not fully leveraging ergonomics principles and its application in process design.

Some of the misconceptions prevail among manufacturing professionals as we have gathered through our interactions

1.Ergonomics for product design not for process
2.Ergonomics can be applied in large organization
3.Ergonomics study can be done by scholars or external consultants 
4.Difficult to teach to shopfloor people 
5.Ergonomics is more related to Safety, health and environment  and nothing to do with people morale and productivity

In fact, with a simple checklist and little bit awareness on ergonomics principles, shopfloor operators, supervisors, managers can apply and identify the fatigue risk areas and implement simple solutions as we have witnessed in many SME manufacturing organizations.

How effective are you on managing assets?

         One of the factors for profitability is how you are managing the assets effectively. The assets can be your machines, buildings, facilities and of course your people. Let us discuss the depreciating assets like machines, equipment, and facilities. Effective utilization of asset helps you to serve your customer on time and best cost.In turn, it ensures the profitability. If you are not managing the assets well, you are incurring overhead cost of capital depreciation as well as on revenue expenses like maintenance, consumables, and power. It is the prime responsibility of business leaders to ensure he gets a high return on asset investment.

        Some of the pitfalls in managing the assets effectively

1. Only concern on utilization, not on efficiency
2. Not  much attention on basic maintenance activities
3. Poor management of spares and consumables
4. Idle time taken as granted as way of working
5. Lack of training on usage of assets

Some of the indicators of poor asset management

Ø  Frequent breakdown

Ø  A Long machine idle time for setting up of tools / fixtures

Ø  More accidents and unsafe practices in and around  facilities

Ø  Actual production  output not matching with standard output

Ø  More rejection on produced output

Ø  Not able to release the facility for preventive / regular maintenance

The solution is that first understand where you are  in the overall effective utilization of facilities, then  understand the causes for the losses and write counteractions. Be aware of your revenue generation capability  per hour from your facility in line with market condition. That will bring many insights!