Purchasing Automation
“Ultimately the importance of automation equipment is the reduction in human labor cost in manufacturing,” noted Bill Gibbs, president of Gibbs and Associates. “When we com- pete against China, Taiwan or any third-world nation, if labor is a large cost component, we have trouble competing with products made in the USA. But when the human cost can be reduced to a small piece of the overall product cost, then we have a level playing field, because the equipment costs the same to purchase, to run and to operate regardless of where you are in the world.”
Focusing on automating CNC-manufactured parts, Gibbs says he is encouraged when he sees higher levels of automa- tion occurring in the CNC machines themselves. “This can be through simple machines that are expanded through auto- matic loading and unloading, barfeeders,” he said. Tombstone systems for machining multiple parts, pre- loaded and pre-programmed on pallet changers, can run automatically 24/7 to machine parts in highly flexible, just-in-
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time modes, he added. “These are incredible technologies to reduce human labor, and at the peak of this category of CNC machines is the multitask machine—the single machine that replaces the functionality of many simple machines,” Gibbs said. “It has all the same advantages of high levels of automa- tion where we can put raw stock in one side, have the part go through several types of machining processes inside the same machine, spit out a finished part and not have multiple setups, multiple QA [quality assurance] issues, and not have to transfer parts between one machine and the next machine. “Some studies have shown that one of the biggest cost factors is just moving the part from one machine to the next to the next, each one with a new opportunity for human error, setup errors, quality errors and problems,” Gibbs added. “It’s not just the hourly rate of a human that you’re replacing with higher levels of automation, it’s also reducing the opportuni- ties for those humans to mess things up. I’m human myself and I have great empathy for humans, but the reality is every time you let a human make a decision or touch a part, there is an increased probability, small, of there being a mis- take made.”
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With highly automated systems, the initial high costs are partly due to increased cost of initial setup and programming, Gibbs said. But those costs are defrayed long-term with much higher part-production efficiencies that advanced automation offers manu- facturers. “You’ve got this high cost of initial setup and initial programming, as well as a high hourly rate for this more expensive equipment, and you have to amortize that against the number of parts that you process through. “I think that’s the most important word in all business—cost. What most people do is they confuse cost with price,” Gibbs said. “And the price of this equipment is generally only one of many cost factors. You have the cost of training your people to use it. You have the cost of installing this equipment, you have the inherent cost of amortizing the price against all the parts.”
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ManufacturingEngineeringMedia.com | December 2013
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