Automation, Labor & Investment
If we boil it down, automation is simply about becoming more efficient. Businesses regularly search for ways to produce higher outputs with lower inputs because any savings go directly to the bottom line. Yet, a stigma remains surrounding automation. Many say these strategies destroy jobs. Some go as far to say they’re killing manufacturing.
Is automation truly killing jobs, or is it a window to new opportunities?
It’s up to you. Automating typically has a goal of reducing labor to produce a greater output; however, that does not mean there must be layoffs. In many cases automating one process opens opportunities to repurpose resources to another aspect of a business.
I recently attended a conference where I learned about dynamic-optimization software for cutting lines. I do not know how long dynamic cutting software has been on the market, but this type of solution will become the norm. This software uses algorithms to optimize cutting departments and achieve greater efficiency. One gentleman told me they’re now using 98 percent or more of their stock sheet glass. Efficiencies gained in their cutting department allowed them to focus resources in other areas. The people in their cutting department were not let go; they were moved to other aspects of production.
How about Ford Motor Company and the implementation of the assembly line? Henry Ford is one of the most well-known examples of automating, but there’s another thing Ford is celebrated for: how the company retained the best workers. Ford famously offered double the normal wage of that time, which allowed Ford to hand-pick the cream of the crop. The company required less labor to produce a higher output, which meant they then required people in other parts of the business, like sales. After all, there is not much sense in producing more if you cannot sell it.
Walmart is another company renowned for groundbreaking logistics and inventory systems, but is also widely known as one of the world’s largest employers. Walmart reinvented restocking capability, and the efficiencies they gain there contribute directly to Walmart’s low pricing, which of course adds value to their business. Companies like Amazon have taken these a step further, creating a billion-dollar business with no physical stores, as well as creating a standard to an entire industry of online vending. These companies provide an opportunity for millions of people around the world. I believe none of this would be possible without automation and its ability to reallocate capital to more critical areas.
There’s more competition than ever today, and if you’re not thinking ahead, you’ve probably already been left behind. Perhaps it is time to look at automation in a different light, for what it really is, which is an investment--an investment where you decide how to allocate the return. This could be less labor, or perhaps a greater volume of product, all while increasing the overall value of a business. As an investment, automation isn’t such a scary thing. In fact, it becomes integral to the survival of your business.
Pete deGorter is vice president of DeGorter Inc. Contact him at firstname.lastname@example.org.
The opinions expressed here are those of the individual author and do not necessarily reflect those of the National Glass Association, Glass Magazine editors, or other glassblog contributors.