What It Means to "Invest in Yourself "
Look within for high-value, high-return, competitively differentiating strategic investments, and consider the following improvements:
- Reduce utility usage.
- Increase capacity.
- Enable faster changeovers.
- Develop operating dashboards that enable plant workers to make on-the-spot decisions.
- Speed time to market for new products or packages.
- Improve agility so the plant can respond on the fly to changing economic conditions and customer demands.
- Rationalize the supplier base.
- Transform, integrate and optimize business and manufacturing processes.
- Perform system upgrades.
- Reduce total cost of ownership.
- Develop business models and explore what-if scenarios.
Consider All the Benefits
Investments in your plant deliver a range of benefits that impact your bottom line, including:
- Improved quality
- Less rework
- Increased yield
- Reduced raw material consumption
- Fewer unplanned interruptions
- Lower inventory
- Shorter time to market for new products
- Customer relationships
- Internal collaboration
- Competitiveness within the marketplace
- Better business overall
Of course, if you make your investment too hastily, you may be disappointed with the results. Carefully evaluate all of your technology and service options to avoid the pitfalls that may slow your capital deployment and consequently your ROI. Never invest in technology for the sake of technology. To make a truly strategic investment, an organization must address a holistic combination of people, processes and technologies.
Factors that impact your return on investment include:
- Inadvertently suboptimizing parts of your business. You must focus on the enterprise holistically, particularly at the outset. Don't get drawn into the trap of piecemeal solutions that don't integrate vertically or horizontally. To maximize ROI, the capital investment must be designed to be leveraged as much as is practical. An appropriate technology reuse strategy is a must.
- "Regret capital." A well-orchestrated and planned Capex program will prevent you from making investments that must be later undone or replaced.
- Technologies that require special skills or maintenance. If your investment requires hiring specialized personnel or paying exorbitant maintenance fees, these costs may outweigh the efficiency benefits. Look for technologies with a large installation base—preferably in the company's region—to ensure that available resources will know how to work with them.
- The financial strength and experience of the solutions provider. Select a solutions provider who is forward-thinking and disciplined. Make sure this provider will survive the poor economy and any following marketplace shifts. Ideally, you will partner with this provider for at least 10 years. This partner should also have years of experience doing similar work for other companies, and references should be available to you. Be careful to select a partner who is flexible, one who can grow and change with your ever-evolving business needs. Choose a partner who will not only help you develop your strategy, but will also manage implementation and perform much of the program. Many times the handoff between strategic technology planning and tactical implementation leaves a gap that can reduce the overall ROI. Furthermore, dealing with multiple providers creates additional expense and duplication of effort.
How to Invest in Yourself: A Step-by-Step Guide
Investing in yourself is easy to do and highly rewarding.
- Conduct an audit of your manufacturing operations to determine efficiency. This may require a flash diagnostic, which is a quick, broad look at the business. It is designed to be a cost-effective way to identify at a high level high-ROI opportunities, and enable a more in-depth study of the business operations.
- Get the cooperation of your entire organization. Your success requires buy-in from everyone involved. A good solutions partner will help you with organizational planning and work to prepare your team.
- Deploy the right solution. Investing in yourself starts with you and your basic business requirements. Only you can ultimately decide which approach is best.
- Choose a partner to help you select and implement the right investments, one that will be able to recommend the right level of technology, at the right cost and in the right time frame to meet your unique business needs.
- Reap the ongoing rewards. A proper investment is not a one-shot wonder; it should deliver an annuity-type return. Design your Capex program around solutions that deliver ongoing returns year after year.
You have the power to benefit directly and handsomely from an investment in the field of automation—even in today's poor economy. Now is the time to seize the moment to invest in your own business.
By taking simple steps to choose the right investments and the right partner to help you implement them, you will experience rewards that will position you as a stronger leader in tomorrow's marketplace.
Paul Galeski, PE, CAP, is CEO at Maverick Technologies LLC.