Beyond the Sticker Shock: The Real Reason Companies Hesitate to Adopt Robotics

Mike McLeod, Senior Editor, Machine Design: Is the primary obstacle still the upfront sticker shock of robotics, plus the costs associated with integration, repurposing and maintenance? Or is it more about uncertainty regarding the return on investment (ROI) for a robotic solution?

Ben Perlson, Segment Manager, ABB Robotics: I feel passionately about this—it’s a big question. I think cost is often blamed as the primary barrier, but realistically, that’s a bit of a cop-out and only tells part of the story. Having started on the consumer side of this industry and now working on the supply side, my personal opinion is that the biggest barrier to execution and the main hesitation in adopting large-scale robotics programs isn’t cost.

We've seen plenty of organizations deploy robots at scale, so we know the business case exists. The main factor slowing down adoption is a lack of confidence in leaning into the uncertainty around process change and change management. This is especially true within large organizations that may have been doing things the same way for a very long time.

MM: Right. I would imagine in logistics, for instance—and I don’t know the exact prices—that a forklift and a cobot are roughly in the same $20,000 to $50,000 range. Someone might not think twice about buying a forklift, but they might hesitate to spend the exact same amount on a cobot. Is that what you mean?

BP: Prices are all over the place. Given the variety of robots we offer, the price ranges from a few thousand dollars to a couple hundred thousand for some of the massive industrial models. But it really comes back to the softer variables—like training, maintenance and uptime—that people are truly unsure about. Ultimately, those are the factors that can erode a business case if they aren’t properly accounted for.

Capital equipment is often viewed as a “grudge purchase.” We see companies delaying the purchase of new, more efficient equipment for as long as possible—much like people sleeping on mattresses far past their useful life.

Aaron Prather, Director, ASTM International: Yeah, and I would add that we are seeing more and more newcomers to the space. In fact, one of the main takeaways from the recent MODEX event in Atlanta was just how many “newbies” were in attendance. People are actively inquiring and looking into automation, but as pointed out, they just don’t know what their next step should be.

Going back to pricing, you can implement robotics very cheaply, or you can buy the “Mercedes” version, so to speak. One of the major challenges going forward for the industry—and certainly for anyone listening to this webinar—is figuring out how to reach those newcomers. How do you get them to take that first step and move past their fears? There is a lot of anxiety around questions like: Am I making the right decision? Am I buying the right piece of equipment? Where will I be a year from now with this?

It’s difficult because everyone is coming from a different starting point with different budget requirements. Calculating ROI isn’t a straightforward equation anymore, like simply replacing a worker who makes $15 an hour. Automation might mean helping that worker do more, freeing them up for other tasks, or eliminating the need to hire a replacement. (And the total cost of replacing a $15-an-hour worker is much higher than just their hourly wage).

With all these different equations coming at them, newcomers often say, “I don’t know where to start." That’s where the industry needs to provide better guidance. We have to bring people into the journey and map out a pathway for them, recognizing that everyone's journey will be different.

MM: Right. Given that everyone has different applications and unique challenges, are there general steps or basic guidelines you would provide to a newcomer who asks, “Where do I start?” How can they make the right choices and figure out the best solution?

BP: I always start by saying, “Let’s find your lowest-hanging fruit.” Where is the quick win that will give you some confidence? In logistics, for example, a palletizing robot is a quick win. If you are building pallets all day long, you should automate that—especially if it’s the exact same box over and over again. You don’t even need to get into fancy, multi-SKU pallet building.

A repetitive, single-box palletizing application is a simple, quick win. Let’s get started there, build your confidence by showing you a clear victory, and go from there. That’s just one example, but I always look for that initial quick win. Ben, what are your thoughts?

BP: I agree completely. A quick win builds confidence, which naturally accelerates the rate of adoption later on.

Additionally, the most successful companies, in my opinion, are the ones that don’t pretend to know everything. Reach out to integrators and partners who possess an exploratory, consulting mindset, rather than vendors who just try to shoehorn their specific solution or product into your operation. While people often say all warehouses are the same, there is a tremendous amount of nuance in each customer’s operation, product and workflow.

The best way to start is by asking a lot of questions to understand if the process you are trying to automate is stable and optimized for automation—or if you are just putting a band-aid on a much larger issue.