Economics aspects of Robotics system in Industrial Automations

Net annual cash flow = annual anticipated revenues

from robot installation including
direct labour and material cost
savings – annual operating
costs including labour, material
and maintenance costs of the
robot system
 Annual labour cost = operator rate x number
of operators x days per x hours per day

Annual saving = annual labour cost – annual

maintenance and operating cost

2004 2
ECONOMIC JUSTIFICATION OF ROBOTS
EXAMPLE:
• Compute the cycle time and production rate for a single machine robotic cell for an 8 hour
shift if the system availability is 90%. Also determine the percent utilization of machine
and robot.
• Machine processing time 30 s
• Robot picks up the part from the conveyor 3.0 s
• Robot moves the part to the machine 1.3 s
• Robot loads the part on to the machine 1.0 s
• Robot unloads the part from the machine 0.7 s
• Robot moves the part to the conveyor 1.5 s
• Robot puts the part on to the outgoing
• conveyor
0.5 s
• Robot moves from the output conveyor
• to the input conveyor 4.0 s

• Total 12 s

2004 3
ECONOMIC JUSTIFICATION OF ROBOTS
Solution:
• The total cycle time: 30 + 12 = 42 s

Production rate:
• (1/42) part/s 3600 s/hr 8 hr/shift 0.90 (uptime)
• = 617 parts/shift

Machine utilization:
• Machine cycle time/total cycle time = 30/42
• = 71.4%

Robot utilization:
• robot cycle time/total cycle time : 12/42
• = 28.6%

2004 4
 Advantages
• Greater flexibility, re-programmability
• Greater response time to inputs than humans
• Improved product quality
• Maximize capital intensive equipment in multiple work shifts
• Accident reduction
• Reduction of hazardous exposure for human workers
• Automation less susceptible to work stoppages

2004 5
 Disadvantages
•Replacement of human labor
• Greater unemployment
• Significant retraining costs for both unemployed and
users of new technology
• Advertised technology does not always disclose some of the hidden
disadvantages
• Hidden costs because of the associated technology that must be
purchased and integrated into a functioning cell. Typically, a
functioning cell will cost 3-10 times the cost of the robot.

2004 6