In manufacturing, you always need to keep your eye on the bottom line. When word comes along about new technology that will impact your industry, the first thing you need to ask is how relevant is this technology to your manufacturing business, and how soon do you need to adopt it? Trying to adapt to 2019 trends and then pivoting when 2020 trends lead in another direction can be costly and waste time and energy.
How do you know when it is essential to adopt new technology, or if you need to adopt it at all? Here are a few tips to help.
Employ the 10X Rule
One rule some business owners or managers look at when considering whether or not to adopt new technology is the 10X rule. If you anticipate a return of ten times or greater on your investment in the new technology, you should go ahead. If not, you can wait.
However, it’s important to realize that there are a lot of factors that go into a calculation of whether you are getting a tenfold return. You could see gains in a reduction of your costs, an increase in productivity or increased speed in getting a product to market. Your new technology could also result in an improved product that more people want to buy. Saving time and improving worker morale are other potential gains when it comes to new technology.
You will also want to include the potential costs of adopting new technology, such as the expense of new equipment or the time lost when training employees on proper use of the new technology.
Manage Risk With New Manufacturing Technology
The question of if and when to adopt new technology for your manufacturing business comes down to managing risk. If you fail to adopt new technology fast enough, you run the risk of falling far behind competitors who start implementing the technology sooner. On the other hand, if you invest in a new technology prematurely, this could also cause you to lag behind competitors who wait until that technology is proven or perfected. What’s the best way to manage this risk?
The first step is to ask if the new technology solves or helps mitigate a problem you have. If you are struggling to meet shipping deadlines, having issues communicating with your staff or are having trouble collecting the data you need to meet the demands of the market, for example, and the new technologies address those issues, you should be more inclined to pursue them.
Once you decide you are interested in new technology, it’s a good idea to put together a multidisciplinary research team to analyze the technology. Differing perspectives can give you the most realistic assessment of whether or not you need this technology.
Finally, do a hard and honest assessment of the potential costs and benefits of the new technology. This should give you a sense of whether it is worth the risk to proceed and give it a try.
For more information or for affordable, reliable manufacturing technology repair, get in touch with us at Global Electronic Services.