Businesses often decide between using automation and labor in production. An aut
ID: 1181969 • Letter: B
Question
Businesses often decide between using automation and labor in production. An automotive environment may have high fixed costs and low variable costs, and an industry that utilizes manual labor for production will have low fixed costs and high variable costs. In general, how would you describe the balance between the costs of automation, or fixed costs, and the costs of labor, or variable costs? How has technology changed the balance between automation and labor? What type of industry benefits the most from technological innovation? Please provide specific examples.Explanation / Answer
Although many people know that Sonora, Mexico is a beautiful vacation spot, it is also a large furniture manufacturing location in North America. Guillermo Navallez made furniture for years near his Sonoran home. The area had a good supply of timber.
Manufacturers typically turn to automation to lower costs, increase yields, decrease cycle times, improve product quality and uniformity, and gain competitiveness. Because short product life cycles are the rule rather than the exception today, most companies want high-speed assembly machines, conveyors, feeders, robots, vision systems and other types of automation that is flexible. Reusable and reconfigurable automation benefits manufacturers because the equipment can be used for more than one product line or more than one assembly process.
Any type of automation project must be competitive in price, provide a positive return on investment and be delivered on time. However, manufacturers are demanding more value from automation equipment today, because they are under intense pressure to compete and control production costs.
As product lifecycles get shorter and shorter, it makes it less practical for some companies to build proprietary assembly lines. Outsourcing production to a third-party contract manufacturer allows original equipment manufacturers (OEMs) to dramatically cut their fixed costs, while freeing up cash to invest in strategic initiatives, such as new product development or marketing. It also lets a company reduce labor costs by shrinking its direct work force.
Unfortunately, there's no one-size-fits-all "best answer" to the automation vs. outsourcing question. Indeed, the ultimate decision depends on many different factors, including intangibles such as consumer demand, management style, corporate culture and shareholder pressure.
B)Technology has changed as automation has wider scope of technology rather than manual
C)Industrial benefits:
1.Work in less time
2.Cheap production
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.