September 15, 2014
Volume I, Issue 5
Asking the Right Questions

Automated Guided Vehicle (AGV) vendors have tricks up their sleeves.  There are gimmicks to get customers' business, which are NOT in the customers' best interest.  Often AGV companies will propose a solution, obtain a purchase order, and THEN write a FORMAL proposal.  It is not appropriate.  The formal proposal is needed so the customer can evaluate if the solution truly meets their requirements, metrics, and needs. Too often AGV vendors do not fully disclose the costs for the full project and implementation.  The customer is hit with these hidden costs and is contractually responsible when the project starts. Perhaps, saddest of all is the common practice among many AGV vendors that the customer is KING during the buying process. After the purchase order is released and accepted by the vendor, the customer loses control of the process because AGV vendors are sure they know more that the customer. The power shifts and they know it.  Being aware of these practices, whether truly devious or commonplace, is essential.  The purchase order should be released only with full disclosure of the total cost and process. 

AGV ROI Required

Manufacturing companies and distribution centers (DCs) wrestle with the pros and cons of changing from a forklift modality to AGVs every day.  The first step generally comes from senior management and is initiated from a high level strategy.  Many times it is a safety initiative or a focus on efficiency gains, but the majority of the time it is driven by simple cost savings.  Increased labors costs often trigger the exercise of cost analysis.  The hardest part is understanding where AGVs can be used effectively within an existing operation while still getting a reasonable return on investment (ROI).  Most AGV systems are very expensive to fully implement; the resulting expense drives the need for a reasonable ROI when selecting an AGV system.  There is no trial period with AGVs or ability for companies to attempt a 'stick your toe in the water' solution.  There are exceptions but usually these are not capable of growing into a more fully featured solution handling more of the workload. 

Safety First Consideration in Automation 

The key factor in choosing AGV automation must always be the determination that the new automated system will operate safely in the DC or plant floor.   This top priority is integral in the AGV purchasing decision because the answer is almost always yes when AGVs are purchased from reputable vendors who follow ANSI B56.5. ANSI B56.5 defines safety requirements for powered, unmanned automatic guided industrial vehicles. The standard requires that the users are responsible for all factors affecting the operation and maintenance. This responsibility includes load stability and marking the travel path on the floor, including turning and maneuvering clearances. There are also requirements for manufacturers. Deviation from the travel path of more than 3 inches for an external reference (e.g. guide wire) or more than 6 inches for inertial guidance system shall require an emergency stop. A loss of speed control also requires an emergency stop. Vehicle warning indicators, audible and/or visual, shall operate when the vehicle is in motion. Emergency controls are required which would stop the vehicle if there is a loss of speed control, loss of guide path reference, or an object is detected in the direction of travel. Accessible emergency stop switches are required on the vehicle itself. 

Cost of Workers Compensation & Lost Time and Production

Understanding ALL the costs and making an informed decision on ROI is critical.  Costs can be evaluated in a myriad of ways.  Cost avoidance must also be considered.  Often, increases in mobile equipment accidents typically bring increases in the cost of Workers Compensation and Lost Time and production.  There are often increases in operational requirements, which are best handled with a fixed one-time cost versus adding increasing recurring labor costs. 

Increasing Profitability through Automation

Reducing the bottom-line is needed to increase profitability. There are many indicators that show two alarming statistics. The cost of labor and the associated loaded costs are increasing and the workforce for material handling jobs is rapidly shrinking. It is inevitable that for applications with moderate to long travel distances (involving structured movement of products) all movement will be performed by some form of automated vehicle without human intervention.  

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