Run the Year-Two Test
Automation business cases are usually built for year one: buy the cell, save the labour, show the payback. The model is rarely wrong about year one. It is frequently silent about year two.
The Bot Scout year-two test asks what the cell costs after the launch is over: re-teaching when the part changes, wear items and consumables, controller backups and software maintenance, retraining after staff turnover, and the utilisation you actually achieved rather than the one you assumed.
A model that stops at first-year payback is not a model, it is a purchase justification. Adding a second year usually does not kill a good project; it kills a marginal one, which is the point.
| Model input | Common assumption | Honest version | Effect |
|---|---|---|---|
| Baseline | Estimated from memory | Measured cycle, touch time, scrap, changeover | Often smaller saving than assumed |
| Cell cost | Robot price | Arm plus tooling, integration, safety, training | Two to three times the arm |
| Utilisation | Near-continuous | Actual, including waiting and faults | Materially lower |
| Commissioning | Ignored | Production lost during install | Delays payback |
| Year two | Ignored | Re-teaching, wear, retraining | Extends payback |
| Labour | Headcount removed | Roles changed plus recovery duties | Partial saving |
Measure the Baseline Before the Vendor Arrives
Record current cycle time, human touch time, scrap and rework rate, changeover time, and the cost of an hour of stopped production. Without those five figures every proposal looks reasonable, because there is nothing to compare it against — the discipline in the robotics in manufacturing guide.
Utilisation is the input most often overstated. A cell that is available but waiting for parts, for an operator, or for a fault to clear does not produce, and waiting rather than breaking is what usually erodes the case.
Compare against a low-cost redesign as a genuine competing option, not a formality, as set out in the robotic automation guide.
- Measure the five baseline figures before any vendor visit.
- Cost the complete cell, not the arm.
- Model realistic utilisation including waiting time.
- Include commissioning downtime in payback.
- Add a second year of re-teaching, wear, and retraining.
What a Credible Case Looks Like
A credible case names the operation, the measured baseline, the complete cell cost, the expected utilisation with its basis, the exception rate, and the person accountable for recovery on each shift.
It also names what would make the project fail, which is the section missing from almost every proposal. A case that cannot describe its own failure mode has not been stress-tested.
For warehouse work the same model applies with different inputs, covered in the warehouse automation guide and the warehouse robot shortlist.
Bottom Line
An honest robotics ROI model measures the baseline, costs the whole cell, uses realistic utilisation, and budgets year two. Adding those does not kill good projects.
Extend your payback model by a second year before approving any automation quote.
FAQs
What is a realistic payback period for a robot cell?
It depends entirely on the measured baseline and the complete cell cost. Any figure quoted before those two are established is a marketing number rather than a projection.
Why do robotics ROI models overstate savings?
Usually three reasons: the baseline was estimated rather than measured, only the arm was costed, and utilisation was assumed to be near-continuous rather than modelled with waiting and faults.
What second-year costs should be included?
Re-teaching after part changes, wear items and consumables, controller backups and software maintenance, and retraining after staff turnover.
Should labour savings be counted as headcount removed?
Rarely in full. Roles usually change rather than disappear, and new duties such as fault recovery and exception handling belong in the model.