Challenges & Value of Integration two Standalone Automation Systems
System Design from Day One is very important and this article shares about the challenges and an improvised solution, which is NOT perfect, but a cost effective approach without scrapping both entire systems. There was an hidden investment cost already to train the operational staff to get use both systems. Then there was an operational downtime , if a new integrated system was introduced to replace the two expensive legacy systems.
Back in the 1990s, there was an International Inventory Management System (IMS) linked to other multiple sites, and operated manually. Then the company added an locally designed and built Automatic Storage and Retrieval System (ASRS).
As the IMS database is confidential and not accessible due to their European Headquarter Control. The ASRS was design and built locally due to local customization and support requirements.
The local organization wanted to integrate both systems for Automation.
Back in the 90s, the computers available were AT PCs, VGA monitors, EISA frame grabber cards and RS232 interfaces.
We had to assemble a team of 2 engineers to figure out with a workable an cost effective solution for the local company without replacing the old working systems.
We used :-
Software
Recommended by LinkedIn
Both legacy systems cost ~ $ 5 M and to replace them into an integrated system cost $ 20 M.
Project Cost
Total Cost of project $ 40,000. As I was just starting up my company back with no track record yet, I was already glad to secure a P.O. of $ 60,000.
On hindsight, I should have quoted a P.O. of $ at least $ 500,000.
Being an Engineer and did not start SysEng as a Business person, I did not understand the value of that project as we were too focus on the Engineering solution only.
For Engineers, we need consider of your impact to provide solution rather than cost ++ quotations based on components and manhours only. We should look at VALUE to the client which might cost them $ 10M.
What do you think ?
KOH Niak Wu, Ph.D. Tan Kwang Hui Sebastian Yee Chun Keong Choo KY Chan William Lee Paul Mah Farzam Farbiz Choon Lim Ho Colin Koh (許国仁) Alex TAN, MBA 陈钦兴, 硕士
intelligently orchestrating operations
4moIt is a delicate balance between closing the deal quickly or going through a slow, painful budgetary process. We have to choose our battles strategically and more so in unknown terrains.
Many still value solutions based on time instead of knowledge. Is there a model that has time cost, and knowledge cost factors perhaps in terms of experience, education?
You have certainly hit the bull eye with the key word VALUE for the client. Unfortunately most customers do not see beyond the value. Example is repair of test equipment; a skilled technician can repair it at component level by replacing a $1 component vs another replacing board level which cost many times more.
Roboticist AI, Machine Intelligence enabling New Product Development into Manufacturing & Supply-Chain Operations
4moiPhone cost US$1 to manufacture, but sells at US$4. Singaporeans don't understand gross margin within the context of Financials. Mostly due to our Government tendering system, the lowest bid wins. This practice is ingrained into the way of business, so every time something breakthrough of Innovation, Civil Service Officers will ask how much and 1st comment, too expensive. There is no Economic of Scale understanding, no Cost reduction strategy, always win at 1st bid.