Try some technology – it helps

In Technology on June 10, 2010 by Tim Aikens

I have just spent a couple of days helping a friend put up a (very) large garden shed.  As you could imagine, this involved a lot of wood and a lot of screws.  To help us along we went out and bought an electric screw driver, very much the industrial model with a lot of torque and a good battery.  It cost £100.  The impact was really quite amazing. Instead of the old laborious wrist turning, this machine wound in the screws in seconds.  A great piece of productivity gain that was really noticeable.  But does it pay?

I thought I would look at the economics.
Price of kit £100.
Say a workman is paid £120 per day or £15/hr for an eight hour day.  That works out at 26 pence per  minute of his time.
Now assume a three inch screw takes two minutes by hand.  It costs  52 pence to put the screw in place.
The machine takes just 20 seconds and therefore costs 8.7 pence.
The saving is 43.3 pence per screw!

So to pay back the cost of the screw driver you need to install £100/43.3p = 231 screws.
Lets say the workman puts in 30 screws per day – because he does a lot of other things too.  Then the machine will pay for itself in 231/30 or 77 days.  After that the organisation is benefiting to the tune of about £14 per day, which in a full year of 250 working days is £3,360 (which does assume full occupation).

The example is real, the price is real, some of the numbers may need a little adjustment. However, the principle is clear, technology will usually pay for itself many times over.  Now for many this is really all to obvious – look at cars, largely made by robots, or shipbuilding where large panels are welded automatically.  But in too many areas a lot of folk are not applying technology as they might and are losing the productivity benefits that go with it.   This happens even in the professional world. I remember one boss who wanted his team (including me) to analyse some computer print out by hand in order to get a ‘feel’ for the structure.  After two days we revolted.  My colleague wrote a piece of software that did the jobs in minutes that would have taken us weeks by hand!

Technology is not a productivity panacea, but we need to be prepared to look for and apply technology whenever it looks like there could be a real payback!! Do you have technology in all the right places?


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: