I have to admit that many years of installing robots to reduce labor has blinded me into thinking of automation as robots to be installed. This matched the marketplace because the $200,000 robots morphed into $50,000 robots opening the door for new applications with each price drop. Shop floor manufacturing cost which was $.50 of every sales dollar in the 1950’s has steadily declined to $.20 of every sales dollar today. Since 80% of the current business costs are not on the manufacturing floor, it is not surprising that the best opportunities for reducing cost by automating are no longer on the shop floor.
It would be naive to claim that no automating activity has occurred off the shop floor. The PC, then smart phone revolutions, have brought the efficiency of software to our fingertips. We would not even consider typing and mailing a letter anymore. PC Office suite software is now available as “free” open source downloads. The more recent smartphone market is equally mature. Even as early as 2010, 90% of the smart phone apps sold less than 100,000 copies, which suggests that they failed to cover their development costs.
The 80% share of business cost off the shop floor shows that the current opportunities are still away from the shop floor. The developers agree and the latest excitement is centered around innovations that combine software and hardware. This is consistent with what I am seeing. Somewhere in the future your cars will have enough connectivity and spare computers or your cell phone will have enough battery capacity to handle extra tasks. In the short term dedicated devices such as the mileage trakker http://mileagetrakker.com that I market are good examples of the latest trend. Business people who travel are happy that a device plugged into the car handles most of the assembly of an IRS format mileage report so that they can receive their significant mileage deduction at income tax time