Research needs in managing factory automation
Authors: Meredith Jack , Hyer Nancy L. , Gerwin Donald , Rosenthal Stephen R. , Wemmerlöv Urban 
Published: October 2002

The subject of factory automation is a critical one for all business functions, with the potential of creating an entire upheaval in the fields of accounting, finance, marketing, general management, and most significantly, operations management. Totally new ways of managing a business are likely, but it is not yet clear what these ways may be. In spite of the tremendous implications of these new technologies, little research is being conducted in this area. A panel session exploring this topic was thus offered at the 1984 Toronto meeting of the American Institute for Decision Sciences. This article presents the results of that session. The intent of the article is to foster research interest in this area and identify the extensive opportunities available. The article reviews the extant literature concerning the management of factory automation and identifies the gaps in our knowledge where research is needed.

Factory automation as defined here is intended to include the areas of both hard automation (CAD/CAM, robotics, FMS, etc.) and soft automation (such as MRP II, group technology, MAP, data networking). Research issues are divided into three major topic areas for ease of discussion: strategic issues, justification issues, and implementation issues. The strategic area encompasses the subjects of corporate strategy and its tie with manufacturing strategy, firm characteristics of leading‐edge users of automation, the effect of learning and experience with automation, the concept of “synergy” among automation technologies, technology transfer, and implementation strategy.

The justification issues are divided into benefit, cost, and risk aspects. The present inadequacy of economic justification techniques for automation systems and the pros and cons of alternative approaches are explored. The consideration of differing types of automation and their possible need for differing justification techniques is also discussed. For both benefits and costs, the quantification problem is a major issue, particularly with benefits believed to improve the effectiveness of operations, rather than their efficiency (a major advantage of the automation technologies, it is often claimed). Another major issue here is the pre‐ and postautomation comparison, requiring accurate and thorough manufacturing audit techniques. The risks in automation can be tremendous. Whether this can be reduced through incremental automation, or other approaches, is a very important question. The nature of the risks‐technological, financial, sociological—is also an important subject for research, as well as methods to deal with each type.

Topics in the implementation area include procedural aspects, human aspects, interface/infrastructure aspects, and measurement and reward aspects. In general, the nature of the automation implementation process, and its solution, is a critical research area that is confounded with multiple factors. There is a need for research to determine if such a thing as a “best” implementation path exists for specific technologies and firms. How does a firm know if it is “ready” for automation, and which automation technology to start with?

The effect of automation on workers and management is an important research question. And in addition, what are the effects of these employees on the implementation process? And it will be necessary to know how jobs change under automation, for both line and staff. Research is also needed to determine how automation will affect the way the firm does business, how interdepartmental coordination will be affected, and whether there will even be departments. If automation is implemented piecemeal, can the pieces later be tied together? What will be the problems? Managers need to know if new measurement and reward systems will be needed for workers, or perhaps even more important, for the managers. Will incentives need to be increased, or changed in some other fashion, for managers to be willing to take the risks involved in automation?

Last, some advice is given to the potential researcher in this area. Approaching this subject in a way that yields meaningful research, helpful to real managers currently struggling with these problems, is important since real firms are our primary research laboratories in this field. For example, case studies, interviews, surveys, and conceptual development are important early tools in this area compared to the traditional model building and analysis techniques that have historically characterized operations management.