Problems › Digital Transformation Consulting › Manufacturing
Automation spending at a manufacturer is an operating-model problem that arrives disguised as a machine or system purchase, which is why the equipment is installed and contribution per machine hour stays flat. For manufacturers, this shows up in a particular place. The numbers that carry the answer are contribution per machine hour and capacity utilisation, and the complication specific to this industry is that the $45M automation case depends on the very customer that causes the margin problem. The general version of this problem and the one you are actually in have different first moves.
Automation spending at a manufacturer is an operating-model problem that arrives disguised as a machine or system purchase, which is why the equipment is installed and contribution per machine hour stays flat. For manufacturers, this shows up in a particular place. The numbers that carry the answer are contribution per machine hour and capacity utilisation, and the complication specific to this industry is that the $45M automation case depends on the very customer that causes the margin problem. The general version of this problem and the one you are actually in have different first moves.
The programmes stall because the sequence is inverted. The line or cell already runs with its existing changeovers, scrap points and workarounds; when the new system or press is installed it simply locks those steps in place, so takt time and scrap rate remain unchanged while the capital sits on the floor.
The business case is assembled in purchase units while the return must appear in operating units. Equipment cost, integration and training are fixed and appear in year one; any lift in contribution per machine hour or capacity utilisation shows up later and only if the underlying flow was altered first.
The real choice is whether the investment alters what the plant can sell or only what it costs to run. A line that now supports smaller lots and shorter changeovers can accept a wider mix of customers and reduce concentration; a line that only cuts scrap on the existing mix improves margin but leaves revenue profile untouched.
Digital & Technology Strategy (catalog id t8) starts with the actual cost of the current flow in machine hours and scrap, separates the commercial from the operational case, and only then considers vendor selection. When the payback is clear without process change, an implementation partner is the correct next step.
These three together are the signature. One on its own usually points somewhere else.
✓ Contribution per machine hour and capacity utilisation are reported monthly yet show no movement after the new cell is commissioned.
✓ The business case lists licence or equipment savings while the plant director continues to track scrap rate and changeover time as the binding constraints.
✓ One customer still accounts for the majority of scheduled hours even after the automation project reaches steady state.
The move that usually makes it worse. Choosing the press, robot or MES before mapping the current sequence of changeovers and scrap points, which converts an operating-model question into an integration budget.
It is for you if you run or finance a manufacturer and a platform has been shortlisted and the target process has not been drawn. It is the situation where the numbers are available but nobody has put them in an order that produces a decision.
It is not for you if Percision is the wrong tool if you already know the answer and only need execution capacity, or if the business is pre-revenue — then the constraint is evidence about the market, not analysis of your own figures. Percision is not a lawyer, tax advisor, auditor, licensed appraiser, clinical or regulatory filer, or an AI implementation shop. It does not do HR casework, creative-only brand work, or impersonate a named consulting firm. It is a strategy analysis engine — not a template library. Also wrong if you need facilitation, politics, or someone to sit with a lender or buyer. Those are human jobs.
Percision is not a lawyer, tax advisor, auditor, licensed appraiser, clinical or regulatory filer, or an AI implementation shop. It does not do HR casework, creative-only brand work, or impersonate a named consulting firm. It is a strategy analysis engine — not a template library.
Below is an excerpt from a real run of this analysis on a manufacturer. It is a sample profile rather than a customer, and it is unedited engine output — this is the format you get, on your own numbers.
The subject is Kessler Industrial Components, a sample company profile used for testing rather than a customer — $310M revenue, three plants.
Excerpt from a real Percision run · Pricing Strategy · sample company profile
The move. Zero-capex JV turns existing tooling into recurring aftermarket cash flow that de-risks the entire diversification sequence.
The leak it closes. Eliminates 25–30% dealer take-rate currently captured entirely by OEM captive aftermarket
The assumption it rests on. Partner dealer network maintains exclusive shelf space for 5 years — the engine put the probability at 0.75.
| Investment required | $0 capex; $1.3M one-time operating expense for engineering time and legal fees |
| Expected return | Infinite (zero capex) on $12M Year-3 EBITDA |
| Revenue, year 1 | $4.8M aftermarket revenue (8% penetration) |
| Revenue, year 2 | $9.6M (14% penetration) |
| Revenue, year 3 | $14.4M (22% penetration) |
| Exit criteria | Terminate JV if aftermarket revenue run-rate remains below $2.4M annualized by Month 12 or if OEM contractual IP challenges block >30% of target SKUs |
This is one move out of a full analysis. Read a complete report — every page, no email required.
This question routes to Digital & Technology Strategy, one of 29 engagements the platform runs. For manufacturers it works through contribution per machine hour, capacity utilisation, customer concentration and scrap, then produces the sequence rather than a list of options — which move first, what it funds, and the observation that would say the sequence is wrong.
You watch the analysis get built before paying anything. Read a complete report here if you would rather see the depth first.
Different jobs. A consultancy is for deciding what should change and what the case is; an integrator is for making a chosen platform work. Buying an integrator to answer a strategy question produces a very good implementation of an unexamined process. Buying a consultancy to implement produces a slower, more expensive integrator.
The advisory piece is commonly £80k–£300k for eight to sixteen weeks in the mid-market. The implementation that follows is usually five to twenty times that, which is why the advisory phase deserves more scrutiny than its share of the budget suggests — it is the phase that sizes everything after it.
Take one transaction and count the manual touches and the waiting time between them. If most of the elapsed time is people waiting for a decision or an approval, it is a process and governance problem, and a new system will preserve it. If most of it is rekeying, reconciliation or lookup, it is genuinely a tooling problem and technology will move the number.
Materially, yes. The $45M automation case depends on the very customer that causes the margin problem — which changes both the diagnosis and the order of the fixes. The metrics that decide it here are contribution per machine hour, capacity utilisation, customer concentration, and an answer built on industry-general benchmarks will usually point at the wrong one first.
Less than most people expect. Your last twelve months of revenue and cost split the way you already split it, plus whatever you hold on contribution per machine hour and capacity utilisation. The analysis is explicit about what it is assuming where your data stops, which is more useful than waiting for numbers you may never have.
Percision is the wrong tool if you already know the answer and only need execution capacity, or if the business is pre-revenue — then the constraint is evidence about the market, not analysis of your own figures. Percision is not a lawyer, tax advisor, auditor, licensed appraiser, clinical or regulatory filer, or an AI implementation shop. It does not do HR casework, creative-only brand work, or impersonate a named consulting firm. It is a strategy analysis engine — not a template library. Also wrong if you need facilitation, politics, or someone to sit with a lender or buyer. Those are human jobs.
Percision is not a lawyer, tax advisor, auditor, licensed appraiser, clinical or regulatory filer, or an AI implementation shop. It does not do HR casework, creative-only brand work, or impersonate a named consulting firm. It is a strategy analysis engine — not a template library.
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