Automation is a vast scope of technologies that work to reduce the interaction of humans in processes. Instead of workers performing a task or handling machinery, an automated system runs on its own. This frees up workers to accomplish more highly skilled responsibilities and for the company to improve the quality and quantity of its product while simultaneously having more time and funding to expand.
Understanding the many benefits that automation can offer workers, companies, and the U.S. economy, Formic Technologies is working to speed the rate of adoption in the manufacturing sector.
“We started Formic with the idea that if we make it easy enough and risk-free enough for manufacturers, we would see a massive wave of adoption,” says Saman Farid, CEO of Formic.
Generally speaking, there are three stages of automation experience:
- There are businesses that may have never considered automation.
- There are businesses that have considered automation but have not yet implemented it.
- There are businesses currently using automation.
Traditionally, companies have had to spend a substantial chunk of their capital budget to purchase machines. More recently, Robots-as-a-Service (RaaS) business models have popped up, which offer robots as an operational expense through a subscription service.
Formic has a radically different approach. The company understands that many small and mid-sized businesses don’t have the funds to purchase their own robots and often don’t want to get locked into lengthy, expensive RaaS contracts. Instead, Formic offers flexible “robots by the hour” without any upfront investment.
Founded in 2020 by Saman Farid and Misa Ilkhechi, the company has already garnered media attention, appearing in Wired, Reuters, The Economist, Bloomberg Businessweek, and Crain’s Chicago Business.
“What sets us apart from the rest of the market is that we are not a vendor of equipment. We don’t try to sell factories on this piece of equipment versus that piece of equipment or these bells and whistles versus those bells and whistles,” explains Farid. “What we really are is a partner. We put up all of the capital necessary to put automation into a customer’s factory and guarantee that it will be productive for their business.”
In the latest episode of the Thomas Industry Podcast, Farid spoke with Cathy Ma, vice president of platform growth and engagement at Thomas and Xometry, about the three stages of automation.
1st Stage of Automation Experience
“In the manufacturing world, 90+% of factories have zero robots deployed,” reveals Farid.
Many companies have simply never considered automation. While they may be familiar with the concept, they may not know that any tasks in their facility are even eligible for automation. Although today we see automation everywhere from our Roomba® robot vacuum cleaners to the process automation that accelerates employee onboarding at our offices, automation may still seem like a futuristic technology that’s not accessible to a small American business.
The good news is that even if you don’t know much about automating, industry experts like those at Formic can help.
“We do an automation consultation for free upfront,” says Farid. “We’ll walk the floor with our customers. Very quickly we can come back and suggest a few places where automation is a good fit for their facility. We might say this CNC tending job and that packaging job and that palletizing job over there are things that we suggest are good fits for automation.”
“About 75% of the customers that we serve, we’re the first time that they’ve ever used automation,” says Farid. “That’s something that we’re really proud of because it means that we truly are making something that was previously inaccessible suddenly accessible to most factories.”
2nd Stage of Automation Experience
Many companies know that automation can improve production quality, increase output, minimize operating costs, and provide more safety to workers, among other benefits, and they’ve considered it for their business, and yet for a variety of reasons they haven’t gotten around to implementing it yet.
Finding room in their budget can be a major hurdle for small and medium-sized businesses that want to purchase their own fleet of robots. Beyond the technology, they are concerned about installation costs, engineering team requirements, and ongoing maintenance expenses.
“My advice for manufacturers who are considering automation is to really think about whether this is a core competence that they want to build in-house,” says Farid. “I would recommend meeting and talking to a few different vendors, maybe going to trade shows, and learning a little bit about what’s out there, and then really deciding on whether that’s the right place for them to invest serious capital.”
He says: “There’s one option, which is to invest hundreds of thousands of dollars and try to buy the right piece of equipment. Of course, there’s Formic as an alternative model, which allows you to do it without having to put a lot of risk, capital, and expertise into it yourself.”
3rd Stage of Automation Experience
The risk companies face in not beginning the automation journey today is that their competitors may have already started doing so. Even if they just dipped their toe into the proverbial waters to begin with, today’s successful manufacturing companies are expanding their integration of automation and optimizing their facilities.
“There are companies in the world who have invested serious resources into becoming great at automation,” says Farid.
He cites Tesla as an example: “They have a large internal automation team. They constantly are thinking about new ways to automate their plant and are bringing in different vendors and suppliers to buy equipment and then repurposing that equipment over and over again to produce cars.”
Although Tesla is not Formic’s most common customer type, some more advanced manufacturers are choosing Formic because of the unique scalability benefits.
Farid explains, “One of our customers already has 30+ robots and a large automation staff, but they cannot automate fast enough to keep up with customer demand. Their capital budget is a bottleneck and continuing to grow their in-house maintenance is counterproductive to their core business. We enable them to bypass both of those issues 一 with zero-capital investment robots and maintenance included.”
Farid summarizes it as, “Our customers simply don’t want to be in the business of automation. They just want to be more productive for their customers.”
No matter what stage a manufacturer is in, automating is becoming a greater necessity for any business that wants to remain competitive today.