From ROI to Reality — Measuring Success After You Automate, Ep #32

[0:00] Dave Vuyk: It’s more about embracing the journey than obsessing over the destination. And what I mean by that is you’re going to get to the destination if you embrace the journey. Hey folks, welcome back to the Lights Out podcast.

I’m David Vujic and I’m here with Eric Nekkich. We’re unfortunately still missing our beloved co-host, Saint Nick Golner, who will be back on the next episode, we promise, but he’s making things happen. Over the last three, no, last two episodes, this is episode three in a three-part series, we’ve been talking through the market trends, forcing automation adoption, and we’ve been talking about the math behind ROI calculations and the deployment strategies that separate successful launches into automation from ones that struggle.

And here’s what we’re hearing from shop owners right now, you know, we pulled the trigger, we’ve got automation running. The question that keeps us up at night is, am I actually hitting the numbers that I projected? Is it working?

How do I know this is performing? So that’s what we’re going to tackle in this third part of the series, this final part of the series.

[1:26] Eric Nekich: Absolutely. Great to be back with you, David. And yeah, I mean, God bless Ron Papil, but automation is not ever going to be set it and forget it, right?

And there’s going to be a number of things we’re going to want to do after that automation’s been implemented, it’s been integrated, we’re running it, there’s going to be a number of things we want to do post-implementation to ensure that we get that ROI over a sustained period of time. And I think that it’s a great way to wrap this series. And, you know, let’s start there, right?

Let’s start with post-implementation measurement, right? How are we, what are the things we can do high level to make sure that we are maintaining ROI, right?

[2:14] Dave Vuyk: Yeah. I mean, without a clear measurement framework, you know, you could be kind of flying blind, right? You might be leaving opportunity on the table.

I mean, I’d hate to think that folks are leaving 30, 40% of the ROI on the table because they’re just not intentional about what they’re tracking. So that’s what we’re talking about today. It’s not just about validation.

It’s visibility so that we can continue to improve the process and optimize things as we go.

[2:41] Eric Nekich: Yeah. Much like what you’re buying here, we talked about this in the first two episodes. So I might as well just, you know, kick the horse in another spot.

And that is really using the metrics to take your gut out of the equation, right? You see, I see it all the where it’s installed, it’s running parts. You come in Monday morning to finish part.

And people just think that like, that it’s going to continue to deliver consistently without monitoring it, or even like taking it one step beyond that ROI. And it’s, you know, how optimized are the processes? What’s the next bottleneck?

But I don’t want to get too far ahead. We’ll shoot it back your way, sir.

[3:20] Dave Vuyk: Yeah, well, you know, it’s interesting. Ahead of this podcast episode, I was doing a little bit research. And according to cascade, which is an organization that publishes research on manufacturing KPIs, there are 33 core manufacturing metrics that you could theoretically track.

But I mean, I gotta ask you, Eric, you’ve been in a lot of shops, do you meet a lot of shop owners who’ve got the bandwidth to track 33 different metrics? I was going to insert the joke only 33.

[3:48] Eric Nekich: Well, I would have guessed at least 63. No, absolutely not. I think that 33 is asking for trouble.

[3:59] Dave Vuyk: Right. So I think probably a better plan then is maybe to focus on the KPIs that kind of tie directly back to the ROI calculations we were talking about in episode two. Right.

Is now a good time to jump into those you think?

[4:15] Eric Nekich: Yeah, I think it’s a perfect time for that. And I think you know, I think a great question out of the gate is how do you set those KPIs? Right.

And if you go back to the first, I think, two episodes and maybe even a continuing theme in the Lights Out podcast is what is the business problem that the automation was? You know, you invested in automation to solve a business problem. What was that?

And those post implementation, it’s a heavy series of two words that post implementation ROI, I think, needs to focus on that because that’s the business challenge that we’re trying. Right. That was what the investment was for.

Absolutely.

[4:56] Dave Vuyk: Yeah. So some of the things that we had talked about in episode two had to do with, for one, labor cost reduction. So obviously, that’s one of the drivers of automation.

We also talked a little bit about material scrap rate. You know, you might not see a massive improvement on that. I mean, quality improvements typically take a little longer to manifest, but you certainly don’t want your scrap rate to increase as a result of that implementation.

Throughput increase is kind of tied a little bit into labor cost reduction, but then being able to run something through the night to increase your capacity without increasing head count in square footage and machine tool count. A big one is equipment utilization. Right.

So we’re making better use of the spindles we have. That’s a huge one. So, I mean, right there, there’s four KPIs that are kind of a good basis.

[5:55] Eric Nekich: Yeah, absolutely. I mean, you would call those almost your core KPIs in any automation, not even post-implementation, right? But just even that initial ROI grab, those are really core attributes you’re going to want to be measuring. Dave Vuyk: Absolutely. So, I mean, if a shop owner called you and they’re 90 days into having purchased a piece of automation and they say, hey, Eric, I’m at 20% labor cost reduction, 15% throughput increase, what would you say? Is that shop on a good track?

[6:25] Eric Nekich: Yeah, absolutely, David. I think 90 days out, that’s a very reasonable return. I think that that reduction in labor and that increase in throughput is valuable to a lot of shops.

And to be achieving that ROI 90 days into a system, I don’t know how you’re upset with that.

[6:46] Speaker 4: Hey, Paul, next year’s 2026. Guess what happens?

[6:50] Speaker 3: That means it’s an even year, which means IMTS is happening. I’m so excited. And I assume ProShop will be there exhibiting again, as always?

Yeah, it’ll be our fifth time, I think. It would have been six if COVID hadn’t happened. But yeah, even after being there that many years, there’s a lot to understand about that show.

It is a massive event, massive execution to exhibit. On a big investment, right? It’s got your time, your money.

It is a big investment. Yeah, it’s one of our biggest marketing investments for sure.

[7:17] Speaker 4: Well, I’m looking forward to in January, you and Nick and I are going to be at the IMTS exhibitor workshop where exhibitors can come and learn how to get their most out of IMTS.

[7:27] Speaker 3: Yeah, the workshop is fantastic. There’s a bunch of different benefits from it. One, you can connect with all the vendors for your furniture, for your logistics, getting all your stuff in and out of the show, electrical, everything.

But this year, they’re also doing an executive session or series. So really focused on getting the most out of the conference. How are you going to go in with a marketing plan, really execute it and get your maximum ROI if you’re exhibiting at the show?

[7:54] Speaker 4: Well, it’s a major commitment to go to the show. I go as an attendee, but seeing all the work that goes into it, if I was exhibiting, I would definitely want to maximize my experience there and get the most out of it. And the workshop I know is going to be interactive where they really work through things.

Like you said, you can place the orders, all that type of stuff. And that’s going to bring a bunch of value to exhibitors.

[8:16] Speaker 3: Yeah, absolutely. The difference between coming with a plan and executing on that, it’s a big difference as opposed to just showing up, throwing up your booth and hoping for the best. So yeah, it’s definitely advisable.

So exhibitors that want to make more of it, whether they’re a first time exhibitor or even if they’ve done it many times, but they really want to maximize their ROI this time, they should definitely show up at this thing. And what are the dates again?

[8:36] Speaker 4: Yeah, so it’s January 27th to 29th at the McCormick place. So you kind of get familiar with where your booth is going to be and all that type of stuff. To find out more, people should just go to amtonline.org slash events and get signed up and we’ll see you there in January. Sounds good, Mike.

[8:52] Dave Vuyk: Yeah. And I mean, it’s important to remember, too, it’s not just about labor savings. A lot of people kind of think about that and they start kind of stop there.

But when you pile on the increased throughput, the utilization gains, the improvements in quality, you’re actually even farther ahead than just that. So it’s important to kind of keep a balanced set of KPIs with that project to really understand the total benefit. The other KPI that kind of came to mind would just be your cost per unit, which, depending on the type of work you’re taking on, may be easier or harder to quantify.

But that’s kind of a typical one. I mean, if you’re in more of a production environment, which typically lends to automation, is a good one to keep an eye on as well.

[9:44] Eric Nekich: Yeah, absolutely. Yeah. And just to kind of pin off one thing you mentioned there, too, I think it’s important to stress that when we are redeploying those labor savings into more value-added functions of the company, it almost compounds, right?

Because let’s say now I don’t have a valuable member of my team simply loading workpieces in and out of a machine tool. I’ve got automation doing that. They’re off on the side optimizing programming, right?

They’re taking a good look at cutting toolpaths, maybe bringing in new pieces of workholding. And that just compounds the ROI. So now, again, you’re looking back at it 90 days later.

And if you’ve redeployed that labor intelligently, I mean, the KPIs just start to really take off.

[10:38] Dave Vuyk: Well, and that’s where, you know, you can actually tie in another KPI. And I don’t want to create this massive list of KPIs that feel impossible. 33.

We’re going to get to 33, folks.

[10:49] Speaker 5: We’re going to get there.

[10:51] Dave Vuyk: Definitely not before 10. We don’t have enough time to record to get all 33. Okay.

But this is more of like a business health indicator as a result of that automation implementation, which would be manufacturing cost as a percentage of your revenue. So let me explain. Like if your pre-automation manufacturing cost was 60% of revenue, which means you’re keeping 40 cents of every dollar for overhead and, you know, profit and reinvestment.

And let’s say post-automation, you dropped a 55%. Well, you’ve just added 5% of profitability to every single job. That’s not just ROI.

That’s kind of a more sustainable competitive advantage for your business moving forward. So, you know, definitely another one to think about, which is kind of a more broader picture, you know, business health target. Absolutely.

[11:45] Eric Nekich: Okay. So now we’ve identified these core KPIs. You know, we’ve talked a lot on this podcast about how sometimes that language doesn’t translate really well to the shop floor.

So how can we put that in context, right, when, you know, we just gave some examples of a reduction in labor, but like what does an increase in throughput, you know, what are those advances and those gains look like on the shop floor?

[12:14] Dave Vuyk: Yeah, I mean, shop floor teams are all different, right? But I would think a lot of them, they’re not waking up in the morning thinking about cost per unit or OEE or, you know, that doesn’t necessarily always translate well to the people who are actually making it happen on the shop floor. They’re thinking more in terms of, hey, are we making more parts this month than we were last month?

Are we dealing with a lot of downtime or, you know, are we conquering that? Are we making a ton of scrap or not? These are kind of the more practical things or aspects that they’re seeing in addressing on the shop floor.

[12:51] Eric Nekich: Capacity gains, right? Dave Vuyk: Right. Absolutely. Hey, you know, that job that used to take us a week and a half, you know, takes us less time now because we’ve changed our process and included automation, that kind of stuff.

[13:05] Eric Nekich: Outstanding. You know, capacity gains, that’s always an interesting one to me because I feel like, you know, it’s great for lead times, but I also believe it positions a lot of customers to bring in more work, right? And, you know, happy customers buy more things.

So again, when we talk about compounding ROI, even though I know that’s not this episode, I just feel it’s worth pointing that out that so many of these honestly like branch off into other metrics that just continue to, the snowball just gets bigger and bigger.

[13:38] Dave Vuyk: Yeah, absolutely. I mean, I think a lot of this kind of comes down to OEE and maybe that’s a good one to drill into a little bit because that might be one of the metrics that folks are more aware of or more interested by in terms of something that they’re actually going to measure on the shop floor. And of course, you know, OEE breaks down into three components availability.

So what percentage of scheduled time is the equipment actually running, not in breakdown mode, not in changeover mode, not waiting for raw materials performance when the equipment is actually running? Is it running at the designated speed? Or is it running at, you know, 80% and quality?

So when the parts come off, what percentage are actually good parts versus bad parts? So that’s a really common metric that I think the whole team has to get involved with to improve. Technology can help, but it really comes down to bringing in the team, having a culture of continuous improvement, making those process improvements.

And I think that’s one you can celebrate as a team. You know, if you’re doing weekly standups, that’s a great metric to review and track your gains.

[14:52] Eric Nekich: Yeah, absolutely. And again, to the overall health of the company, right? There’s so many times we see a process automated that creates issues upstream or downstream from that process.

And OEE is just a perfect way to manage that, right? So, you know, your performance could be through the roof, but if the availability is not dialed in, it affects performance, right? And everything from there on, you could be running, you know, your spindle utilization could be good, but if the scrap rate’s high, then your quality suffering and your overall OEE is going to show you that.

[15:28] Dave Vuyk: Yeah, I mean, let’s say you’re a shop owner and you’re four weeks into having installed a piece of automation, let’s say a pallet pool, and you measure your OEE and you find that you’re at 65%. I mean, is something broken? How do we know if that’s, you know, a good number or not?

I think it’s a great diagnostic question. And that’s where you really have to understand the relationship of those three components to your point. I mean, if availability is at, you know, 70% and performance is at about 95% and quality is at 98%, which sound like amazing numbers, your OEE is going to be 66%.

So, just kind of remember that kind of how that OEE number is affected by the three variables. You can actually be doing really, really good and just be suffering in that one area, and that OEE number is going to maybe feel a little low. You know, it could be in that case when availability is at 70%, maybe downtime’s eating you, maybe equipment is breaking down, or maybe you’re waiting for material.

Those are the things you need to investigate so that you can improve on those numbers.

[16:35] Eric Nekich: Absolutely. So, you know, when we talk about the core components of OEE, I think that’s a good like kind of transition into some of the peripherals around automation that, if done correctly or done incorrectly, can either like complement the ROI or extend it much longer than you were hoping for. And one of those things, just it’s no secret here, I love workholding, but one of those things when it comes to automating definitely is the fixturing.

Whether you’re, you know, doing just basic tending or you’ve opted for some sort of a palletized system, you know, if you’re using the wrong workholding, we see it all the time, people buy a five-axis machine tool, which in and of itself is a form of automation, right? But then they’ll stick with some sort of traditional workholding device, traditional clamping methodology, and you’re just not, you’re not maximizing that technology. It’s holding you back from the ROI you should be getting with that five-axis machine tool.

We’ve seen it in automation too, right, where you bring in like automation systems that have nice big work envelopes, great payloads, but you don’t take advantage of that, you don’t take advantage of that high-capacity design, right, to increase your part density, so you still kind of get into this one-piece flow. You know, obviously that might not be a problem in a low mix situation, but low mix situations, if you’re not using the correct workholding, you could run into accessibility or rigidity issues. So, I guess where I’m going with that is workholding is a prime example of something that if you do it correctly and you leverage an expert, it can actually speed up your ROI, right, to where if you’re not doing it correctly, it can really have a negative impact on that process you’re trying to automate.

[18:26] Dave Vuyk: Yeah, well said. I mean, it’s probably one of the biggest, most impactful things that you can do right off the hop to kind of add rocket fuel to these KPI improvements, just making sure that your workholding strategy is aligned with everything else that’s involved in the process, you know, to kind of build on that same theme, like what are some of the things you can do to accelerate, you know, these gains and these core KPIs and these gains in ROI would also be attacking all of the reasons why your OE might be suffering, right? In that example, we talked about, well, why might availability be low?

It could be you’re suffering from machine breakdowns. It could be some kind of process reliability, like coolant issues. Yeah, chip management for sure.

Issues. So, you got to be really cognizant about the full process when you’re attacking this. And again, enabling your team, because they’re your eyes and ears on the shop floor, to really be serious about process improvement.

When they see something, they’re bringing it up, they’re suggesting improvements in ways that, you know, you can get around those things. It doesn’t always have to be expensive. I mean, sometimes it is.

That’s the nature of machine shops, unfortunately. But even having something like a machine monitoring solution in place, that’s kind of more proactive in picking up on some of these, you know, I’m speaking here specifically about process monitoring, so that you can pick up on any of the process issues and get on top of your process reliability.

[20:05] Eric Nekich: Yeah, absolutely. And I think it also speaks to, you know, ownership over the ROI on the shop floor, right? Ownership of the ROI, if it just lives in the C-suite, is seldom success.

I just, I don’t see it as successful as often as when you’ve got great shop floor buy-in, right? You’ve put a team of people and you’ve tasked them with that ROI and making sure that it’s a success. Those are the things where, like, when I’m in those shops, those manufacturing facilities, when we’re getting calls, you know, whether it’s for workholding or on the automation side of the business, but when we’re getting those calls from those teams, those people where it has become an intrinsic part of their job responsibility to make sure those investments are maximized, that the ROI is there, it’s insane how much they get done. I mean, you’ve been in those shops, David, where they’ve got people that are directly accountable for the success of that ROI on the shop floor where the action happens, and they’re beautiful facilities.

[21:12] Dave Vuyk: Oh, absolutely. You can, the second you step into one of those shops, you kind of understand that, you know, they’re set apart from the rest for that reason. Yeah, couldn’t agree more.

[21:22] Speaker 3: Paul, tell me about your trip to Italy. I went there with the NTMA and we got to tour SMW Autoblock. Two different facilities, absolutely blew me away.

World-class, enormous places. I can’t even count how many machines there were, but so much automation. One of the most incredible takeaways for me was the breadth of what they made.

I did not know they made so many workholding products and automation products. And I loved watching a big chuck machine a little chuck. So they were machining chucks in huge lathes.

I thought that was super fun.

[21:53] Speaker 4: Yeah, you introduced them to me after you came back and they’ve been to my shop and the ideas they have to like breathe new life into some of my machines and the tools and the jobs that were running was just shocking.

[22:05] Speaker 5: And then one of the coolest things is we’re bringing this new automated pallet delivery system, the Hennig workflow to market. And guess what the interface is? It’s SMW zero point locators.

It’s really sweet.

[22:17] Speaker 4: We’re getting ready to get some of those. Speaker 5: So how do people find SMW Autoblock to look through that massive catalog of products? Speaker 3: It’s smwautoblockblok.com. Speaker 5: Yeah, get rid of that. SMWautoblockblok.com.

[22:33] Dave Vuyk: I did want to touch on kind of the the benchmarking and comparison conversation. Sure. You know, we’ve talked about some great metrics to track.

But I think, you know, one of the questions every shop owner is asking is, okay, now we’ve got the numbers. How are our numbers? Are our numbers good?

How do they kind of compare themselves against other shops?

[23:00] Eric Nekich: That’s a great question. And I, I always encourage them not to. I always, I always, yeah, everybody wants to know how they hold up to to the shop next door, or maybe even like to like Toyota or something like that.

Right. And my advice, and I mean, feel free to correct me. If you think I’m wrong here, my advice is always, you know what your business challenges are and what you’re trying to solve.

And you also know your P&L. So, you know, you tell me if what numbers are good, right? Again, if we go back to OEE, if the issue is the machines just aren’t running, and you solve that issue with industrial automation, does it matter what Sam’s precision is doing down the street?

I always want to always think about the automation trap series that we did when we first met with Klaus and Gary. And, and I mean, I think this is a perfect, this is a perfect, like, it’s a perfect example of what we’re talking about here, right? I think it was Gary, was Gary the owner of Iron Clunk?

Yes, he was. And he got wrapped around the wrong things that Klaus was doing, right?

[24:24] Dave Vuyk: Yeah, absolutely. I think, I think the important thing to keep in mind is that it’s more about embracing the journey than obsessing over the destination. And what I mean by that is you’re going to get to the destination if you embrace the journey, if you take process improvement seriously, if you take the time to measure and review the data and share it with the team and get them excited about improving things.

I mean, what a great way to gamify the machine shop floor when you get everyone involved and bought in on, you know, you’ve got a, you know, a dashboard that you review together and you can celebrate, you know, how those different metrics improve.

[25:06] Eric Nekich: It’s been one of the most rewarding things I’ve ever seen in shops is when, when you’re, you’re on the shop floor and this team, they’ve almost become the automation experts. Like there’s been several times where I’m sitting there trying to like consult and I’m like, I have no business being in this room. They know more than I do about the processes here and, and the work that they’ve done and what’s worked and what hasn’t and how they’ve measured it and the KPIs that they use.

[25:36] Dave Vuyk: Yeah, well, ahead of this, this, you know, recording, I did dig a little bit into the data. So according to this 2025 manufacturing KPI research from insight software, they go out and they aggregate data across manufacturers. Here’s a, just some generic while generic values that they provided for OEE.

So industry average, according to this report is 60 to 70%. Um, and that makes sense to me. Um, industry leading is 80 to 90%.

Um, now I would kind of interject there, like you would have to be really world-class to kind of get into that category. That is really tough to pull off. Uh, it’s a great objective.

Uh, but again, that average for OEE is kind of in the range of 60 to 70% for on-time delivery and which obviously automation can, can help with if you’re kind of increasing that, um, uh, capacity, um, average, right. You know, is about 85 to 90%. Good would be 95% plus, you know, shout out to, um, our sister show machine shop mastery and, and Paul van meter and pro shop.

Uh, they’ve got great tools built into that ERP. So you can measure your OTD. Uh, so kind of, uh, uh, cool.

And that’s baked right into your operating system. Um, other things like cycle time reduction and average would be 15 to 30% faster. Again, it’s the average kind of range when you’re adopting automation technology.

[27:10] Eric Nekich: Those are remarkable metrics. And I think that they’re super helpful. Dave Vuyk: The caveat is your shop is not identical to the industry average, right? A job shop doing custom work is going to have different targets than a high volume production facility, but the benchmark, you know, those, those industry averages give you a reference point.

[27:32] Eric Nekich: Yeah. Very helpful. Like you said, just kind of a nice basic benchmark.

Right. Uh, so yeah. You know, one thing that I always like to talk about too, and I think it’s important, uh, you know, we kind of keep coming back to this crawl, walk, run mentality.

Right. And there is like, it’s a common pitfall where people are like, well, I’m just going to buy this system. And then I’m going to run all weekend.

And I think it’s, I think along with setting the KPIs, I think it’s, it’s, it’s important that you set sort of, uh, realistic targets on, on timeline and, you know, uh, sort of those, those thresholds that you’re going to cross as you build up to like running lights out or running over the unattended over the course of a weekend or, or something like that. I just like to throw that in there. I have yet to see someone just park it.

And then on day one, that thing runs all weekend. Yeah.

[28:29] Dave Vuyk: That is just not realistic. You know, you, you got to build there one step at a time. The cool thing I think is that when you start tracking this data, you can start to actually make projections.

Right. Um, so, uh, you know, you can look at the previous month’s data and say, Hey, we’re on pace for an eight month payback or, you know, whatever it actually is, but you can then use that data to kind of project forward where you, you might end up if you’ve got six months of, of process improvement data that coincides with your, your automation ROI, you can kind of, you know, project that forward and see where you’re going to end up. Yeah. So that, that’s kind of a really nice tool that to be able to have as well.

[29:11] Eric Nekich: Yeah. And it’s, it’s also another great way to take kind of like your other KPIs. And I mean, you can do some projections as to where the bottlenecks would be that would keep you from those goals.

Right. Again, as simple as breaking out OEE, right. If the lowest percentage in your OEE is, you know, is going to be quality.

Well, that’s going to be the bottleneck. What are some things we can start improving over there? Um, as an example.

[29:38] Dave Vuyk: Yep. Yeah. It’s a bit of a feedback loop, you know, it’s like measure, diagnose, communicate, adjust.

And every time, you know, you run that cycle, you know, you get better and better. Continuous improvement. Awesome.

Eric, we should also kind of bring this, you know, back to the people. I think like one of the hardest things to accomplish is tying this all together with the shop floor team in a way that motivates them a way that doesn’t feel like surveillance. You know, I think it’s important to underline that there’s a responsibility for the change management piece and to just make sure that everyone feels like they’re part of the process.

I think that comes down to really answering the question of why, why are we doing this? Sharing maybe some of the baseline metrics, not necessarily like full open kimono on the company financials, but hey, here’s where we’re starting from. We want to see where we can get to.

Do you have any thoughts or comments on that?

[30:40] Eric Nekich: Yeah, you know, it’s really interesting. You go back like 10 years, I mean, 10, 15 years, there was, you know, that initial kind of negative response to automation of it’s going to take all these jobs, right? And that’s really gone away.

I mean, at least just speaking from the sales process that rarely ever comes up anymore. Everybody kind of gets now that it’s about redeploying labor, that nobody really wants to be doing this kind of repetitive, but nobody wants to be doing this kind of repetitive work, right? And they see the opportunity to like move up and where the value add is to like for the company is like doing more things, working on the business, not necessarily at the business, right?

Then when it comes down to ownership of these tasks, you’re absolutely right. It’s about transparency, about why we’re automating what we’re automating, right? And I mean, I hate to say it, but metrics can even help you with that.

Like you said, you don’t have to peel back, you know, open the bank account. But if you do that initial time study, rolled throughput yield, something like that, that’s where the holes are, where the bottlenecks are, where the problems are, right? What’s keeping us from advancing forward.

And then we feel this is where the automation would help, right? But I feel like if you have, you know, again, coming back to that business challenge, employees aren’t naive. They’re aware of those challenges too.

Oftentimes they’re just as frustrating for the machinist as they are the production manager, right? So if the solution to that involves automation, in my experience, most times you’re going to get a resounding please, you know? But again, like you said, it’s transparency and explaining why it’s there.

If I came to you and said, David, I’m buying a Finuc robot because quite frankly, I don’t want you here anymore. And I feel like the robot can do your job. You’re probably going to have a negative reaction to it.

[32:48] Dave Vuyk: Well, I actually thought if, you know, Nick doesn’t join us again for an episode, we’re just going to have to build an AI agent to replace him. So Nick, you’re on notice. You’re on notice, pal.

Listen, I think we can, you know, if you’re an employer, you can kind of tie that back to what was that metric we mentioned in the first episode of this series from MT Forecast? Something like automation adoption is up.

[33:11] Eric Nekich: The adoption rate, yeah.

[33:11] Dave Vuyk: Like 30% in 2025. And guess what, guys? It’s 2026 now, right?

So, you know, I think that’s a good indicator that this is where the industry is headed. So when you’re having this conversation with the team, it’s like, this is the reality of where things are at. You know, if we want to stay competitive, we want to stay successful.

We want to grow revenue and profitability because that also means that you can, you know, help your team members be more successful. And, you know, bigger bonuses are only possible when the business is healthy. So, you know, there’s ways to kind of motivate excitement about it from that perspective.

But I think when metrics become a conversation, not a surveillance tool, when the team becomes a part of that optimization process, you give folks a role to play in this exciting new story of being a modern tech enabled shop. And they spot the problems and help create the solution. You know, I think that’s a wonderful place to be.

And I think that’s really the goal.

[34:17] Eric Nekich: I agree. Dave Vuyk: I agree 100%.

[34:20] Eric Nekich: So, you know, we’ve covered a lot. I kind of want to get into, like, the tactics, right, that we do at the end of every episode. We need an action plan.

We need an action plan. So, again, kind of circling back to the whole purpose. I know I love all these roads we kind of go down and these side quests we do.

But, I mean, at the end of the day, it’s about you’re not going to set it and forget it. When your automation system hits the floor, there’s more work to do, right? And it’s up to you to ensure that it’s performing as intended, as you planned on it performing when you had the dream that this thing was going to come in and solve, you know, business challenge XYZ.

And, you know, we’ve talked about some core KPIs. David, my friend, what are three things we can do post-implementation? Again, and I love these tactics because we look for, like, things, like, pretty much anybody can do, right?

They’re all relatively economical. Just about anybody can do them. So, what are the three post-implementation tactics we’ve got to help lock in ROI?

[35:37] Dave Vuyk: Well, you know, I think just as a reminder from episode two, you know, you want to pull together your pre-automation baseline data. So, just a reminder there. We already talked about it.

That’s not a new action, but just a reminder in case you didn’t hear the last episode. That’s an important starting point. I think you want to pick your core metrics that you’re going to track.

And my suggestion would be that OEE throughput and utilization should probably be on that list. What do you think, Eric? I think so.

[36:09] Eric Nekich: I think they’re pretty universal, right? Dave Vuyk: Yeah. Eric Nekich: I think it’s important to create sort of a standard because I’ve never, ever, ever been in a shop that just buys one piece of automation and stops there, you know?

[36:22] Dave Vuyk: I think you need to also then define your measurement system. Not everyone has, you know, fancy machine monitoring, process monitoring. So, it could be a spreadsheet at minimum.

It could be a pen and paper at minimum, frankly, to kind of start pulling this data and tracking it on an ongoing basis. You want to get your team involved. Again, they’re your eyes and ears on the shop floor.

I think operator logging of data when you can do it is helpful. I think you want to do a regular KPI review, not just with your leadership, but your whole team.

[36:54] Eric Nekich: Amen to that. Yeah, absolutely.

[36:57] Dave Vuyk: And, you know, celebrate the wins as they happen and really build that culture of continuous improvement. Remember, it’s not just, hey, buy a Palette Pool and all our problems will be solved, and people understand that. But it is more about embracing the journey and this kind of, you know, having a team that’s hungry to keep improving the process and getting better.

And when you gamify that with KPIs, when you have that on dashboards that everyone can see, and when you celebrate the wins, I think you can get some real momentum behind this journey. And of course, tying it back to the theme of the series, you’re going to get great ROI, which means your business is going to be doing really well also.

[37:39] Eric Nekich: Phenomenal. You know, David, every time we do an episode together, I pull something you say that just, it’s great. And I plan on plagiarizing you.

Metrics not as a surveillance tool. Yeah, absolutely love that. No, I think that that’s really good.

And it should resonate with a lot of people. So yeah, great episode, David.

[38:00] Dave Vuyk: I agree. Okay, well, I think that’s a wrap. So that’s it for this episode of Lights Out Podcast and this series on ROI.

Big thanks to my co-host, Eric Nekkich, for helping us break down how to actually measure success after you automate, because automation only works if it delivers real ROI. If this conversation helps you think differently about what to track, how to benchmark, and where automation is really paying off, make sure that you like and subscribe so that you don’t miss any future episodes. And please share this episode with a friend or colleague who might be interested in automation or who is actively investing in it and wants to make sure that it’s actually moving the needle.

At the end of the day, Lights Out Manufacturing isn’t about buying technology, it’s about measuring outcomes. We’ll see you on the next episode.

[38:53] Speaker 3: Yeah, I’m gonna get these lights on the way out. Take care, David. Hey, it’s Paul from Makin’ Chips.

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