Robots in the workplace are rapidly increasing in popularity. According to the National Institute for Occupational Safety and Health (NIOSH), robots are becoming increasingly prevalent across job sites and are no longer confined to cages and robotic work cells. Instead, "today's robots are designed to work alongside, move amongst, and be worn by human workers" (NIOSH). The increase in popularity can be attributed to the many advantages robots offer, including increases in productivity, efficiency, and safety. However, some organizations are still concerned about the investment of adopting a novel solution like robotics, especially in industries where robots are still relatively new.
Whether you're considering a robotic vacuum or delivery service robot, it's true. There is an investment required for the initial purchase, as well as ongoing costs. When selecting workplace robots, it is vital to understand both the total cost of ownership (TCO) and the solution's expected return on investment (ROI).
From employee support to customer retention, today's robots can impact your operations in surprising and powerful ways. Below we consider the business case for investing in robots in the workplace. As you consider the many ways a robotic fleet can benefit your operations, it becomes clear that the advantages of robotics in the workplace quickly outweigh the costs.
The Cost of Robot Labor
One of the highest ongoing expenses of any business is headcount. Meanwhile, budget cuts and labor shortages have made it extremely difficult to hire new workers. Robots are a powerful complement to your existing workforce; they fill the gap created by labor shortages, support your team, and drive cost-saving efficiencies. After the initial investment in a robotic solution, ongoing operating expenses–such as routine maintenance and upkeep–are much lower than adding headcount.
Improving labor process efficiency with the help of robots enables organizations to increase their bottom line by freeing up their staff's time to work on more meaningful activities. With a collaborative workplace robot (or cobot), efficiency gains begin to grow – not by replacing your workforce, but by allowing them to focus their hours on higher-value activities.
For example, many organizations find that vacuuming takes up approximately 30% of total facility cleaning time. When this repetitive task is automated, cleaning teams report a 25% boost in efficiency. The existing cleaning staff can then relocate their time to higher-value services like disinfecting, deep cleaning, and polishing. This efficiency in how your team uses their time can prevent overtime costs to achieve the same results.
How Robots Impact Employee Hiring and Onboarding Costs
In addition to reducing the costs of finding and adding headcount, labor-strapped organizations find that cobots can help retain their existing workforce and reduce their hiring and onboarding costs. Replacing an employee can cost one-half to two times that employee's annual salary – and cleaning has one of the highest turnover rates. As a result, having a solid retention strategy is a critical cost-saver. In this case, cobots provide a few key benefits. Robots help reduce the monotony and strain of repetitive tasks like vacuuming and offer new opportunities for your employees to grow their skills and develop professionally.
For example, many organizations are implementing robot manager roles that allow their team to gain new and in-demand technology skills–engaging and rewarding work. It's a formula that's proven to work well in manufacturing, where the presence of robots works to create new, higher-paying jobs. These opportunities can help you retain talented workers and keep them more engaged, ultimately making them more productive.
How Robots Impact Customer Retention Costs
Beyond enhancing the employee experience, workplace robots also offer significant customer-facing advantages. For example, retail environments and hospitality venues see many benefits, including cost savings, from their robotic investment. That's because service robots can directly impact these organizations' customer retention and related costs.
The lifetime value of a customer is often calculated by the average amount a customer spends on a given order, their repeat purchase rate, and the cost of acquiring new customers. The more an organization can do to increase purchase rates, the greater the value of that customer. Research from Bain & Company and Harvard Business School indicates that rising customer retention rates by 5% increases profits by 25% to 95%.
As a result of the labor shortages impacting numerous industries today, housekeeping and maintenance often suffer. A 2016 retail study by market research company Harris Interactive on behalf of Cintas Corp. determined that 93% of adults in the United States would not return to a retailer due to a lack of cleanliness.
In hospitality, a 2016 study by hotel booking site Trivago and P&G Professional found that of the guests who rely on online reviews before booking rooms, 71% expect "above average" cleanliness ratings when choosing hotels. One bad experience can create a ripple effect of negative referrals—while customers reward above-average cleanliness with greater loyalty.
Robotic vacuums, food delivery robots, and other automated tools allow staff to do more with their time and create a clean, welcoming environment that promotes customer satisfaction and drives repeat customer visits.
The Cost of Maintaining Robots
As noted above, robots require routine maintenance; however, this is a relatively minor ongoing expense. Yet many organizations find this a simple investment of time for basic cleaning.With tools like the autonomous robot vacuum, Whiz from SoftBank Robotics, maintenance includes simple, manageable tasks like replacing HEPA filters and dust containment bags.
In addition, organizations find that the cost of robots in the workplace can reduce the operational expense of cleaning through one-time capital expenditure. Purchasing a cleaning robot allows organizations to amortize the cost of the equipment over its lifetime. These cost savings can be reinvested or help offset rising labor rates for cleaning staff.
Not all organizations reap this full range of benefits. Many organizations fail to reap the benefits when they see a workplace robot primarily as a tool rather than the foundation of a new operational strategy. But when organizations take time to develop a strategy that allows them to leverage their investment more widely, they will find a far greater return over time.
SoftBank Robotics is Here to Help
Given the newness of robots in many workplaces, it can be challenging to develop a robotics strategy independently. An experienced partner can help. For greater insight and support in maximizing the impact of automation in your workplace, contact SoftBank Robotics today.