In recent years, many companies have invested in equipment to automate processes that were once performed manually. A simple example is a drive-through car wash, where robots wash and dry the cars rather than people.
Think of another company that might upgrade to an automated system and answer the following questions.
1. What impact, both positive and negative, might automation have on employee morale?
2. What impact might automation have on the skill level of the company’s workforce?
3. How might automation affect the quality of the product and the efficiency of the company’s processes?
4. How would you expect automation to affect direct materials, direct labor, and overhead costs? Would you expect any of these costs to increase or decrease?
5. How would you expect automation to affect variable costs and fixed costs? Would you expect either of these costs to increase or decrease?
6. How might automation affect the price consumers pay for the product?
7. How might automation affect the company’s bottom line, both immediately and several years in the future?