In the post-pandemic age, automation is more than a solution for labor shortages. It’s the future in a quest for efficiencies, agility, and competitiveness. For packagers, they are wrestling with questions of costs—searching for a justified return on investment—and the need to form external partnerships to aid in transitions.
Pre-pandemic, workforce shortages were positioning automation as a solution “for eating into the total number of human hours or labor,” says Matt Reynolds, editor at Packaging World, PMMI Media Group. As companies continue to struggle to find workers, even during the pandemic, the issues of automation have become more pronounced. PMMI, at its PACK EXPO Las Vegas, Sept. 27–29, will dedicate several sessions to the emerging trends.
The trends are being felt among converters, consumer packaged goods companies (CPGs), and the original equipment manufacturers (OEMs) that make automated machinery. Increasingly, CPGs are adopting machine and software automation, but the return on investment and a lack of internal expertise remain barriers, according to the “Automation Timeline: The Drive Toward 4.0 Connectivity in Packaging and Processing” produced by PMMI Business Intelligence.
Return on investment is the key driver in deciding where and how to automate. CPGs typically base their capital investments on brand innovation, the safety of products and operations, a need for infrastructure updates, and compliance with external regulatory matters. They also might have internal needs such as ergonomics or reducing safety claims, says Robert C. Champion, president, InnoFlex Solutions. InnoFlex provides technical consulting services to consumer food manufacturing companies (CFMCs), as well as to the capital equipment suppliers at their factories.
Consumer demand is driving brand innovation, which in turn sends CPGs to OEMs for the robotic equipment that aligns with strategy, Champion says. However, traditional 18-month timelines are shrinking to 12 months. In this accelerated atmosphere, for example, typical production lines aren’t designed for the flexibility needed to pivot to delivering the latest flavors, food forms, or package formats.
The urgency to shorten the timelines “exacerbates the challenge of doing everything correctly but sooner,” Champion says.
Working With OEMs
That same situation creates opportunities to leverage technology for making inroads in packaging and sustaining growth, revenue, and profit, Champion adds. Meeting those accelerated timelines requires starting off on the right foot by fully documenting the technical specs of the operations needed to achieve the strategic goal.
“Do you give the OEM enough content that allows for correct scope, the correct pricing, and the correct operational goals of that packaging system?” Champion says. “The OEM needs the right specifications so they can design the right solution. Collaborate early and often with OEMs to unlock gaps in your requests and the capabilities of both parties. Deploying automation must solve internal key issues or provide flexibility and savings in operations.”
Successful partnerships with OEMs begin with choosing technology that integrates into the company’s network, says Thomas Morin, president, TC Transcontinental Packaging. The selection process begins by winnowing out any options that don’t communicate with existing machinery.
“What is this system? How does it integrate with ours, not only on site but within the network of machines?” he says.
“Can we integrate the whole production process, from filmmaking to logistics?” Morin asks and then answers. “I don’t think so. There are too many variables. What we can do is improve a process or a couple of processes combined.”
The variables of packaging present speedbumps in the drive toward automation, the experts agree.
Champion’s “roadmap to success” for evaluating the feasibility of capital expenditures confronts the variabilities inherent in four areas—people, product, modes of operation, and logistics and flexibility. Those variabilities then inform the design of the equipment, such as creating a robot sensitive enough to pick up and carton water bottles of varying dimensions.
“Define baseline conditions,” Champion says. “When it goes below or above the baseline, we can do something to bring it back to normality. If we don’t have baseline documented conditions, you find yourself chasing frustration.”
OEMs need to understand the goals of the requesting company, Champion says. That includes asking the right questions, in methodical fashion, about the potential for changing or switching out the equipment in the foreseeable future, whether according to a long-term plan or pivoting to capitalize on consumer trends.
“If you want to be a real partner with a food and beverage company, having that conversation will differentiate you from someone just selling a robot,” Champion says. “Finally, enabling AI and digital technology adds tangible value by reducing cost and improving efficiency.”
Deciding where and how to automate forces companies to heighten their attention to documenting and tracing operations, Morin agrees.
“The machine is not there to judge,” he says. “It does what it is programmed for. It doesn’t decide whether to go right or left. We have to make sure this is fully documented to say whether it goes right or left. That’s part of the infancy of the industry we’re in. It’s not fully processed, so there is still some work to be done.”
Growing Into Automation
TC Transcontinental operates in the flexible packaging and newspaper publishing fields. The newspaper side, which is well established across decades of operations, is highly automated.
“When you have a stable base to work with, then you can start to plan the long-term end and reverse engineer so that automation is feasible,” Morin says.
The packaging side is mostly automated on the back end, and, sometimes, palletizing, he says. Constant innovations in printing and converting technologies, as well as customers demanding ever-higher standards of recyclability and convenience, heighten the risk of investments in automation.
“We don’t have a fully standard base and process that we know will be the same for the next five years yet,” Morin says.
Automation doesn’t necessarily bring cost and efficiency improvements, but everything is changing “as we speak,” Morin says. Finding labor has become even more difficult post-pandemic. That situation raises the question, “Can we use the labor we have and train them and replace what they do by automation, so we do a better job with what we have?” It’s a matter, he says, of “repositioning the labor to where the value is.”
As the PMMI automation report notes, below-average skill levels are hindering the adoption of automated processes. Deloitte points out that manufacturers face a labor shortage of 2.5 million positions through 2030. Many CPGs believe that simplifying the skill sets needed to operate automated machines and processes could help alleviate the labor squeeze.
Champion envisions “hybrid models” where existing facilities are adapted with new automated features or operate in conjunction with fully robotic lines.
Propelling Growth
Automation is rising as OEMs seek opportunity among mid-sized and emerging companies, Reynolds says. Small and medium enterprises are 56% automated, according to the PMMI report.
In smaller operations, automation success could require accommodating lower sophistication levels—perhaps operators don’t have the skill sets needed yet—by introducing lower-speed, lower-tech machines, such as semi-automated systems that require more human intervention, Reynolds says.
“Companies have to grow into these machines,” he says. “Particularly in flexible materials, we’re seeing the need for these machines to be extremely flexible so a company can start at 50 units a minute and be able to grow into these machines for 20 years to come. That capital outlay isn’t only for their current throughput. There needs to be flexibility in the machine to be able to scale.”
Many OEMs are building modularity into their systems, allowing CPGs and packagers to ease automation into their operations, Reynolds says.
The trend toward modularity in food and beverage packaging predates the pandemic, Champion says. “It gives you the agility to test and try with less of an investment in initial costs,” he says. “You can put the puzzle together using different pieces of automation. Automation for growth cannot be a siloed approach. Rather, it’s a landscape view of the industry and customer needs. OEMs and their customers must collaborate in a different, innovative way—breaking traditional barriers.”
With acquisitions that grew TC Transcontinental exponentially, Morin says, his company is “growing and simplifying at the same time.” The company is scrutinizing its 27 sites, dedicating some to specific market segments for the “simplification” part of the equation. That streamlining process opens the door for standardization and automation “with much better payback.”
SKU proliferation parallels the rise of variability in products, such as the tube of toothpaste that comes in multiple versions and packaging types, Reynolds says. That variety “requires a lot of flexibility out of packaging machinery,” he says. With automation, mid-sized and emerging companies enhance their flexibility to “turn on a dime if they plan on introducing a new pack format or new SKU.”
Streamlining Operations
As the PMMI report notes, automation can help solve labor shortages. Artificial intelligence and machine learning can provide the “brains” that optimize and streamline operations automatically through the analysis of production data.
But in so-called “lights out” operations, where few people are needed on the shop floor, “there are multiple people with several master’s degrees in engineering to make sure this is all operating without a hitch,” Reynolds says. “There still needs to be human-scale input, and you’re fishing in a different pond for labor.”
At some point, AI could replace the highly skilled people, Reynolds says. For now, data collected on machine operations can streamline maintenance and reduce downtime by anticipating breakdowns and predicting maintenance needs.
Data also can shave seconds off runs for continuous improvement, Reynolds adds. OEMs can help with remote monitoring or access to collect and analyze the data, but IT departments might object strongly to releasing data to outside entities. This creates a particular challenge for the mid-sized companies that can’t afford to employ their own “heavily degreed engineers” to devise solutions that bridge the gap.
Smaller companies need to bring the IT manager on board to use some protocols that are highly secure to let the OEM help in siphoning off this data and using it in constructive ways, Reynolds says.
With automation, machines communicate across functions, such as from printer to laminator, and across systems in order to allow the analysis of performance, waste, and downtimes, Morin says. They speak to each other, to networks, and to suppliers as they facilitate in-the-moment problem-solving. “Eighty or 90% of the technical issues we face can be addressed remotely by our suppliers,” Morin says.
Labor shortages and post-pandemic trends separating workers from workplaces “could mean that every company—not just the largest but the smallest, too—are drawn to automation,” Reynolds says.
In the meantime, two key challenges of automation also present opportunities for problem solving, Morin says.
“The first thing is that we need to be cost efficient to move forward and keep on improving on our costs,” he says. “The second thing is capacity—being in a position to grow and do more—because the demand is going up. Automation could be an answer to both.”
M. Diane McCormick is a freelance writer and editor based in Harrisburg, Pennsylvania.