The exosuit experiment: Assessing returns from technology investments

As pressure for innovation increases, organizations are feeling equal pressure to evaluate those innovations before committing to major projects with a high cost in effort and capital. I can speak firsthand to the challenge: no one wants to miss out on potential benefits from new technology, but we can’t constantly burn resources and the focus of our teams on major changes, especially if they don’t pan out.

I’ve learned to look for technologies with multiple potential benefits (including sources of ROI). This increases the odds of seeing real benefits and gives me confidence that the results from small tests will turn into broader rollouts with positive results.

For a growing number of companies, one such multi-pronged ROI technology is exoskeletons. Exoskeletons are a type of assistive technology developed with the goal of improving the physical capacity of users. While this technology may seem relatively new, the idea of assistive wearable devices goes back more than 150 years.

Since then, many variations have been introduced to the market. Exoskeletons can be categorized three ways, by looking at body parts or type of movements they assist, the source of assistance (either batteries and motors or elastics and springs) and the nature of the frame and structure (either rigid or soft and textile-based).

As more and more organizations consider implementing these technologies for their workers, the need to understand the potential ROI of the assistive technology has also increased.

ROI calculator

Understanding what products are worth the investment is key to efficient operations. By establishing the ROI of a technology, an organization can ensure it’s investing in an effective product that will consistently deliver results. A Deloitte study indicated that 86 per cent of surveyed manufacturing executives believe smart factory solutions will be the primary drivers of competitiveness in the next five years.

These results indicate a wave of technological changes in the manufacturing industry, requiring executives to be extremely decisive when selecting new products to implement. Being able to determine the ROI of these technologies could make these difficult decisions a lot easier. That is why our team created an ROI calculator for evaluating potential return on exosuits.

Factors to consider

Establishing the ROI of manufacturing technology requires a tailored approach depending on the aspects of business that the innovation affects. The basic formula for calculating ROI is (net benefits – costs) costs x 100 per cent, however, this is a very high-level approach and isn’t applicable for all types of manufacturing innovations. When determining the ROI of assistive technology, there are three main factors to consider, including the product’s effect on productivity, reduction of injury risk and effect on turnover.

Effect on productivity

In manufacturing, even small savings can make a big impact. When a technology can improve worker productivity, it lowers the cost per unit of work.

How can you determine if assistive technology has an effect on productivity? Our team did a study for an international grocery retailer by evaluating the average number of cases picked per hour before, during and after implementation of an exosuit.

Tracking these numbers gives you long-term insights into how the employees are adapting to the assistive technology. It can also show you how effective implementation was and how long the process took.

The exciting detail here is that increasing productivity didn’t come at a cost to either. Employees actually reported an improvement in work-related discomfort and fatigue. This left workers feeling supported by the organization, knowing the company is providing the technology to make their job easier, and leaving them feeling better at the end of their day.

Reduction of injury risk

If a technology can reduce the risk of injury, it can save your organization a lot of money. Workplace injuries cost U.S. businesses $1 billion a week, with overexertion alone costing an estimated $12.84 billion a year. Indirect costs, including training employee replacement costs, implementation of corrective measures, repairs to damaged equipment and lower employee morale, can add to the costs.

Evaluating a technology’s effect on the reduction of injury risk is essential to the overall ROI calculation. Tools such as ExoLiFFT, developed by teams at Auburn and Vanderbilt universities, can help estimate injury reductions expected from exoskeleton implementations based on the tasks being performed.

Effect on turnover

It’s no secret that improving employee retention can decrease organizational costs. To understand how much a new hire could cost, the Manufacturing Institute suggests considering the salary, recruiting and hiring costs, benefits, training and possible overtime costs. This means the overall hiring cost could be three times the actual salary of a team member.

It’s important to keep employees around. Not only should the direct costs be considered, but social effects in the workforce also add indirect costs. One study found worker turnover impedes coordination between assembly line coworkers by weakening knowledge sharing and relationships. By adopting technology that improves worker’s day-to-day experience, employees feel supported and able to do a potentially physically demanding job for longer.

As organizations navigate the landscape of technological innovation, assessing ROI and lowering the risk associated with innovation becomes paramount. Technologies like exoskeletons offer opportunities to enhance productivity, reduce injury risks and improve employee retention.

Implementing an ROI calculator tailored to these factors enables informed decision-making, ensuring that investments yield sustainable benefits. As the manufacturing industry embraces technological advancements, understanding and quantifying the ROI of such innovations will be integral to maintaining competitiveness and driving success.