Unconstrained automation in industrial robotics heralds greater demand for intelligence and an on-shoring boom

Matt Hatton

By Matt Hatton, Founding Partner, Transforma Insights.

Transforma Insights recently published its report on Autonomous Robotic Systems. The industrial robotics segment is the most valuable and most cutting edge, demonstrating the demand for intelligent orchestration and collaboration, and a potentially game-changing impact on manufacturing sector.

In the last couple of years, a lot of attention has turned towards autonomous robotic systems and Transforma Insights recently published a report on the subject. This article provides a brief summary of some of the key findings. The concept of autonomy is relatively well understood, particularly in the context of autonomous vehicles. The Society of Automotive Engineers has a six level scale going from 0 “No Automation” all the way through to 5 “Full Automation”. In this article we will focus rather on other types of robot, to which a similar scale of automation could also equally be applied.

In the chart below we present the Transforma Insights segmentation of the market covering consumer grade through to industrial grade and with a wide variety of profiles in terms of movement, e.g. static industrial robots compared to highly mobile drones. While consumer devices, such as Roombas and lawnmowers dominate volumes, the industrial sector is comfortably the biggest in terms of revenue, accounting for about half of all spend; hardly surprising when factory robots from the likes of Kuka or ABB can easily cost $50,000, compared to consumer devices at only $200. Drones is the other enterprise segment that is substantial today and promises much more in the next 5 years.

Transforma Insights robotic systems segmentation

At Transforma Insights, as part of our Best Practice and Vendor Selection Database we are tracking enterprise deployments of robotic systems, including factory robots, warehouse systems, drones and others. As part of that research we look at dozens of characteristics of hundreds of real-world deployments, including the degree of autonomy, as illustrated below. According to our research, 97% of manipulation robotic systems (i.e. those used predominantly in factories and warehousing) have high or full automation. Compare that with mobile robotic systems (mostly drones), where the degree of automation is much more fragmented.

Transforma Insights chart: degree of autonomy in robotic systems

One interpretation is that the automation of drones continue to be constrained by various factors, including regulation and the need to operate in a public space, whereas manufacturers have been able to embrace automation much more fully, operating as they are in private premises with much more limited movement. The direction of travel for drones is towards greater and greater automation. Unconstrained, adopters of robots seem to massively embrace it.

Furthermore, the increasing adoption of largely unconstrained autonomous robotics within factories promises two things. Firstly we expect to see more on-shoring as the requirement to offshore production to save on labour cost is much reduced given the reduction in labour. The price saving from manufacturing in China, for instance, is much reduced. According to our Forecasts, see below, China will not dominate investment in industrial robotics in the same way that it dominates traditional manufacturing. North America and Europe are equally important, driven by demand for onshoring.

Transforma Insights chart: autonomous robotic systems investments by geography

Secondly, and as a result of being closer to the end user, there are benefits in terms of better responsiveness to local demand or mass customisation of products.

The advent of greater automation has also driven an increasing focus on the importance of management software, and on collaboration and standardisation via initiatives such as the Open Platform Communication Foundation. The industrial robotics sector has shifted from being all about hardware to being much more about software, with the major vendors making a notable shift towards the intelligence layer, and new players such as Bright Machines emerging to focus on the management and orchestration layers. This is yet another example of technology sectors moving from a stove-piped operational technology (OT) approach to one which is much more IT (and therefore interoperable and adaptable) framework.

In the early flurries of movement to adopt industrial robotics, it’s easy to lose sight of the fact that there may, of course, be diminishing returns. The early adopters show very positive results but the broader application to all manufacturing is, perhaps, yet to be proven. It is interesting to note that Elon Musk has spoken about “excessive automation” in some of Tesla’s production, with partially manned production lines offering the necessary flexibility. With improvements in machine vision and machine learning, however, it may be that Tesla just briefly got ahead of the technology.

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