Factory Workforce Reduction: Explaining the Challenges and Solutions in Achieving Automation within Factories

Factory Workforce Reduction: Explaining the Challenges and Solutions in Achieving Automation within Factories
Against the backdrop of labor shortages and rising labor costs, factories are finding it increasingly difficult to secure manpower. Hence, workforce reduction within factories becomes crucial. To advance this reduction, it is necessary to identify inefficiencies in existing operations and automate production processes through the introduction of state-of-the-art equipment. This article explores the reasons why automation within factories is necessary and discusses the automation of conveying processes as a means to achieve workforce reduction.

What is Factory Workforce Reduction?

Factory workforce reduction refers to the process of reviewing and eliminating unnecessary steps in production or assembly processes, thereby reducing the number of workers required per operation. While simply streamlining workflows to enhance efficiency and reduce personnel is one approach, it is more commonly achieved through mechanization or the introduction of computers. With the recent advancements in digital technologies such as AI, there is a growing trend towards automation of more complex tasks, facilitating further progress in workforce reduction.

The difference between workforce reduction and labor-saving

There is a concept similar to workforce reduction called 'labor-saving' . Labor-saving refers to initiatives aimed at reducing the workload of workers by eliminating waste in tasks or introducing machinery. While both workforce reduction and labor-saving are methods to streamline operations and increase productivity, they differ in their ability to reduce the number of workers in a given process. Even if labor-saving reduces the workload per person by 10%, it cannot be considered workforce reduction unless it leads to a reduction in personnel. In other words, labor-saving focuses on reducing the burden of work without necessarily intending to reduce personnel, whereas workforce reduction prioritizes reducing personnel.

The reasons why workforce reduction in factories is necessary are as follows

The pursuit of workforce reduction in factories has been ongoing in many industries for a long time. However, in recent years, it has become increasingly demanded due to the following reasons

Addressing Labor Shortages

Due to the declining labor force caused by the aging population, labor shortages have become increasingly severe across various industries in Japan. This trend is expected to accelerate further in the future, making the promotion of labor-saving measures indispensable for sustaining and growing businesses in circumstances where it's challenging to attract workers even through job postings.

For tips on addressing labor shortages in manufacturing and logistics settings, please refer to the following article.

Rising Labor Costs

Against the backdrop of labor shortages, competition among companies for talent acquisition has intensified, leading to a steep rise in labor costs. In recent years, minimum wages have been raised nationwide, further driving up labor costs. In fact, in 2023, the national average minimum wage exceeded 1,000 yen for the first time (*). Particularly in regions experiencing significant population outflow, the increase in minimum wages has been substantial, unavoidably burdening companies with higher labor costs.

Additionally, skilled labor often requires time-consuming training, making it prone to shortages and further inflating labor costs. Consequently, there is an even greater demand for automation to mitigate the burden of labor costs.

Improvement of productivity

To promote automation, it is essential to enhance productivity through the introduction of new production equipment such as machinery and robots. Automating tasks previously performed by human labor accelerates production processes significantly, enabling higher production with fewer personnel. Machinery operates continuously until reaching its service life, offering the potential for medium to long-term workforce reduction.

The risk of skilled staff retiring

Dependence on skilled staff with advanced skills poses a risk when they retire, as their departure can disrupt production processes. In recent years, addressing the challenges of aging staff and transferring technical skills to younger generations has become crucial. To tackle this issue, many companies are turning to automation and mechanization for workforce reduction.

The process of promoting workforce reduction in factories follows these steps

The process of workforce reduction in factories typically follows the steps outlined below

Analysis and review of existing tasks

Firstly, a detailed analysis of the existing production process is conducted to identify areas where inefficiencies occur and which processes require significant manpower. Processes that demand high precision can also be candidates for automation to reduce errors, thus becoming targets for workforce reduction. It's crucial to break down each process into smaller components, identify inefficient tasks, and outline improvement strategies.

Standardization of tasks

After identifying inefficient processes and reducing waste through workflow optimization, the next step is to standardize the tasks. In processes performed by human labor, there may be significant variations in efficiency due to differences in methods and skill levels among workers.
To address this, each worker's tasks are analyzed to determine the best methods, which are then documented in manuals to ensure that everyone can perform the tasks at the same level. This standardization enhances workflow efficiency and contributes to workforce reduction.

The automation through the introduction of state-of-the-art technology and equipment

For companies that have already repeatedly conducted activities such as identifying inefficiencies and standardizing processes while maintaining existing facilities, there may be cases where further improvements are not possible.

In such cases, automation through the introduction of the latest technology and equipment can be effective. There are various equipment and solutions available, such as robots, conveyors, sensors, and control systems, and it is necessary to select the ones that are needed. Particularly, many companies have yet to address the automation of transportation processes.

Automation of Conveyance to Address Workforce Reduction in Factories

In many factories, there are conveyance processes, and automating these processes can achieve significant workforce reduction.

Automation of inter-process conveyance.

In factories, there is a need to convey parts, materials, work-in-progress items, etc., between various processes and stages. Relying on manual labor for these conveying tasks can impose a significant burden on workers and require a large workforce, hence automation for workforce reduction is sought to improve productivity and address labor shortages. Therefore, the introduction of conveying robots such as AGVs (Automatic Guided Vehicles) and AMRs (Autonomous Mobile Robots) proves effective.

For more information on the benefits of implementing AGVs and AMRs in factories, as well as key points to consider during implementation, please refer to the following article.

Automation of Intra-facility Logistics

Automation of intra-facility logistics involves utilizing robots and systems to automate processes such as loading and unloading, inspection, storage, picking, and inter-process transport that were previously done manually. In addition to AGVs and AMRs mentioned earlier, there are various solutions available such as digital picking systems for efficient picking and palletizers for automating palletization. Advancing the automation of intra-facility logistics enables cost reduction through workforce reduction and productivity enhancement. For more information on solutions and challenges related to logistics automation, please refer to the following article.

If you aim to achieve workforce reduction in conveying operations, consider LOGITO.

At Daiichi Jitsugyo, we offer the LOGITO solution service aimed at automating logistics for companies in manufacturing and warehousing industries. We provide comprehensive support from on-site analysis in factories to coordinating equipment and facilities, as well as after-sales service. Through collaboration with domestic and international group companies, we deliver rapid and optimal solutions, effectively achieving workforce reduction in conveying operations within factories.

Case Studies of Factory Workforce Reduction

At one factory, over 400 types of parts are delivered daily in returnable containers, which are then sorted and returned to the supplier after the parts are issued to the production line. The sorting process for these empty containers was done manually, requiring significant effort, especially on peak days when up to 30,000 empty containers needed to be sorted by a team of 10 people daily. To address this, the factory introduced automated warehouses, AGVs, and palletizing robots, achieving workforce reduction. As a result, the required workforce for the task was reduced from 10 to 3 people.

In the following document, detailed explanations on how to achieve logistics automation and other related topics are provided. If you are interested, please take a look.