Is Turnkey Automation Right for You?

Or is there a better way to deliver your automation project?

These days its seems every automation integrator is offering turnkey solutions. It’s front and center on the web site and brochure. The term conjures an image of hopping into a brand new car and speeding away from the dealership. If only custom automation solutions could really be that simple. In fact, a collaborative approach may be a better way to deliver your automation project.

 

What is turnkey automation?

The term turnkey implies that, upon delivery, all a customer needs to do is turn a key and the machine will be fully operational. The idea is to build a custom machine that offers all the benefits of an off the shelf solution. A turnkey project will be delivered at a fixed cost, a specified time, and meeting all customer requirements. Most turnkey solutions even come with a warranty.

A company usually decides to purchase a turnkey solution to (1) minimize risk and (2) expend the minimum amount of internal resources and attention. In theory, the turnkey contractor is then incentivized to make the project profitable by beating their cost and delivery time estimates.

The “Change Order Dance”

Specifying good acceptance criteria is tricky. The brunt of that work falls on the customer. Most customers don’t have the time or the experience required to put together a truly comprehensive specification document before starting a project. Often, small but necessary changes result in what we call the “change order dance.” This is when the contractor charges a fee to cover a part or function not originally specified by the customer. In addition to this new item, the contractor may structure the fee to recover losses on another aspect of the project. The customer must choose between accepting an inadequate solution or paying the fee. Often the customer accepts an imperfect solution because a contractor has met the letter, but perhaps not the intent, of what was specified.

For example, let’s say you – the customer – specified that your engineering team needs to be able to control the speed of an electric motor on a new turnkey machine. You’ve stated in the written spec only qualified engineers should be able to make the adjustment, not the operators. The contractor tells you, “The speed of the motor can be controlled with the Variable Frequency Drive (VFD) in the 480V power cabinet.”

What?! You wanted control on the Human-Machine Interface (HMI) screen. That’s where all the other controls are. It’s dangerous to go in the 480V cabinet every time you need to make a small change. It’s obvious what you meant, right?

Now imagine the contractor’s perspective. They are over budget from trying to satisfy dozens of requests like this, all stemming from an ambiguously worded spec. Your company’s management has denied requests for more capital, citing the contract. The contractor figures it will cost them $10k to fix the control, but they are already $10k overbudget. You get a change order for at least $20k.  Knowing they are the only ones who can meet the deadline, what do you do?

The Collaborative Approach

A project management approach that eliminates the “change order dance” has already been developed. The software industry created Agile methodology to better manage highly technical projects. Many Agile strategies are also useful for mechanical engineering projects.

The most helpful Agile tenant we can repurpose is to value collaboration over contracts. A continued and open relationship between the contractor and the customer fosters better outcomes for both. The customer and the contractor bring different expertise and experience to the project. It makes sense for them to share.

To shift from a contract mindset to a collaboration mindset,  helps to accept that a project’s true costs can only become clearer as the project advances. Therefore, the project needs to progress iteratively, hitting milestones then revisiting the specifications and resources for the next step. The customer and contractor must communicate openly about the progression of the project.  The payback for the extra work of collaborating? A better solution, delivered more quickly, and with less expense.

Conclusion: What’s best for my project? Turkey or Collaborative?

Turnkey automation is a popular phrase, but that doesn’t make it the best way to deliver your automation project. Mackenzie Design prefers to execute projects collaboratively because it delivers better solutions, more quickly, and with less expense for our customers. Consider a collaborative approach for your next project with Mackenzie Design.

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