How to Calculate Automation ROI — The Right Way, Ep #31
Lights Out: Technology and Automation Podcast by MakingChips
Release Date: 12/26/2025
Lights Out at 20: Inside a One-Man, Multi-Axis Machine Shop with Michael King, Ep #33
Lights Out: Technology and Automation Podcast by MakingChips
What does the future of manufacturing look like when it’s built by someone who has never known a world without digital tools, automation, or on-demand learning? In this episode of Lights Out, the hosts sit down with Michael King, founder of Munkworks, whose story feels almost implausible until you hear it unfold. Michael bought his first CNC machine as a teenager, owns a five-axis machining center before he’s old enough to legally drink, and runs a growing shop almost entirely on his own. But this conversation isn’t about novelty. It’s about mindset. From early hands-on building and 3D...
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From ROI to Reality — Measuring Success After You Automate, Ep #32
Lights Out: Technology and Automation Podcast by MakingChips
Automation doesn’t end when the system is powered on. In fact, that’s often where the real work begins. In the third and final episode of this Lights Out series, the conversation shifts from planning and justification to execution, measurement, and long-term performance. After covering market forces driving automation adoption and breaking down ROI math in the first two episodes, this installment tackles the question many shop owners wrestle with once automation is live: Is this actually working? Dave Vuyk and Eric Nekich dig into how to validate performance, track meaningful metrics, and...
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How to Calculate Automation ROI — The Right Way, Ep #31
Lights Out: Technology and Automation Podcast by MakingChips
Automation is exploding across the manufacturing world, but the real differentiator isn’t the robot, pallet pool, or software you buy—it’s whether you know how to calculate ROI the right way. In this episode of Lights Out, we break down the financial side of automation in plain language so every shop owner, operator, and leader can make smarter investment decisions with confidence. This is the follow-up to our baseline episode, where we had listeners identify their current spindle utilization, setup times, labor load, and cost per part. Now we take the next step: turning...
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The Automation Adoption Boom: Why ROI is the 2026 Metric That Matters, Ep #30
Lights Out: Technology and Automation Podcast by MakingChips
Before a shop can automate confidently, it has to understand one thing clearly: ROI drives every great automation decision. In this episode of Lights Out, David Vuyk and Eric Nekich kick off a multi-part series on Automation ROI—focusing not on hype or shiny tech, but on the real metrics and methods that determine whether automation will pay off or become an expensive paperweight. With “Jolly St. Nick Goellner” out preparing for the holiday season, David and Eric take the mic to break down a critical truth: you cannot automate an unreliable process, and far too many shops are buying...
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Facing the Future: Automation Truths from 40 Years on the Shop Floor with Mike Gamache, Ep #29
Lights Out: Technology and Automation Podcast by MakingChips
As we dive into this episode of Lights Out, we sit down with someone who’s seen automation evolve from pencil drawings and flame-cut templates to fully integrated robotic systems: our friend and longtime industry leader, Mike Gamache. For decades, Mike has lived at the intersection of machining, fabrication, automation, and continuous improvement, and we couldn’t be more excited to bring his experience to our listeners. We reflect on how we first met Mike—a mix of Germany trips, delayed flights, Delta drink tickets, and a little tough love that eventually turned into friendship and...
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From SWAT to Spindles: How Johnny Goode Led MSP Manufacturing’s Lights-Out Transformation, Ep #28
Lights Out: Technology and Automation Podcast by MakingChips
What do law enforcement, SWAT operations, and CNC machining have in common? More than you’d think. In this episode of Lights Out, hosts Nick Goellner, Eric Nekich, and Dave Vuyk welcome Johnny Goode, President and Co-owner of MSP Manufacturing in Bloomington, Indiana—a precision aerospace manufacturer that’s rapidly transforming its operations with automation and digital processes. Johnny’s journey is anything but typical. From police officer and SWAT team member to Army National Guard sergeant, his story is packed with grit, discipline, and leadership under pressure....
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The Real Takeaways from EMO: Monitoring, AI, and the Changing Face of Automation, Ep #27
Lights Out: Technology and Automation Podcast by MakingChips
In this episode of Lights Out, we debrief from one of the largest manufacturing technology shows in the world—EMO Hannover. From automation and adaptive controls to AI-driven machining and the evolving economics of shop ownership, the team unpacks what’s really changing in manufacturing and what’s just noise. As the hosts reflect on trends like the shift from horizontal to 5-axis machining centers, the rise of machine monitoring and IoT integrations, and the reality of underused OEM technology, they dig into what these patterns mean for modern shops aiming to run smarter—not...
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Coached—Not Just Monitored: How the Best Shops Turn Data into Action, Ep #26
Lights Out: Technology and Automation Podcast by MakingChips
You can collect data all day—but if you’re not using it to coach your team, you’re missing the point. In this episode of Lights Out, hosts Nick Goellner and Dave Vuyk wrap up their “Mindset Shifts for Lights Out Legends” series with one final transformation: moving from a monitored shop to a coached one. Drawing on lessons from Nick’s recent talk at the Automated Shop Conference, the hosts unpack how to turn dashboards into decisions and metrics into motivation. They explain why dashboards don’t make chips, how to turn OEE...
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Adaptive Over Aggressive: Redefining Lights-Out Manufacturing with Camoren Schley, Ep #25
Lights Out: Technology and Automation Podcast by MakingChips
Lights-out manufacturing isn’t just about adding robots or running machines overnight — it’s about creating a culture and a system where your shop can perform at its peak without constant human intervention. In this episode of Lights Out, hosts Nick Goellner, Eric Nekich, and David Vuyk sit down with innovator and entrepreneur Camoren Schley of Slytek to explore the technologies and mindsets making true lights-out operations possible. Camoren’s story begins in his grandfather’s Denver manufacturing shop and evolves into a journey of building and selling high-pressure...
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From Fixed to Mixed: Mindset Shifts That Power Lights-Out Manufacturing, Ep #24
Lights Out: Technology and Automation Podcast by MakingChips
In this episode of Lights Out, Nick Goellner, Eric Nekich, and Dave Vuyk take listeners inside the mindset shifts powering the next wave of lights-out manufacturing. Forget just “working harder” — this conversation is about working smarter, breaking out of fixed thinking, and unlocking massive gains without adding headcount or square footage. The trio opens by sharing the personal routines and disciplines that keep them at peak performance, then pivots to the real topic: transforming machine shops from fixed to mixed mindsets. By rethinking workholding, machine real estate, and...
info_outlineAutomation is exploding across the manufacturing world, but the real differentiator isn’t the robot, pallet pool, or software you buy—it’s whether you know how to calculate ROI the right way. In this episode of Lights Out, we break down the financial side of automation in plain language so every shop owner, operator, and leader can make smarter investment decisions with confidence.
This is the follow-up to our baseline episode, where we had listeners identify their current spindle utilization, setup times, labor load, and cost per part. Now we take the next step: turning those numbers into an ROI model that actually reflects how automation performs on the shop floor. Instead of guesswork, gut instinct, or “we tried that once,” we show you how to quantify annual savings, increased capacity, reduced scrap, payback period, and more.
We simplify the math in a way that works for high-mix job shops, multi-shift production cells, and every workflow in between. Whether you’re evaluating a robotic tending system, a pallet pool, high-density workholding, or a Cobot, understanding the financial impact of your decision is the foundation for long-term, scalable automation success.
With real scenarios, honest discussion, and a few holiday-season laughs (including Nick’s mysterious disappearance), this episode gives you the practical tools you need to approach automation with clarity—not confusion. If you want to make 2026 your most efficient year yet, start by calculating ROI the right way
You will want to hear this episode if you are interested in...
- (0:23) How ProShop ERP delivered rapid ROI in Mike Payne’s shop
- (2:49) Today’s focus on ROI and key metrics
- (4:15) Review of required baseline data including utilization, setup time, labor load, and cost per part
- (6:32) Breakdown of the simple ROI formula and the more detailed expanded formula
- (8:53) ROI Example: Labor savings, increased spindle hours, and scrap reduction
- (12:39) Method for calculating labor savings using remaining labor percentage
- (13:45) Why you should use Hire MFG Leaders for your next hire
- (14:16) Converting increased machine utilization into measurable financial value
- (15:02) Impact of pallet pools and high-density workholding on cutting setup and changeover time
- (16:49) Importance of including maintenance, programming, and depreciation in ROI models
- (19:38) Role of adaptive feed-rate controls in improving uptime and process reliability
- (21:57) ROI scenarios for robotic tending cells and five-axis pallet pool systems
- (24:18) Value of redeploying skilled operators to higher-impact work as part of automation ROI
- (25:16) When Cobots are an appropriate automation choice and when integrators are necessary
- (27:18) Key homework steps: running a basic ROI estimate and identifying utilization gaps
- (29:32) Why you need to check out the SMW Autoblok catalog
Resources & People Mentioned
- How ProShop ERP delivered rapid ROI in Mike Payne’s shop
- Why you should use Hire MFG Leaders for your next hire
- Why you need to check out the SMW Autoblok catalog
The Core ROI Formula for Automation
Simple version:
ROI (%) = (Annual Savings – Annual Costs) ÷ Investment × 100
Expanded version for manufacturing:
ROI = [(Labor Savings + Increased Machine Utilization + Scrap Reduction + Overtime Avoided) – Maintenance & Depreciation] ÷ Capital Cost
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