Automation/Advanced Manufacturing Technology/Computer-Based Integrated Technology

Automation usually refers to the replacement of human work by machines. The word was first used by the Ford Motor Company in the 1940s to describe automatic handling and machine-feeding devices in their manufacturing processes. Advanced manufacturing technology (AMT) is a special instance of automation and usually refers to computer-based manufacturing technologies and support systems. Examples include computerized numerically controlled machine tools, computer-aided design, and computer-supported production control systems. There will be few, if any, manufacturing companies in the developed world that have not undertaken some investment in AMT.

Computer-based integrated technology (CIT) refers to higher levels of integration and comprises systems that cut across organizational functions. For example, enterprise resource planning (ERP) systems include a centralized database and sets of integrated software modules designed to manage all aspects of an organization's work processes, including production control, customer billing, and human resources. Estimating the uptake of CIT is difficult. However, a survey in Australia, Japan, and the United Kingdom, published in 2002, found that approximately 33% to 40% of larger manufacturing companies (employing more than 250 people) were significant users of CIT. The same survey in Switzerland reported substantial use in around 60% of companies. The findings are similar for ERP systems. By the late 1990s, it was estimated that around 40% of large U.S. companies and 60% of small ones had deployed ERP systems. By 2004, the worldwide market for ERP systems was estimated to be around $79 billion per annum.

Over the last decade, there has also been growing investment in systems to integrate activities between organizations, a good example being e-business systems that allow electronic ordering and billing through a supply chain and on the part of customers. By the year 2000 it was estimated that around 20% to 25% of companies in the United States, Canada, Europe, and Australia were trading online, although the proportional value of goods traded online was much lower (less than 10%). It is almost certainly the case that these amounts have grown and will continue to grow.