Justifying new technology is a multi-step process that requires a thorough assessment of a number of factors at work in your manufacturing operation.

1. Understand your costs.
Use a transparent costing system
Evaluate all cost factors
Evaluate the influence of new technology on the cash flow
Calculate production cost and evaluate the influence of investment of new technology on production cost and return on investment

2. Understand potential benefits of CNC technology; measurable benefits.
Productivity
Reduced setup and tool change time
Improved uptime
Throughput
Scrap rate
Tooling cost
Maintenance cost
Job preparation cost
There are also intangible benefits that may not be calculable, but can have a major effect on your machining success—including quality, accuracy and surface finish, which should not depend on operator skill and should not require constant checking; and, preset quick change tooling with standardized inserts that save production time (up to 15 percent or more compared to setting the tools on the machine so the machine is productive for a greater part of the shift).

3. Understand the costs of older equipment.
• Lower efficiencies
• Longer than planned setup times
• Requires vanishing skills to set up and operate
• Requires tweaking to successfully run good parts—only a few setup/operators in your company have this ability
• Incapable of today’s quality requirements
• Cannot statistically hold tolerances
• Produces excessive scrap parts, hurting efficiency, adding to material cost
• Frequent unplanned downtime for repairs
• In-house maintenance personnel (overhead)