The real cost of business automation? not implement it

As the maturity and opportunities offered by the technology grow, the cost of not adopting automation is increasing, he writes. Rajith Haththotuwegama, Manager of Data Analytics and Automation at Tecala.

Automation technology has long been accepted as having substantial value. Five years ago, McKinsey & Company reported that a review of 16 case studies found a return-on-investment range of “30 to as high as 200 percent in the first few years” for automation technology.

The financial savings were just the tip: Organizations that embraced automation also saw improvements in customer and employee experience that multiplied the overall value they received from implementing automation.

Rajith Haththotuwegama, Manager, Tecala

To observers, these automation projects seemed incredibly worthwhile, but at the time, they could also be quite expensive to run. The initial cost of the software was high, and customers needed to fully configure the software to perform tasks in an automated manner. The skills required to do this in-house were not widely available and therefore also expensive. These barriers undoubtedly held back the scope and potential benefits of automation.

In the five years since then, much has changed. Automation software can now be consumed as a service, and access to skilled people has greatly improved. The cost of automation projects is drastically reduced and is now within the reach of even mid-market organizations, not just large ones.

As more organizations embrace automation and realize benefits and cost savings, FOMO (fear of missing out) grows.

cost inaction

Since the cost of implementing automation is no longer the key issue facing users, attention has shifted to another set of “costs”: the cost of not implementing automation. These costs can be substantial and should not be underestimated. They could rob organizations of happy, talented people, future growth opportunities, and competitive advantage.

In my opinion, the costs of not implementing automation fall into two broad categories: people and growth. Both are inextricably linked.

First, organizations that do not automate will find it difficult to keep their employees happy and engaged. People want to be doing meaningful work. They want to spend their time focused on the most important, valuable, and higher-order aspects of their role.

The repetitive, slow, or boring aspects of your role are ripe for automation, and people increasingly know and want this automated support. This could come in the form of a virtual co-worker that can be recruited to handle tasks like the necessary, but mundane, preparation of month-end reports.

People stuck with automatable tasks may also feel like they have limited opportunities for career advancement. They may not have time to learn new skills or brush up on existing ones. However, if some of their workload were to be automated, it would free up valuable time that they could reinvest in upskilling or devising and pursuing new high-value projects for their employer.

The cost to companies of keeping people doing automatable jobs is increasingly disenfranchisement. The employee is disengaged, or worse, sees other employers who are more forward-thinking in embracing automation and tools and technologies that enhance the employee experience, and they vote with their feet.

This exposes the first organization to substantial recruitment and retraining costs. It can take a year or more for a new employee to catch up. This cost and effort is best avoided in today’s recruiting market, and can be avoided by allowing employees to do their best work most (or ideally, all) of the time.

Other reading: How digital tools can improve the hiring process.

When the execution of the process depends too much on the presence of a single person or the presence of certain people, a dependency on the key person is generated. Such agencies may limit a person’s ability to take leave, whether for leisure or sickness. It makes sense to automate dependencies on key people, so that a systemized backup option is available to the organization, should the need arise.

In summary, some of the people-related costs of not automating include: process disruption, too many dependencies on key people, the real possibility of dissatisfied staff and churn, and incurring substantial recruitment costs. But what are the growth-related costs of not automating?

As organizations grow, they typically add more people, and the relationship between those things is pretty linear. But automation can help an organization scale. Specifically, when automation is used to handle repetitive transaction processing or hard work, it frees up staff to do the things machines aren’t already good at, like customer service and customer relationship management. .

Additionally, organizations may find it possible to do much more with the same size of team. A team of people, backed by a team of virtual co-workers, is becoming more and more common, allowing the organization to scale and onboard more customers, without having to do a lot of new hires.

However, the cost of not automating is that growth is too expensive. Organizations can break that cycle and foster a new growth mindset by using automation to further their goals and ambitions.

To avoid incurring the costs of not implementing automation, organizations that have not yet considered automation, or that have experimented but put their initiatives on hold, should urgently try to restart them as a matter of course.

Underpinned by Intelligent Automation as a Service and backed by deep domain skills, mid-market organizations and their larger cousins ​​now have a great opportunity to succeed with automation initiatives.

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