Maximizing Return on Investment from Automation: Top Success Criteria
Enterprises across every industry and geography are trying to comprehend the potential of automation and ways to optimize the various automation solutions to generate ROI for their business. Despite the increasing frenzy to invest in automation, many enterprises are struggling to deliver ROI on their automation projects. In fact, according to a recent report, 30-50% of initial automation projects fail.
Many enterprises succumb to the hype of embracing automation in every function of their business, even before fully assessing how these technologies will fit in their environment, leading to compromising process efficiencies and limiting ROI. Irrespective of the industry they operate in and the types of customers they serve, the challenge of managing process flows efficiently across diverse platforms is universal. According to a recent research, silos eat up a huge number of resources, leave numerous manual steps scattered throughout the operations and has a huge negative impact on efficiency. Legacy environments tend to be highly customized and inflexible and prove to be very slow to adapt to rapid changes.
ROI must be considered in the context of total returns from automation technologies and the total cost of ownership (TCO). The total cost of ownership of automation technologies consists of implementation costs, maintenance costs and supporting costs. These components must be better understood to maximize ROI on automation technologies.
Implementation Costs involve expenditure related to preparation, installation and deployment of automation solutions which can include opex related costs such as development, configuration, testing etc and capex related costs such as licensing and infrastructure costs.
Maintenance Costs involve costs related to the subsistence of automation technologies including ongoing yearly maintenance renewals, cost of labour for maintaining and supporting software and infrastructure.
Supporting Costs involve training and change management costs for technical and business resources to help them efficiently use and adopt automation technologies.
For example, the total cost of ownership for technologies like Robotic Process Automation will include expenses associated with identifying processes for automation and assessing the degree of automation required based on the complexity of the processes. Based on the requirement analysis the design then follows, where process definition documents are translated to developers and solution architects to develop the most optimal automation of such processes. Additionally, the build costs of the process library of routines stored as scripts must be included. Although the expense for building the RPA scripts is not huge initially, it increases progressively as an enterprises scale automation and also need to maintain these to suit any changed underlying landscapes. Different functions, such as HR, Finance, and Operations, need to deploy their own RPA scripts to drive efficiencies as a team.
Organizational preparedness can drive agility, scale, and success in implementing automation and a lack of enterprise readiness can delay planned benefits as well as lead to increased costs. Let us look at the top four success criteria for maximizing ROI from automation.
One of the key benefits of automation is the reduction of human effort hence organizations should look to automate processes based on factors such as volume, frequency, repeatability, complexity, nature of input data and potential levels of standardization. Enterprises must assess processes based on scope, size, cost of automation and potential benefits of automation. The order of priority of processes for automation can then be identified and agreed upon based on these parameters. A detailed prioritization of processes can lead to greater levels of commitment to the process selected for automation and higher returns on the automation investment. It may be important to consider elements such as setting up a proper governance and authorization framework ably supported by tools and templates that can eventually make the process selection smoother when considered at scale.
Alignment with Strategic Objectives
Enterprises must focus on internal training and enablement coupled with consistent and positive messaging around automation to support in building a culture that encourages its employees to accept and work in tandem with their digital counterparts without any resistance. The role of the leadership team, human resources teams and respective functional heads is critical at this point, as they continue to encourage and reward teams that are enabling this change take place faster. Here are the essential steps in establishing that culture.
Support from Key Stakeholders: To be successful, any kind of automation must have adoption and support right from the executive level. Key stakeholders should be engaged from the initial stage assuring commitment and support. They should see automation as a strategic and transformative business project and provide the required financial and human resources.
IT Involvement: The IT team’s involvement in the evaluation of platforms and tools and providing the right infrastructure for automation is imperative for a successful automation deployment. IT departments should be engaged early on, in the automation process and should be a critical stakeholder to ensure effective change management including communicating the vision and impact of such automation.
Removing automation resistance in your business teams: There are a lot of myths and fallacies surrounding the goals and capabilities of automation. Therefore, it is important to underline to business teams how automation will enhance existing operations and transform business in general. With the right and consistent messaging, the business departments will begin to understand why there is no need for resistance around automation and how it is here to make their lives better by engaging them in more value-added tasks in the business instead of replacing them.
Choosing the Right Platform:
A guiding principle for the evaluation of the right automation solution is that the solution should not only execute repetitive, high frequency, high volume tasks but it should also be capable of rapid implementation and seamless integration with other systems and applications with minimal organizational disruption. Some of the selection criteria includes:
Extensive Features: The right automation platform should have inbuilt features that can speed up the editing and configuration process, while keeping it simple. Enterprises should look for an automation solution with features such as built-in extendable commands, wizards and GUIs; and one that supports extensible or add-on features. Other factors to consider while choosing a solution a flexibility, wide scope, and easy and seamless availability.
Seamless Usability: The chosen tool should be easy to work on, flexible enough to accommodate basic automation processes, require less training, can be controlled easily, and should be user friendly. Users should be able to graphically create process automation with a toolset that works with seamless integration.
Easy Scalability: Enterprises should look for a product that can easily scale up and down based on the requirement. One aspect of easy scalability is also the scale of ecosystem partnerships that are available to be immediately leveraged either as assets that could be ready to deploy for specific use cases or to deliver automation with a quick turnaround.
Training: Good automation solutions should come with a broad choice of and community- based training options including computer-based (e.g., webinars, one-on-one demos, videos) training, classroom training and online documentation (e.g. tutorials, best practices, release notes, testing guides).
Building the Right Team for Automation:
The core team should comprise of stakeholders from cross functional units who come together to execute the governance framework and be responsible to deliver timely automation. This could also come in the form of a centre of excellence comprising of dedicated and shared resources from various functional units as well as third party organizations.
- Subject Matter Experts and Process Owners who have an in-depth understanding of the automated business process.
- Automation team that includes developers and data Analysts responsible for the project implementation and deployment.
- IT and Information Security team to provide guidance on how automation interfaces with the existing technology.
- Infrastructure support staff responsible for running the servers and machines that an automation project requires.
The benefits of automation are far-reaching and though automation could be time taking and expensive, the payoffs are far greater. As many enterprises have keen interest to reduce costs and enable resilience, automation when done right, accelerates the pace to achieve these objectives.