Delivering Operational Efficiency and Sustained Competitive Advantage by Automating Work & Business Processes
The obvious benefit of automation is cost reduction, however there are far more important benefits to be gained by automating work and business processes. You will need to understand in detail the benefits of deploying a work automation solution, typically housed within a BPM (Business Process Management) platform.
We will highlight the major benefits of work automation here, and you may be surprised that cost reduction is bottom of this list (and with good reason).
Organizational Visibility & Measurement
If you can see something, then you can measure it – if you can measure something, then you can improve it. This may be a paraphrased Deming mantra, but automation of work allows for the establishment of viable measurement of input, activity, and output. In turn this generates reliable data on work, and because of the digitized nature of automation, this is available for reporting purposes in near real-time.
More than this, the information which is generated allows for powerful data analysis to be applied, and also underlies the Big Data trend we are experiencing today. Timely reporting in a format managers need, means opportunities can be taken advantage of, and issues such as bottlenecks can be negated that much faster. This helps develop competitive advantage, but also illuminates work throughout the organization, improving global visibility.
Successful work automation decreases the amount of time and resources required to generate a given output. In practical terms, you can do more with less, where “less” means you produce at a faster rate, with fewer people, and fewer resources.
Automation of work is entirely congruent with the principles of Lean and in particular, the elimination of wastes involved in production. Efficiency improvements are achieved by the identical replication of work activities in any particular category, and through automation, manual interaction by humans is minimized which also reduces the introduction of human error.
By eliminating manual interaction and the need for human interaction, we are able to speed up the workflows running through automation. People are not typically good at multi-tasking, and whether we are dealing with a manual labor task or a knowledge worker’s need to exercise judgement, humans are generally linear thinkers and doers.
By automating work and business processes, we can have multiple work activities operating in parallel rather than sequentially. This means we can compress the time it takes to finish a piece of work, and also avoid over-production by reacting to demand for work from other teams and departments (the so called Pull mechanism as espoused by lean).
People are not robots or computers, so you will always see variation introduced whenever they are interacting with a business system. They cannot deliver the same consistency over time of their output, nor can they perform tasks and work to the same time period allotted again and again.
Automation tackles both of these issues, because you have exactly the same work activity replicated within the automated system which is always identical. In addition, because of the identical activities and resource requirements, you are also able to achieve consistency across the organization whenever a business process is initiated.
Finally, we get to cost reductions, but a word of caution here: saving money in the short-term is not a major contributor to long-term ROI. Lean and Six Sigma have both garnered for themselves a poor reputation because of their use for headcount reductions. In turn, this has come to mean for the workers involved that their jobs are on the line, and these tools are simply being used to justify implementation of mass layoffs and firings.
Practically, cost reductions are achieved by successful work automation, but you must also be aware of the opportunity costs involved, such as the loss of institutional knowledge and skills you the organization may need in the future. That said, there are other cost saving factors beyond simple headcount reduction, such as the cost associated with the elimination of waste, increased throughput of production, and reduction of resources required to generate product.