Do organisations now, more than ever, need to show an ROI from their automation programs? What would you have said?
At last night’s Blue Prism Digital Twins event I was asked a question ‘Do organisations now, more than ever, need to show ROI from their automation programs?’ I gave the answer below but wondered what you would have said?
The short answer is yes.
Different organisations have different business strategies or priorities. For example, some organisations may want to use automation to reduce headcount or overtime bills. Other organisations may have a challenge retaining staff or customers. Currently, some organisations may need to retain their current output but at lower cost.
Whilst different organisations have different goals, one thing remains true no matter what. Automation costs money.
Organisations can achieve a balance score card of benefits from a successful digital and automation program. But, if they don’t recover the cost of their automation program then a CFO is well within her rights to challenge it. This has always been true, but especially now when many organisations are under greater financial pressure than ever.
Figure 1: Example Automation Balance Score Card (not shown last night)
For organisations, headcount that has left the business is a tangible measure, as is a real reduction in P&L budgeted over-time. Improved customer NPS that translates directly into higher customer retention that translates into tangible P&L benefit counts.
Completing the same, or more, work with 95 people, not the 100 who were previously employed, is a real efficiency save too.
Improving staff retention and saving money assigned in the P&L for recruitment, training, rework, additional audit or supervisory staff, spending on industry qualifications, etc. can be a saving too.
The great news from an automation is that more than one benefit can be achieved (e.g. great process compliance or SLAs). But to be recognised as financially successful, an automation programs benefits must be tangible (i.e. the type of financial benefit that appears in the P&L which a CFO will sign off on) and must be realised over the life of your business case. Otherwise, you cannot raise a flag and claim victory.
Author extra advice not spoken to last night: To be recognised as financially successful, an automation programs benefits must be tangible (i.e. the type of financial benefit that appears in the P&L which a CFO will sign off on) and must be realised over the life of your business case.
Figure 2: Example Automation Business Case for Governance Committee
It is paramount that a governance committee and finance agree automation benefits and then track those business benefits endure over time. Too often organisations forget to track benefits and the benefits promised fail to get delivered over the 1, 2, 3 or 5 year promised business plan. Organisations must track benefits diligently (e.g. every quarter or six months). If they find benefits are no longer delivered then remove the bot, take the benefit off the P&L, then complete a retrospective and feed the learning back into your automaton program.
What do you think?
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- 8 questions to ask to ensure you select the ‘right’ processes to automate using RPA | IA.
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