Recently, a prospect asked one of our partners for a PoC to “see how the process would look after its automation”. The answer: “the process will look the same as before, only without the user”.
What may seem like a joke is nevertheless the key to RPA: the automation process is similar to the manual one, only without user intervention. This doesn’t mean that the main benefit of RPA is replacing humans, but provides a great number of improvements associated with automation: increased productivity, reduced inactivity time, greater availability, the ability to reallocate resources, error reduction, a higher level of accuracy, and a global improvement in the quality of the whole process.
Globally, many companies continue to associate RPA exclusively with the replacement of workers, often causing not only rejection within their organizations, but also a certain degree of social alarm. Aware of internal sale difficulties faced by our clients when presenting new technological initiatives in their organizations, we decided to incorporate a ROI calculation tool into the Jidoka platform itself. The ROI calculator considers not only time and resource savings, but also indirect factors that should be understood as part of the automation journey.
Without including abstract or theoretical concepts, Jidoka introduces simple, but effective saving/improvement indicators into the calculator: expected error reduction, equipment management costs, workplace costs, administration costs… Costs that are well known and allocated directly by the client for each Business Case.
Of course, this is an estimation that even a simple Excel could make. The real PoC is given through the “Actual ROI”, when the Jidoka platform starts to provide real statistics to benchmark against the estimated Business Case. This is when our clients check – and can defend internally – the ROI evolution. Has the process been improved? Maybe not its design, which can remain unchanged, but its result and efficiency.
And finally, beyond the ROI number, there are the opportunity costs. These are intangible values which cannot be contemplated in a calculator, since they depend on the strategy and positioning of each organisation. How much does it cost not to adopt automation in a market on its way to large-scale digital transformation? Obviously there are different levels of adopters, depending on territories and economic sectors. Let’s take the example of the BPO industry, a market that currently moves approximately 120 billion dollars and has a high maturity level in automation. Analysts in Morgan Stanley´s report, “The rise of the machines”, concluded that current savings of up to 25% can be increased to 50% with the use of cognitive components. Can the traditional BPOs still compete with the new digitized companies, no matter where is located? Or will RPA seize the day?