How do you measure the value of automation?

1 Automation ROI

One of the most common and straightforward ways to measure the value of automation is to calculate the return on investment (ROI). ROI is the ratio of the net benefits (or savings) to the total costs of automation over a given period. It can help you compare different automation options and prioritize the ones that have the highest potential to generate value. To calculate the ROI of automation, you need to estimate the costs of automation, such as software licenses, hardware, implementation, maintenance, and training, and the benefits of automation, such as reduced labor costs, increased productivity, improved quality, and enhanced customer satisfaction.

2 Automation maturity

Another way to measure the value of automation is to assess the automation maturity of your organization. Automation maturity is the degree to which you have adopted and integrated automation into your business processes and culture. It can help you identify the gaps and opportunities for improvement and align your automation strategy with your business goals. To measure the automation maturity of your organization, you can use frameworks such as the Automation Maturity Model (AMM), which defines five levels of automation maturity: ad hoc, opportunistic, systematic, managed, and optimized.

3 Automation performance

A third way to measure the value of automation is to monitor the performance of your automated processes and workflows. Performance metrics can help you track the efficiency, effectiveness, quality, and reliability of your automation solutions and identify any issues or bottlenecks that need to be resolved. Some of the common performance metrics for automation include cycle time, throughput, error rate, availability, and customer satisfaction.

4 Automation value drivers

A fourth way to measure the value of automation is to understand the value drivers of your automation initiatives. Value drivers are the factors that influence the outcomes and benefits of automation for your organization. They can help you align your automation objectives with your business needs and expectations and communicate the value of automation to your stakeholders. Some of the common value drivers for automation include cost reduction, revenue growth, compliance, innovation, and employee engagement.

5 Automation best practices

A fifth way to measure the value of automation is to follow the best practices for automation design, development, deployment, and management. Best practices can help you optimize the value of automation by ensuring that your automation solutions are scalable, robust, secure, and user-friendly. Some of the best practices for automation include defining clear and measurable goals, selecting the right tools and platforms, involving the end-users and stakeholders, testing and validating the automation solutions, and reviewing and improving the automation processes.

6 Automation challenges

A sixth way to measure the value of automation is to acknowledge and address the challenges and risks of automation. Challenges and risks can reduce the value of automation by causing delays, failures, errors, or dissatisfaction. They can also impact the adoption and acceptance of automation by your employees and customers. Some of the common challenges and risks of automation include technical complexity, data quality, integration, change management, and ethical and social implications.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?