What’s the true cost of a failed automation?
Most organisations believe the cost of failed automation is equal to cost of the project that didn’t go live or didn’t meet the expected outcomes.
According to a report by E&Y and Deloitte about half the automation projects fail. That’s a lot of money being wasted, considering the automation market is expected to be USD24billion by 2030.
Unfortunately,?its not just money lost. There is a large invisible cost associated with failed automation.
The cost of technical debt
Companies incur capital expenditure on the purchase of bot licenses for their automation programs. Once an automation program fails, the bots can’t be returned and the technology team still needs to maintain the bot, spending time and money on it. Unutilised or under-utilised bots make an automation program unviable.
The cost of change
When an automation fails, the unstable process or application is likely to create higher future costs of rework. Lower the stability of a process, higher the cost of maintenance. Archaic and legacy applications are expensive to maintain owing to a steadily vanishing breed of people familiar with those systems. Accurately predicting the stability of a process is a critical factor while undertaking automation and helps estimate the true cost of automation.
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The cost of Proof of Concepts (PoCs)
Many businesses spend money and time on PoCs, testing an already proven technology. There are enough implementations to prove technologies like Optical Character Recognition, Natural Language Processing and Robotic Process Automation work.
“Businesses need to check for process readiness for automation, rather than test technology readiness for the process”
The cost of intangible results
A limitation of the traditional automation RoI framework is that it only measures quantifiable benefits like cost savings, productivity benefits and speed of delivery. However, automation can have far-reaching results that impact employee engagement, customer experience and competitive?differentiation. When a project doesn’t deliver expected results, employee morale drops and confidence in automation is dented, but these costs remain un-estimated.
To navigate the automation journey, it is important to know exactly what to automate. Creating an automation framework that delivers rapid assessments and builds an automation pipeline puts organisations on a scalable, sustainable and successful path to automation.
Chairman and Technology Entrepreneur
2 年Yes the opportunity cost is surely so much more than simply the actual cost of a failed project. For smaller businesses this can be a survival or not consideration , so really important to start small and quickly and build on that success, with a company such as LatentBridge which has the track record with SMEs, I agree.