In this 2-part article, we discuss 8 automation errors and how organisations can avoid them in order to get the best value from their automation investment.
Smart organizations understand that business continuity and competitiveness run hand in hand with automation. And yet they often dive into an automation programme without considering the possible challenges.
In a world where robots are housekeepers, cars drive themselves, and machines can talk, it’s hard to imagine a time when balance sheets were created with spreadsheets, access control meant lock and key, and document was synonymous with paper! Automation has upended the modern world in numerous ways. For businesses, it fuels process efficiencies, increases productivity, and lowers costs in virtually every functional area, from manufacturing and marketing, to software development, and customer support. Technologies like Robotic Process Automation (RPA), Intelligent Process Automation (IPA), Artificial Intelligence (AI) and Machine Learning (ML) also free up human resources from mundane, time-consuming tasks, accelerate innovation, and empower organisations to generate more value.
Unfortunately, many businesses make mistakes that prevent them from enjoying all these benefits. In some cases, these mistakes actively harm the organisation, as these companies discovered:
- In 2012, an automated high-frequency trading platform at Knight Capital Group went on an unauthorised spending spree, snapping up 150 different stocks in only an hour of trading. Following this humongous $7 billion “mistake”, this former Wall Street giant went out of business, sold to a rival firm just a year later.
- In 2019, a bug in the Google Cloud Platform’s automation software caused a major service outage that left hundreds of its customers, including big names like Snapchat and Shopify, in digital darkness for over 4 hours. Google itself called the event a “catastrophic failure”.
- An automated Manoeuvring Characteristics Augmentation System (MCAS) used in Boeing’s new 737 Max 8 aircraft led to two major air disasters and 346 casualties in the space of just 5 months between October 2018 and March 2019.
- In 2013, Michigan, USA implemented an automated system at a cost of $47 million to manage unemployment claims. It incorrectly identified 50K cases as “fraudulent”, leading to chaos, a spike in bankruptcy petitions, and ultimately, thousands of expensive class-action lawsuits against the Michigan Unemployment Insurance Agency (UIA).
Usually, automation mistakes are more prosaic – and more avoidable – than the above 4 cases. In this 2-part article, we outline 8 automation errors and how organisations can avoid them. Our advice – if you plan to implement Business Process Automation in your org, please take care to avoid them.
#1: Automating the wrong processes
Sometimes organisations invest in automation because it’s what others in the industry are doing. While this is not wrong – and in fact, can help improve your competitive position – it’s important to first understand why you need automation, and what you need to automate, so you don’t end up automating the wrong processes.
First, understand which processes fit the criteria for automation, and which ones don’t. This will help you identify the best candidates for automation, how to prioritise them, and eventually yield good results quickly. Without this knowledge, you may end up investing time, energy and money into solving the wrong problems.
Evaluate current processes, highlight shortcomings or problems, and identify automation opportunities. Also keep in mind that not all automation is good automation, and create a plan accordingly.
#2: Adding more resources to inefficient process
This is #2 on our list of 8 automation errors (and how organisations can avoid them). Many companies assume that adding more resources to inefficient processes will somehow eliminate inefficiencies. But people are not always the root cause of a broken process, so why would simply adding more of them magically resolve the inefficiency problem?
Often, process inefficiencies stem from improper planning, poor risk management, lack of operational transparency, inadequate accountability and feedback, or a failure to identify operational interconnections.
Review your existing processes to identify the true causes and costs of process inefficiencies. Explore innovation and improvement opportunities, and assess if you can leverage these opportunities by adding more resources. If not, research automation technologies like RPA or IPA, and what kind of benefits and ROI they can potentially yield. If automation can add speed, simplicity and efficiency to your processes without adding more resources, isn’t it worth exploring further?
#3: Once bitten twice shy: lack of trust in technology companies
This one is more of a challenge than a mistake. If you have been burnt by a tech company before, it’s understandable if you don’t trust them. In fact, you’re not alone. The 2021 Edelman Trust Barometer survey of 33,000 people across 28 countries found that trust has declined across every sector, and tech has suffered the largest loss.
If your org is concerned about the way tech companies collect, manage, process, and share data, or is wary of snake-oil companies hard-selling their solutions, think of how this “trust deficit” prevents you from eliminating inefficient functional silos. It also stifles innovation, lowers productivity and profitability, and increases overheads and employee churn. Once you eliminate the trust deficit, you will experience all the benefits of automation technology.
To improve your chances of a successful transition:
- Do your research on automation vendors. Ask for “word of mouth” recommendations from other firms in your industry, and ask for customer reference sites from vendors
- Create policies and frameworks around auditability, transparency, ethics, and quality. Make sure your tech vendors are aware of them and align to them.
- Make sure you understand in full the customer engagement process of the vendor and how your project will be delivered. Additionally, create unambiguous Service Level Agreements (SLAs) and Key Performance Indicators (KPIs) to clarify performance and accountability standards.
- Before investing in automation, get buy-in at every level of the org – from the C-suite to floor staff. The right vendor can also help with this.
- Supervise all automated tasks or processes, and audit them regularly.
#4: Focusing on earnings, not improvements
A broken process can cost your company time and money. You can lose customers, risk non-compliance with mandatory regulations, and lose good people to frustration and burnout. And yet, many firms think that their time is better spent on increasing revenues rather than on redesigning processes, even if it means living with constant inefficiencies.
The problem with this approach is that it places you in a constant fire-fighting mode, where your focus is always on resolving short-term problems, rather than on achieving strategic goals for long-term success.
Process redesign yields many benefits in terms of increased efficiency, productivity, and quality in a sustainable and scalable manner. And automation-powered redesign can streamline workflows, cut slack and wastage, reduce costs, and also improve your competitiveness and compliance posture.
With automation, people can focus on more challenging tasks where human skills are critical. This motivates them to do better, improves their performance, and reduces turnover. It’s also a better use of their unique competencies, which enables the business to deliver more value to its stakeholders. So, by leveraging automation to complement rather than replace human resources, you get the best of both worlds. That’s why it’s crucial to focus on improvements, not just earnings.
Part 2 coming soon
That was Part 1; 4 out of the 8 automation errors and how organisations can avoid them. In Part 2, we shine a spotlight on the other 4 common mistakes that prevent organisations from making the most of the transformative capabilities of automation.