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How much time can automation save your business?

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Automation is the latest buzzword to hit the business community - and although it seems initially complicated - once implemented, it runs quietly in the background, drastically increasing efficiency by saving you hours each week.

Businesses worldwide are realising that automation can save costs, eliminate boring tasks, and allow employees to focus on higher-value activities. But navigating the complexities of automation can be difficult for businesses big and small.

It's difficult to know sometimes what can be automated, how much it will cost and what the specific benefits to your business will be.

In this report, we'll cut through the jargon and dive into specific examples of how investing in automation can save your business time and money.

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What processes can my business automate?

In a 2017 report from McKinsey & Company, they estimate that nearly half of all work activities can be automated with currently available technology.

To identify what tasks can be automated, break down the processes in your business into parts. These parts can then be broken into individual tasks. Each of these tasks is an opportunity for automation.

To decide which task to automate first, business owners must balance out the cost and difficulty of automating the task versus the potential increase in productivity.

According to the IBM Institute for Business Value, tasks can be ranked on 3 levels:

  • Basic: These tasks are repetitive and follow simple rules. The data they need comes from structured data sources. For example, issuing invoices, initiating bank transfers, and sending notification emails.
  • Advanced: These tasks recur regularly and require variable actions, but the outcomes are predefined. For example, creating a bespoke quote for a customer based on their requirements.
  • Intelligent: These tasks are unpredictable and don't follow simple rules. They require complex thinking to solve the task.

Using tools like Zapier, many tasks that are ranked as 'Basic' or 'Advanced' can be entirely or partially automated, saving significant time and money.

Expert Paul Mallory from the brand analysis site Consumer Gravity, underscored that the rise of ChatGPT is poised to usher in a new era of automation, particularly customer support chatbots.

Examples of automatable 'Basic' and 'Advanced' processes include:

  • Accountancy: Processing expenses, processing payroll, basic accountancy, and revenue reporting. Accountancy encompasses various tasks such as processing expenses, especially through Accounts Payable Automation (AP Automation), processing payroll, basic accountancy, and revenue reporting. The emergence of AP Automation has significantly streamlined how companies handle their bills, reducing time-consuming manual entries.
  • Business Development: Finding qualified leads, following up leads, managing the sales pipeline, onboarding new clients and managing contracts
  • eCommerce: Automated upsell or restock emails, abandoned cart reminders, chasing failed billing charges and chasing unpaid invoices
  • Customer Service: Triage support tickets, automatically answer FAQs, send appointment reminders, measure client satisfaction and request referrals
  • Marketing: Social media management, ad budget alerts, PPC reporting, and dynamic content generation
  • Office Management: Resource booking and scheduling
  • Logistics: Stock management, re-ordering, and dispatch management
  • Human Resources: Job application process management, employee leave requests, and employer onboarding

What if I don't automate?

Throughout history, businesses that have failed to adopt new technologies have suffered as a result. Recent examples include Kodak, who missed the switch to digital media and Nokia, who missed the smartphone revolution.

Companies miss out on new technologies for a wide range of reasons, including fear, technological pessimism, and the cost of adoption.

Put simply, if you don't automate, your competitors will outpace you. At first, the improvements might be modest, but as the printing press example shows, these improvements compound dramatically over time.

So, how much money can you really save by automating?

To calculate how much you can save by automating, you should focus on 4 factors:

Labour Costs

Automation reduces your payroll by either replacing, repurposing, or augmenting your staff.

With some types of automation, staff may no longer be needed, as the task is entirely completed by the automation. These staff can then be reassigned to higher-value work, driving growth in areas of your business that cannot be automated, such as sales, relationship management, or customer service.

To calculate how much labor cost could be saved:

  1. Calculate your current total labor expenditure for that position, including salary, benefits, and taxes.
  2. Calculate the hidden costs of the position, such as amenities, office space, utility usage, training, sick leave, holiday pay, and legal compliance.
  3. Add these values together and divide by the number of hours worked.

For example, one of your team might be responsible for entering invoices into your accounting system at £8 per hour, which takes them 10 hours every month, costing £960 per year.

Next, total up the fixed costs of running your offices and divide this by the number of staff.

Divide this by the number of hours worked each month to calculate an hourly cost. For the 10 hours of monthly invoice entry, our example office costs £140 per year to run.z

Our total labor cost is, therefore, £1100 per year to enter invoices. If you can find automation for below this cost, it's already worth adopting, but there are other factors to consider.

Time Loss

Automations work tirelessly 24 hours a day, 7 days a week, with 100% accuracy.

Humans are not so perfect. We need regular breaks, sick days, holiday pay, and are occasionally unproductive at work. Research suggests that 13% of employee productivity is lost on browsing social media alone.

To calculate the true benefits of automation:

  1. Calculate the time the automation would take to complete the task.
  2. Calculate the time a human would take to complete the task, minus any mistakes, breaks, or errors.
  3. Compare the two values.

For example, one of your team might follow-up with your customers to encourage them to re-order each quarter. This takes 4 hours to complete, but 20% of this time is wasted due to breaks and other time loss factors.

Operational Bottlenecks

Take a look at your existing processes and map your workflows, starting at the end and working backward.

At each stage of this workflow, reflect on your past performance, and identify where slowdowns have occurred previously or could occur if your business grew.

For example, one of our clients (Squiggle Consult) had a bottleneck at the start of their customer journey. For every new lead, 10-15 minutes of data entry was required. This meant only a fixed amount of leads could be onboarded each day, limiting the growth of their business.

By automating this data entry, there is no limit to how many leads can be onboarded, clearing the bottleneck.

By applying automation where these bottlenecks occur, you increase productivity and reduce the likelihood of bottlenecks in the future.

Opportunity Cost

The Oxford American Dictionary defines opportunity cost as "the loss of potential gain from other alternatives when one alternative is chosen."

In the context of automation, this means what are you missing out on if you fail to automate:

  • Reduced Costs: By adopting automation, you can produce goods or deliver services at a reduced cost in exchange for a one-time investment in automation. With reduced costs, you increase your profits, which can be reinvested in new opportunities.
  • Reduce Lead Time: With automation, you might be able to serve customers quicker, leading to healthier cash flow. For businesses with physical products, this also reduces inventory and storage requirements.
  • Reduce Errors: Automation guarantees that a task is completely accurate. Without errors, customer satisfaction will improve and labor costs are reduced.


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May 21, 2021
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