Can RPA impact your ROI? How?
July 26, 2021
9 min read
What is RPA?
Robotic process automation, commonly known as RPA, is software technology. It makes things easier. That said, AI components are used in this automation system.
These artificial machines interact with Software and digital systems and copy humans’ actions. As a result, one can easily manage, deploy, and build software robots. In addition, the integration of robotics can facilitate functions like checking resumes.
Software robots are similar to people. They can navigate systems, understand everything on a screen, and do more. However, RPA success also springs from how efficiently these machines complete the correct strokes and extract data.
Not only can RPA development deal with data identification, but they are also faster than humans. Moreover, since RPA is more consistent than the workforce, there are no stretching or coffee-break issues! One only needs to define actions, and robots do it incessantly.
Which sectors can benefit from RPA?
Today, this automation frees people from repetitive work and drives new efficiencies across many processes and industries. You can witness RPA success in many areas. Ranging from healthcare to financial services, RPA is largely assisting.
And from the public sector to manufacturing to retail, robotics is spreading faster than ever. The usage of this technology integration is diverse. IT, finance, legal, compliance, operations, and customer services are just to name a few.
The reason behind RPA success and popularity lies in its broad applicability. Virtually, business-rules-driven, any high-volume, regardless of how repetitive, robotics can do it all. The natural language processing feature is also brilliant.
RPA development is going on at a quicker pace. But, with that, cognitive processes of higher-level AI components and skills are required.
Is RPA transformative?
“RPA development is taking the world to another paradigm altogether. The work’s getting done differently.”
Instead of people, software robots do lower-value and repetitive work. It includes moving files and folders, logging into applications and systems, and copying.
Tasks like extracting, filling forms, inserting data, and completing routine reports and analyses are completed too smoothly by RPA. Features like image and voice recognition, engaging in conversations and chats, and interpreting text are integrated.
Advanced robotic process automation allows ML models to make decisions. It also comprehends unstructured data. A key reason why RPA development is changing situations is it gives humans leisure time to enhance.
Instead of carrying out high-volume, repetitive tasks, the focus is on becoming innovative. So, while human beings create, collaborate, and interact creatively with customers, RPA does its stuff.
Wondering if RPA does impact ROI? The answer is YES. Efficiency, higher productivity, and resilience are just a few among the returns it brings. But, before jumping in, here’s what you should know.
ROI, What’s that?
ROI stands for Return on Investment. In terms of RPA, it’s the balance of the cost of implementation, development, and maintenance of systems.
Such AI technology provides myriads of business benefits (measurable as RPA ROI). The ROI is all whether there are fewer costly errors, higher productivity, and satisfied team members or not.
What is the actual cost of RPA implementation?
As every business has distinct requirements and so, the RPA is tailored accordingly, no cost rule can be generalized. However, one may note that in comparison to Software as a Service (SaaS), RPA is less expensive. It is because it integrates into all architectures.
So, although implementation costs vary, here’s where RPA costs every time. Development and maintenance.
RPA development costs
Since many companies already have IT experts, the costs of integration and RPA development will be lower. So, one need not hire software creators from elsewhere.
It’s just that an internal IT expert would take some time to understand and design the system. And once an RPA (scalable) is created, you only need to implement it.
However, sometimes, it can be wiser to call external experts. It’s because your internal IT people wouldn’t have the time to do their assigned work for your business.
Further, they may even work overtime and reduce productivity. So, to save money and time, hire an external RPA developer.
RPA maintenance cost
Maintenance cost is another RPA investment cost. It is similar to that of the amount spent on software development. The good part is, however, it’s very reasonable.
If the RPA software isn’t bought from elsewhere (created in-house), you already have the budget included. Since your employees made it, you’ll also hire an RPA maintenance team, which isn’t separate.
Even if your firm hires another RPA manufacturer, the costs would be low. It’s because these developers will lend expertise to your IT people to maintain the robotic process automation.
In addition, as a part of the contract, your experts will understand how to audit the RPA software.
How to measure RPA ROI?
The formula is simple. Multiply the cost of manual labor with time spent on manually performing it. Then take the cost of RPA. Finally, subtract the previously multiplied value from the total robotic automation process amount.
License it as a technology or implement RPA as a service; measurement of RPA ROI should be done in weeks. It may extend to a few months but not years. A payback time for RPA development is around three to nine weeks.
Since one cannot adjust the capacity to needs in a service model, RPA payback time is shorter. Of course, in comparison to licensing.
What else matters?
The other costs of RPA are about hiring experts and training. RPA management and machine running also need expenditure. One must carefully consider the cost of RPA development and the internal capabilities.
Moreover, the key focus is on running and setting the RPA program. You may ask, for example, if you wish to focus on resources or reporting. Or you choose to analyze your AI components pipeline over building an in-house team for RPA maintenance.
Factors to consider in calculating ROI
One of the RPA ROI factors includes how swiftly does input result in an output. Further, also compare the difference in speed before and after the integration of RPA.
Next, check if your team still needs to rectify and find errors (after RPA integration). And how often do they find errors, how much time it takes to correct them? Most of all, is the correction time costing you? And if yes, how much? Note it all.
Finally, calculate the quality and speed of your team. It’ll tell you how productive your firm has turned since the introduction of RPA.
Also, find if your employees are spending more time on repetitive tasks or high-level ones.
Why is it important to measure RPA ROI?
Just like any significant tool, RPA success needs to be analyzed. Don’t you think it should be steered by your company’s strategy? Of course, yes.
For instance, if your business aims to become the best customer service, you’d prioritize AI components in that area. It is a simple but important step.
Your general strategy should drive your RPA strategy. It should be properly defined. Ambiguity would not bring you the desired outcome. To run an RPA program, clarity of responsibility is vital. Also, select the KPIs to fit your business goals.
When developing RPA success measures are overlooked, issues develop. There can be two problems. Firstly, it gets tough to steer the program well. Secondly, establishing support across the company gets difficult.
Who would need those reports?
It is imperative to show clear results when your firm is willing to get business-level stakeholders. If they are committed, they’d ask for RPA success reports.
However, when reports are absent or unsystematic, it creates problems in job changes. The next person has no idea of what’s to be done. It will be complicated for them to determine the program’s faith.
Finally, it’s important for these results to guide how useful the integration has been. It even poses the question if RPA development is good enough. When your firm knows what works, prioritizing and automation pipeline could be improved.
What may impact your RPA ROI?
If you aim to achieve high ROI, consider the following.
Is the platform scale flexible?
Real ROI can only be experienced when your firm can scale. And although you can start from scratch to scale up later, check if your RPA platform would allow that.
One example of scalability is cloud automation. However, consider this option only when you’re ready to pay extra maintenance and infrastructure costs.
Also, note that RPA should not increase your IT team’s workload. Here’s why. If your business needs experts for updating every tool, it will all turn slow, resulting in a sluggish upscaling.
Secondly, if you hire more experts, you’ll spend more which will bring your ROI down. So, keep a balance.
Can you find automation-worthy processes?
Certain firms visit experts to consult which processes are automation-worthy. Others discuss with their internal analysts. Either way, it’s clear you cannot integrate RPA blindfolded.
However, if you desire rapid scaling, you may go for process discovery. In this way, you can rectify the problems in existing processes. Finally, install RPA in the most efficient versions.
Make sure the tool is user-friendly
When you choose an RPA platform, check if it’s convenient for even the non-techy people to handle. Even business users and subject-matter experts should understand the basic AI working.
Also, it is advised to hire outside RPA developers instead of burdening the internal IT staff.
How secure would the RPA platform be?
Security isn’t just a concern of the IT department anymore. Even employers should be aware of cybersecurity. Amidst achieving a higher RPA ROI, one must not neglect security. Instead, be extra cautious as cyber issues can reduce your ROI.
Check the compliance and security standards followed by the seller. Choose AI components only after comparing the safety norms of all vendors around. For a shorter payback period and higher ROI, ask yourself if you’re ignoring any risks.
RPA makes it better, but something’s not in the bright light
Someone rightly said there are no pros without cons. So while RPA development has blessed businesses with unique shapes, it’s not all good. RPA positively impacts ROI in many cases. But don’t go for it without noticing the other side of the coin.
When the long-term, repetitive, yet necessary work shifts to RPA, it seems like an attractive recluse. Although the administrative work and processes get digitized and more efficient, there’s a risk that development and error fixing may stop. The focus now shifted to quick fixes and shortcuts rather than beginning with caution.
The implementation of RPA needs money and time. It may bring great outcomes in stand-alone tasks, but that’s not the whole story. Cutting corners on RPA will never be a good idea. It may lead to major errors in the long run. So your firm’s RPA ROI may dwindle.
Let’s take it practically. Adding smartness at the top won’t change anything about an inefficient system. Please know that around half of the robotic process automation systems fail on the first try.
So, while the integration seems easy, it may squeeze more resources than you thought, eventually.
Since robots aren’t humans, they cannot identify some errors only your eyes can catch. Image and voice recognition are amazing features. But sometimes, they fail. \
So, RPA may bypass errors or forbid unlocking systems in anomalous situations. You might miss significant errors and get into trouble if you totally rely on machines.
Not all problems are a smart fit for RPA development. Particularly when the stakes are high, you cannot neglect the overall risk. For instance, to handle purchase invoices, have software that would manage the data well from the beginning.
RPA maintenance isn’t hard. But it still needs to be fit for your business. Maybe your firm won’t want to invest in an RPI system if your way of working will drastically change. RPA robots can get significantly disrupted even if you make minor changes in the setup.
Benefits of automation
ROI (Return on investment) is a word used for the financial arena alone. No doubt, robotic process automation gives a brilliant ROI. However, there are more benefits that RPA development brings to your company.
Once your team is free from managing files and calculating, it can get more innovative. Your team members can excel in their respective fields and bring you creative ideas.
Instead of doing time-consuming, repetitive, monotonous work, they can develop new things. While RPA takes care of the commonplace but essential tasks, your firm rises to the forefront. An ROI table is too mathematical to ever explain these benefits.
So, whenever you calculate RPA ROI, a balance sheet isn’t enough. Take a look at the bigger picture created by the integration of AI components. The digital transformation accelerates through RPI, and your firm gets a competitive edge.
Key steps to speed up RPA ROI
Choose the right developers
Since you’d want your ROI to be high, select the right developers. Generally, these should be from an external IT firm. Now you may ask why hire from outside when there are in-house IT experts? Here’s why.
Do you have other technology-related tasks in your firm? Yes, you do (surely why you hired these tech-savvy people in the first place). But, if they start working on AI components and RPI development, it would hugely affect their main work.
Your company may even dwindle if you load them with too much work. So, even if contracting others seems expensive, it isn’t in the long run.
Have the right platform
While selecting your RPA platform, ensure it is scalable, accessible, and has diverse functions. It has been found that only three percent of the organizations that start robotics have a scalable platform. Even if you are beginning from the basics, your company may wish to scale up in the future. So, keep that in mind while AI integration.
Then, please know that not all technology goes well with every RPA software. Even if RPA creates a bridge between IT systems, it isn’t always compatible.
Some tools cannot connect with virtual environments, and that turns into difficulty in the long term. Choose RPA tools that integrate with many systems (if not all) to increase your ROI.
Lastly, check how diverse the platform is. There are two kinds of bots: unattended and attended. The type your firm prefers and work demands must be selected.
Pro tip: Unattended robots enhance your company’s ROI.
With all of what’s said above, it’s clear that RPA definitely impacts ROI. In a majority of cases, the results are positive. Businesses get enhanced after introducing robotics. If only a firm makes wise decisions (considering the cautions mentioned above), its RPA ROI can rise fourfold.
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