The mid-market guide to process automation

Executives at large U.S. corporations are increasingly investing in process automation to address labor shortages and above-average turnover rates. According to a 2022 survey by UIPath, 78% of senior leaders surveyed noted that they expect automation investments to increase. We’re seeing similar trends among middle-market companies, as well.

It’s hard to overlook the benefits of process automation to improve efficiencies and reduce costs. Automation can help accelerate growth and free up key members of the team for higher-level tasks that require critical thinking, problem-solving and client interaction. Yet investors and management teams may rightfully question the ROI of these efforts and wonder: when does process automation make sense?

What is process automation?

Let’s start by defining what we mean by “process automation”: applying technology to highly manual, repetitive business tasks or processes. The term is broadly used to refer to a number of specialized areas of automation that vary in complexity and cost:

  • Robotic process automation (RPA) uses software robots to mimic human actions and complete scripted tasks at a high speed and volume. Most mid-market companies use some form of RPA to save time and reduce errors. RPA “bots” automate individual, repetitive tasks like moving files, setting up new users or configuring systems.
    • Use cases: Data entry, migration and validation; report generation; marketing campaign personalization
    • Common tools / software: Automation Anywhere, UIPath
  • Chatbots and virtual assistants provide assistance or answer questions using natural language that mimics humans. They help organizations improve response times and reduce employees’ time spent addressing common questions.
    • Use cases: Customer service and support, sales qualification and appointment setting, internal help desk support
    • Common tools / software: Intercom, Drift, Salesforce Einstein
  • Business process automation (BPA) and business process management (BPM) improve efficiency, boost productivity and streamline the customer experience by automating complex, end-to-end business processes. Organizations use BPM software to analyze current business processes, identify areas for improvement and model streamlined processes.
    • Use cases: Invoice processing, sales contracting, supply chain management, procurement, recruiting and onboarding, customer service
    • Software context: Typically, three software capabilities are leveraged for automating processes: RPA tools + Workflow + Digitization (Optical Character Recognition)
    • Common tools / software: Workflow – ServiceNow, Oracle; OCR – Multiple products
  • Artificial intelligence (AI) and machine learning (ML) use algorithms and data to provide insights and make predictions based on patterns and trends. These technologies simulate human decision-making to automate tasks too complex or time-consuming for humans to perform efficiently.
    • Use cases: Tasks that involve analysis and decision-making
    • Common tools / software: Often involves custom development
      (In this VentureBeat article, we explore how to tell the difference between true AI/ML and simpler forms of automation.)
  • Intelligent automation combines RPA, AI and cognitive automation capabilities, automating complex tasks that require a high degree of accuracy, analysis and decision-making. And while it can be the most expensive type of process automation, it often drives significant ROI.
  • Internet of Things (IoT) uses connected devices to automate tasks and collect data, providing real-time data on operations and equipment. It can even be used to automate equipment management and maintenance.
    • Use cases: Monitoring inventory levels, controlling temperature and lighting, home monitoring of patients
    • Common tools / software: Arduino, Raspberry Pi

Benefits and financial impact of process automation

Process automation helps streamline complex business processes like managing inventory or processing invoices, freeing employees to focus on more engaging, higher-level tasks. It increases efficiency and reduces errors on simple, manual tasks like sending an email or generating a report, ensuring higher-quality deliverables. And most importantly, it enhances the customer experience by improving the speed of service.

Not surprisingly, financial impact is often the primary driver of automation. Automation conserves time and resources to reduce operating expenses (OpEx), lower the cost of goods (COGs) and improve margins. Ultimately, these operational efficiencies add enterprise value.

However, it’s important to remember that automation initiatives require long-term buy-in. Mid-market companies and their investors must ask themselves: Is there enough time to identify, develop, implement and validate the ROI? This question must be considered in the context of the budget cycle or a potential sale of the business.

As a general guideline, a 2022 survey by Automation Anywhere shows that the average ROI for RPA is 250% – realized six to nine months after deployment.

Getting started with process automation

Mid-market companies must balance the cost and expected outcomes of process automation to determine an approach that will generate the best ROI for their business. Here’s how to start:

Conduct a process audit

A process audit involves reviewing and documenting all processes, then identifying areas for improvement. Look for areas of inefficiency and processes that are repetitive or high volume. Even more importantly, gather feedback from employees who currently perform these processes to understand where automation is most likely to improve operations and reduce costs.

As part of the process, consider the barriers. In addition to the costs of implementing automation, you must be honest about your organization’s IT readiness and your employees’ ability and willingness to embrace automation. We dive into some of the common barriers to automation on the Intechnica blog.

Review your security practices

While many off-the-shelf process automation tools have good security capabilities out of the box, you’ll want to involve your security team in your process audit and automation design. They can help identify potential vulnerabilities and implement steps to mitigate security risks.

Establish clear metrics to define success

Clear goals and metrics will help measure the impact of your automation initiatives and allow you to demonstrate ROI. Common goals include reducing processing time, improving accuracy or reducing costs. Defining metrics that align with your defined goals – such as productivity gains, error rates and cost savings – will identify areas for improvement to keep your automation initiatives on track.

Right-size the solution and determine costs

While up-front costs are one consideration when choosing automation tools, you should be more concerned with the long-term cost and business impact. For example, you must consider scalability, ease of use and compatibility with existing infrastructure in order to understand the bigger picture. Often, the choice comes down to selecting an off-the-shelf solution or building a custom one. We look more closely at build-versus-buy considerations for process automation on the Intechnica blog.

Involve stakeholders

In addition to gathering feedback from directly-affected employees as part of your process audit, you need to build support among stakeholders across the organization as part of your change management strategy. A collaborative approach ensures that the right processes are being automated and potential roadblocks or challenges are addressed.

Take it one step at a time

To minimize risks and optimize ROI, it is often best to implement automation initiatives in stages. Focus first on the processes likely to generate the greatest benefits. Then, assess the impact and incorporate your learnings as you automate additional processes.

Measure, improve, optimize

Process automation is an ongoing process that requires continuous improvement and optimization. Use your defined goals and metrics to assess whether your automation initiatives are meeting objectives and demonstrating value.

When to avoid process automation

While process automation offers significant benefits in terms of efficiency, productivity and cost savings, there are some cases where it doesn’t make sense. You might reconsider an automation initiative when these conditions apply:

You’re quickly approaching exit. Will the initiative have time to produce results – or be viewed as an unnecessary expense? Most automation initiatives have a high up-front cost that requires months to recoup.

Your processes are already efficient or don’t have the volume to justify automation. Consider whether the cost of automation will outweigh the benefits gained.

Too much is in flux. If your processes are continuing to evolve due to a recent acquisition or integration initiative, it’s best to put automation plans on hold. Work through the kinks first and proceed when processes are stabilized. Automated processes are typically inflexible and will require reconfiguration to accommodate changes. In addition, because of the speed and efficiency enabled by automation, any errors in your processes will be quickly amplified.

Your processes are highly customized or require human interaction. Inflexible, customized business processes may require a custom application or approach.

Best use cases for process automation

Process automation applies to a wide range of business processes and workflows to improve efficiency, accuracy and productivity. With this in mind, we’ve identified some examples that commonly produce a significant ROI:

  • Invoice processing: Automation captures data from invoices, matches them with purchase orders and routes them for approval, resulting in faster processing and improved accuracy.
  • HR and IT onboarding: An automated onboarding process may involve gathering employee information, verifying employment eligibility, setting up payroll, scheduling training, requisitioning hardware and software, and configuring systems.
  • Customer service: Automation reduces wait times while handling large volumes of customer service inquiries and support tickets.
  • Sales: An automated sales process improves the efficiency of lead generation, prospecting and customer relationship management. This allows sales executives more time to focus on personal relationship management and deal closing.
  • Supply chain management: Automating order processing, inventory management and shipping tasks improves accuracy and optimizes inventory levels.
  • Financial reporting and compliance: Finance teams use automation to improve the accuracy and efficiency of data collection, analysis and compliance tasks.
  • IT operations: Improve security and reduce downtime by automating IT operations tasks such as network monitoring, backup and recovery, and software deployment.