Swift progress in various technologies, such as generative AI, cloud computing, and robotics, has raised optimism regarding potential process efficiency improvements across industries. Operations executives globally are implementing automation tools and strategies, along with ongoing long-term IT modernization initiatives, to boost process efficiency across their organizations.
Intelligent automation has been a major enabler of improved process efficiency and one of the core aspects of Trinetix practice for years now, giving us a strong understanding of its impact. In this article, we share our insights and hands-on experience on how to improve process efficiency across different business contexts through intelligent automation and beyond.
The role of automation in boosting process efficiency
Efficiency is the backbone of a resilient enterprise, and to achieve it, the shift towards automated, insight-driven, and intelligent processes has become an absolute necessity. In this pursuit, intelligent automation initiatives stand out as the major enabler of operational excellence. By gradually integrating smart, automated processes and data-driven insights, enterprises not only streamline processes but also achieve a number of critical advantages.
As industry leaders continue to look for ways to improve process efficiency, the automation market is on the rise, with intelligent process automation alone valued at $14.4 billion this year and the prospects of growth up to $29.5 billion by 2030.
The number of companies adopting automation solutions to increase business process efficiency is growing steadily due to the benefits automation offers to enterprises:
- Consistency and accuracy: Automation ensures that processes run consistently and with high precision. Unlike humans, automated systems do not suffer from fatigue, distractions, or variations in performance. This leads to a reduction in errors and quality inconsistencies. For example, when it comes to critical data entry, automation eliminates errors, leading to more reliable and accurate data.
- Increased speed and output: Automated systems can work much faster than humans, especially when performing repetitive tasks. Such an increase in speed can significantly reduce the task processing time. For instance, automation allows for improved document processing, which boosts the speed and accuracy of the process.
- Cost savings: While there may be an initial investment in automation technology, the long-term cost reductions can be substantial. Automation can reduce labor costs, decrease the need for overtime, and minimize costly errors. It also leads to both direct and indirect cost-saving. For instance, in the context of financial services, automation can boost the productivity of an accounting department directly by speeding up the document filing process, and indirectly by cutting the need to check the documentation for errors. These indirect cost savings will compound into considerable amounts over time.
- Scalability: Automated processes are often easier to scale up or down based on demand. This scalability is especially beneficial in industries with fluctuating workloads like retail or finance. For example, an e-commerce platform can automatically scale its server capacity during peak shopping seasons and reduce it during low-demand periods, ensuring efficient resource allocation.
- Data insights and analytics: Automation generates vast amounts of data about processes. This data can be leveraged for in-depth analysis and insights. By collecting and analyzing this data, organizations can identify bottlenecks, inefficiencies, and areas for improvement. Such a proactive, data-driven approach can lead to continuous process optimization and more informed decision-making.
Automation enhances process efficiency through consistency, speed, cost savings, scalability, and data-driven insights. It is a powerful tool for streamlining operations, reducing errors, and improving overall productivity. But how do you achieve these results? You will need a detailed plan and a structured approach that matches the needs of your enterprise and addresses relevant issues that might be hindering its efficiency.
Explore the role of automation in boosting product development. Read our expert insights
Insights first: identify, diagnose, analyze, and enhance
Improving the efficiency of processes requires a strong understanding of what really happens within the enterprise. In-depth insights and analysis of the current processes, deficiencies, opportunities, and limitations are critical for making the right moves. Process insights or process mining entails the capture of activities within a given process. This involves employing tools that record the entire process from its initiation to completion as it unfolds. This data collection enables swift diagnosis and documentation.
Subsequently, an enterprise can automate the start and conclusion of the process, allowing for the accumulation of substantial data volumes that are statistically significant enough to reveal variations in tasks subjected to mining and analysis. By obtaining a precise end-to-end overview, companies can extract valuable insights and, in the end, enhance or restructure the process.
Whether automation serves as the primary motivation or not, process mining fulfills three fundamental objectives:
- Furnishes a substantiating point to ensure that decision-makers do not rely solely on intuition.
- Uncovers process information that leaders may lack.
- Serve as a litmus test to validate the anticipated benefits of a new approach.
Upon gathering the essential insights, decision-makers can move on to implementing the optimization ideas. This process will require a robust implementation plan that consists of several critical steps.
Enabling process efficiency through automation: 6 steps to follow
Crucial decisions demand compelling reasoning. The first thing businesses need to do is monitor their process efficiency over a defined period, helping them understand what kinds of bottlenecks they have.
Substantial advancements in data analytics, AI, and machine learning not only facilitate observation but also empower companies to conduct a highly detailed analysis.
Data analytics enables companies to evaluate historical assumptions, intuitive hunches, and hypotheses before investing resources in devising solutions. This leads us to the major steps on the way to improving process efficiency:
1. Establish a leadership team
Change management and innovation leadership play a key role in improving process efficiency within an organization. This group is critical in guiding the enterprise through the process optimization journey and building a persistent innovative culture that drives the organization forward. The scope of responsibilities may vary, but this team is always at the forefront of the change performing critical tasks and making impactful decisions:
- Setting up the vision: The leadership team should clearly define the objectives of process efficiency improvements. This involves setting specific goals, whether it's reducing costs, shortening cycle times, enhancing quality, or all of the above. They must also articulate a compelling vision of what efficiency looks like and what it means for the organization. This vision serves as a roadmap for all employees, aligning them with the goals of the efficiency initiative.
- Change management: Leaders are responsible for effectively communicating the vision and goals to all stakeholders, from top management to employees. This involves transparency about the need for change and the benefits it will bring.
- Overcoming resistance: Resistance to changes, even the most positive ones, may occur due to a lack of awareness. The leadership must communicate the changes, the impact of these changes on the employees, and the general direction in which the team and the business are moving. The awareness has to come before the change, so employees understand what comes next, how it will impact their work, how it will benefit them, and how they can prepare. That way, the leadership can mitigate resistance and dispel concerns, ensuring the successful adoption of new practices.
- Risk management: Changes always bring risks along the way, and there has to be a plan for addressing them and improving risk tolerance. The change leadership has to assess the threats and their potential impact on the enterprise. Upon assessment, leadership has to develop contingency plans to minimize the disruption and ensure the successful execution of the efficiency initiatives.
- Forming and empowering teams: Leaders often assemble cross-functional teams responsible for specific process improvement projects. Apart from assembling such teams, leadership must also empower them to make decisions and implement changes within the scope of their projects.
- Performance monitoring: The leadership team defines and monitors metrics that enable continuous evaluation of progress and identifies areas that need specific attention.
- Continuous improvement culture: A leader must also set an example of commitment to continuous improvement by actively engaging in and supporting efficiency initiatives. They have to maintain the right culture by encouraging and rewarding employees for suggesting and implementing process improvements.
The leadership team is not limited to these responsibilities, as it will be actively engaged in each activity aimed at improving the process efficiency. These experts ensure that efficiency improvements are not just a one-time endeavor but an ongoing and integral part of the company's culture. More so, they will be instrumental in guiding each of the following steps.
2. Analyze the current process efficiency
As part of the discovery phase, this stage focuses on reviewing the current state to identify processes that make good candidates for automation. For this initial phase, we suggest the following actions:
- Observe the execution of the company's existing processes
- Engage in discussions with stakeholders
- Evaluate metrics that the company already tracks
- Document the current process flow
This exploratory step, also referred to as process mining, will help the business define its current situation in terms of process efficiency. Process mining employs data science to uncover, validate, and enhance workflows. By merging data mining and process analytics, enterprises can delve into log data from their information systems, gaining insights into the efficiency of their processes and unveiling bottlenecks and other areas requiring improvement.
Information systems, like enterprise resource planning (ERP) or customer relationship management (CRM) tools, furnish a trail of processes along with their corresponding log data. Process mining utilizes this IT system data to construct a process model or process graph. Subsequently, the enterprises get a complete process view with precise details and variations.
Specialized algorithms can also shed light on the underlying causes of deviations from the standard. These algorithms and visual representations empower management to gauge whether their processes run as intended. Furthermore, it reveals opportunities for integrating robotic process automation into processes, accelerating any automation initiatives undertaken by the company.
Learn how to identify the right candidates for automation in our guide.
3. Identify and address deficient processes
Once you have a precise understanding of current processes, it's time to pinpoint the most deficient processes. What isn't functioning properly? What is impeding the team from achieving its goals?
Remember that optimizing each and every process at once is impossible, so you need to prioritize the processes that require immediate improvements. Priority should be given to processes that are slower or impede more critical aspects of the enterprise’s functioning. For instance, lags in procurement can impact the availability of resources and supplies, which can lead to far-reaching outcomes for the enterprise, including supply chain breakdowns.
Discover the impact of automation on logistics and supply chain efficiency
Numerous techniques are available for addressing deficiencies and improving the efficiency of processes. Some of those techniques, like Lean and Six Sigma (or a combination of two called Lean Six Sigma), have proven to be rather effective in cutting redundancies, improving process efficiency, and boosting the value of process outcomes.
Lean and Six Sigma are both dedicated to achieving cost and process efficiency and the highest quality of services or products delivered to the users. While these two methodologies share common objectives, they each approach these goals from distinct perspectives:
- Lean focuses on eliminating waste, while Six Sigma places its emphasis on reducing variation.
- Lean achieves its objectives by deploying less technical tools like workplace organization and a philosophy of continuous improvement. In contrast, Six Sigma leans towards the utilization of statistical data analysis, design of experiments, and hypothesis testing.
Successful implementation frequently starts with the lean approach, focusing on optimizing the workplace's efficiency, reducing waste, and employing value stream maps to enhance process understanding and value output. In cases where process issues persist, more technically advanced statistical tools of Six Sigma may be brought into play.
4. Create an implementation schedule
Introducing improvements within a company requires effort, and amid the daily routine, there is little room to overhaul established practices. Implementing changes can also encounter resistance from employees comfortable with established practices, even if those practices are ineffective. An implementation schedule helps bridge this gap by providing a structured roadmap for introducing changes. It not only guarantees the successful execution of automation but also aids in managing expectations and fostering employee buy-in.
By following a well-structured implementation schedule, organizations can minimize disruptions, encourage a smoother transition, and increase the likelihood of the automation’s success. It offers a systematic approach to change management and lays the groundwork for more effective operations.
5. Train your teams
Emphasizing the importance of training, it's a crucial element for the project's success. The team that will manage new processes and tools must be well-versed in their operation. Technical training should cover the utilization of the chosen system, and it is equally important to share the goals behind the changes with the team, encouraging their participation and commitment.
Motivate your team by illustrating how the new solution will enhance their daily work. Engage them in the process to ensure more employees actively participate. Otherwise, the project might remain dormant, lacking the support of those directly involved in their daily work.
6. Evaluate and effectuate modifications
The implementation of new processes does not mark the conclusion of your efforts. It is essential to oversee newly introduced processes and tools to assess their impact and determine if any adjustments are necessary. Employing KPIs before, throughout, and after automation will provide a retrospective view of what has changed.
Implementing modifications is a natural part of process improvements while monitoring the KPIs is vital for ensuring their effectiveness. Regularly reviewing and analyzing data allows for a systematic approach to identifying areas that require adjustments.
Once you pinpoint the necessary adjustments, it is equally critical to act swiftly. Delays in addressing issues can lead to prolonged disruptions in realizing the positive outcomes of optimization efforts. Agility is key in this phase, as it allows the organization to adapt and respond to changing circumstances quickly.
Effective change management includes not only recognizing the need for modifications but also having a responsive and agile approach to putting them into action. By doing so, organizations can maintain momentum, minimize downtime, and continue to progress toward their goals in a dynamic business landscape.
Ready to reach a new level of process efficiency?
Key factors affecting process efficiency to keep in mind
Enterprise process efficiency depends on a multitude of factors, and these can vary depending on the specific industry, processes, and organizational culture. Let us take a closer look:
Process complexity vs workflow efficiency
Inefficient process standards
Best practices may look good on paper but fail to yield desired results due to people not following them. Organizations need to document procedures and create clear guidelines to ensure that employees follow established protocols.
The value of human capital
The impact of inadequate resources
Inadequate funding or misallocation of resources can impede the completion of tasks, leading to delays and process inefficiencies.
External factors beyond control
Changing regulations and compliance requirements, economic fluctuations, exchange rate shifts, and supply chain disruptions can affect the availability and cost of raw materials, extending production schedules.
Resolving the process complexity will require insights into how tasks are sequenced, identifying bottlenecks, and optimizing the sequence of operations. Process mapping and value stream analysis are common tools used in this regard. Organizations will also need standardization of procedures using realistic and achievable protocols based on available resources, technologies, or talent.
Continual training and development programs can help improve the skill set of the workforce leading to fewer errors and increased satisfaction levels. Encouraging a positive work culture and facilitating effective collaboration between the teams can break down silos, reduce duplication of efforts, and enhance overall efficiency.
Preparation for the potential impact of external factors is also critical. The ability to scale resources up or down in response to changing demands will be a key benefit here. Enterprises that can adjust their resource allocation quickly are more likely to maintain efficiency during fluctuating workloads.
While organizations may acknowledge the potential benefits of automation for improving process efficiency, they may also approach it cautiously due to the expected initial costs, time commitment, and planning involved. Nevertheless, the implementation of the above-mentioned practices will yield positive results in both the short and long run, boosting the overall process efficiency across the enterprise.
Proficiency and innovation are key factors in process improvement efficiency, especially in dynamic industries that demand adaptability. Our team at Trinetix boasts a track record of creating optimized enterprise solutions for Fortune 500 businesses and leaders in professional services, logistics, finance, accounting, and beyond. Intelligent automation has long been a core part of our practice, and we help our clients discover opportunities for improving process efficiency, eliminating risks, solidifying future-proof infrastructures, and scaling automation solutions for business continuity.
How are you ensuring process efficiency within your organization?