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The Cost of NOT Deploying Intelligent Business Practices

The benefits of well-designed Intelligent Business Practices are becoming increasingly understood by Australian organisations, yet many are still to begin the process of deployment.

Why is this? Perhaps it’s a lack of knowledge of the steps required, or not having a clear understanding of the benefits that can be enjoyed.

Having worked with organisations of all sizes to replace tedious, manual processes with intelligent, automated workflows, we at Tecala can share the quantifiable benefits that can readily be achieved.

We do this by first identifying the costs associated with existing processes being used within a business. For example, did you know that according to the Australian Taxation Office, the cost of processing a paper or emailed PDF invoice is between $27 and $30?

With businesses having to deal with dozens – if not hundreds – of invoices every month, this represents a significant recurring cost. By deploying process automation and removing manual steps, the cost of processing each invoice can be reduced to less than $10.

The costs of not implementing automation go even further

Let’s start with another example, consider the impact that ‘misunderstanding’ events are having in your organisation. These events tend to occur when staff are unsure about the correct process to use or miss out steps that then lead to disruption and delay.

According to research conducted by IDC, the average cost of misunderstandings, which includes those involving key business processes, amounts to $900 per staff member per year. If that doesn’t cause consternation among senior managers, there’s something wrong!

Further examples are not difficult to find. When it comes to the processes associated with recruiting and onboarding new high-performing staff, there is room for significant improvement. Recent research conducted by consultancy firm The Dream Collective discovered it can cost firms $400,000 and up to two years in time for each new staff member. That is a massive hit to any bottom line.

Then there are the costs associated with having sub-optimal contract management processes in place. Research by World Commerce and Contracting has discovered this situation can shave 9% off a typical business’s bottom line.

If those costs are not sufficient to stir interest in optimising internal processes, consider the costs associated with ineffective employee communication and collaboration. Research conducted by US-based Webtorials has found these costs to equate to $15,800 per employee per year.

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Top of mind, but not at the top of the to-do list

While it’s true that the majority of organisations are probably aware that some of their business processes could be improved, they are yet to begin work. In some places, there could be an attitude that current processes – although inefficient – are working and so ‘if it’s not broken, don’t fix it’.

In other areas, making changes might just seem too hard. Some processes have been in place for many years and there could be fears that, if any changes are made, it will lead to disruption and frustration among staff.

Another limiting factor could be a lack of awareness of the improvements that current technologies can deliver. Process optimisation tools have come a long way in recent years and their capabilities are continuing to evolve.

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The impact of adding intelligence

The bottom line is that the cost of not deploying Intelligent Business Practices will be missed opportunities for growth. A business could well end up losing out to more nimble rivals who have lower operating costs and more efficient internal processes.

However, this doesn’t need to happen. Take time today to think about your organisation’s core processes and the extent to which they are holding you back. There’s likely to be room for improvement.

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