Measuring RPA Performance: The Impact of RPA ROI
Over the last few years, robotic process automation (RPA) has quickly become a transformative force across many industries. RPA leverages software robots to manipulate and communicate with business systems and applications, streamlining processes and reducing the burden on human employees.
Businesses are eager to adopt robotic process automation, but there are a lot of solutions out there and determining the right one for your business requirements can be confusing. The key to gaining a competitive edge through automation is finding software that meets your unique current needs and scales to your future vision with minimal additional cost beyond your initial investment.
Determining RPA ROI by measuring performance not only shows you how implementing a digital workforce can save money, but also is key to scale your automation implementation. This guide and the handy ROI calculator included in the Fortra Robotic Process Automation Toolkit, will help you complete a thorough and accurate evaluation of your investment, potential savings, and ability to scale.
What is RPA ROI?
ROI in RPA is a way to quantify the expected and actual returns on an investment in RPA that can help companies make better decisions, optimize their solutions, and learn from any pitfalls. Developing these metrics are critical to creating an effective roadmap for implementation, building support, and validating assumptions. However, it is necessary for companies to understand what data to collect, which benchmarks are valuable, and how to best make use of the information they gather. It is also important to know where to look to prove the value of RPA. Here are three key areas where a business can see an ROI of RPA:
The key metrics in determining your financial ROI are implementation costs and recurring costs associated both with the RPA tool and labor. Finding a solution that allows for immediate automation, as well as training services to enrich continued automation, could result in shorter time to value with a full-time RPA resource as opposed to consultancy resources.
To avoid locking in an unfavorable automation solution, organizations can choose to conduct a proof of concept prior to finalizing. This helps them find the provider that matches their precise requirements and can show that the solution will deliver significant benefits. Also be sure to consider the pricing structures offered by each vendor that will deliver the greatest ROI to your company. These options can include software subscriptions, paying on a price-per-bot basis, or purchasing an entire bot deployment. an entire bot deployment.
The primary reason that most companies implement RPA is to improve efficiency across the organization. The RPA implementation team should devise an efficiency calculation to compare human and robot productivity to showcase robotic efficiency and prove that the solution is saving costly human hours. The efficiency benefits of RPA are not meant to demoralize employees or prove that humans are less efficient, but rather highlight that human labor can focus on higher-value tasks that require more advanced cognitive abilities and not just speed through repetitive tasks and activities. This is one of the greatest benefits of RPA, as it allows companies to more effectively deploy their employees and innovate.
Customer Service ROI
Another major area that can increase your RPA ROI is customer experience. Although this may not provide immediate cost reduction, fast and accurate processing means improved quality and minimal error, which implies improvement in customer experience. Over time, this may improve the value of the brand and lead to increased sales. Establishing a baseline customer satisfaction level prior to implementation can help companies measure this impact.
Different parts of the business may respond differently to each type of ROI, which is important to think about when looking for buy-in for RPA. Whether it’s dollars and hours saved, or customers satisfied and retained, ROI is essential to consider as you prove the value of automation.
How is RPA ROI Calculated?
Once you understand what to measure, you can start to calculate RPA ROI and determine how much you will save by implementing RPA in your organization or plan your optimal RPA strategy. Our RPA ROI Calculator looks at a variety of factors to determine the return on investment of automating your workflows. Simply replace the sample data with your company’s inputs and let the calculator do the rest.
Learn more on Understanding RPA ROI in our guide.
Other RPA Investments
Inevitably, there will be some one-time costs associated with your initial purchase and implementation. In addition to the cost of RPA software itself, you’ll want to assess and plan for the cost of:
- IT infrastructure
- Initial integration with existing systems
- User training
- Creation and management of procedures and frameworks
As you scale your digital workforce and automate more processes, the savings will overtake these initial costs. However, you will still be left with some maintenance costs, such as:
- Software licenses
- Software maintenance and upgrades
- Development and testing
- User support and ongoing training
- Infrastructure updates
- Program management
Remember, the more you expand your automation and scale to include more software robots, the more these costs will be offset, resulting in a higher RPA ROI.
Have a Long-Term Automation Vision
If you’re considering purchasing an automation solution, you probably have a process in mind that needs automating. It can be smart to start with low-hanging fruit—especially if you need to get approval for the investment. But robotic process automation’s value is in its flexibility and scalability, so if you’re not seeking out further automation opportunities within the organization, your RPA software isn’t living up to its potential.
When you plan your RPA journey, you want to look for the highest-volume processes and the ones that would have the biggest impact on your bottom line. These are often not processes that are limited to one department, so make sure you investigate automation opportunities spanning the entire enterprise.
Once you have found the processes you want to automate, you’ll often get the best RPA ROI if you optimize them before automating. Too frequently, inefficiencies in manual processes get baked into RPA workflows, decreasing return on investment. RPA is meant to mimic humans, but that doesn’t mean it needs to take the exact steps a human would when you automate business processes. For example, sometimes a human workforce will have redundant tasks in order to check for errors. Robots don’t need that kind of verification. Start by documenting the entire process as it is currently being executed, then determine where you might be able to eliminate or merge tasks.
After implementing RPA software, the cost of adding more software robots should be minimal or non-existent, depending on your solution and the number of robots being added. Consequently, the more robots you add, the more you spread out the impact of your initial fixed costs. Continually seek out ways to expand your automation. We recommend having a team or committee responsible for finding and analyzing automation opportunities throughout the organization.
Some businesses turn to outsourcing for automation, rather than automating internally. While initially this might be easier or cheaper, implementing a solution internally has more long-term, sustainable benefits. When you automate your own processes, most of the expense is up front, but your automation will continue to scale cost-effectively alongside your business. Plus, you know your own workflows. RPA is intuitive even for non-programmers, and implementing it internally allows you to configure and tweak robots as needed—without relying on a third-party.
Choosing High-Reward Processes to Automate
To see the value of RPA software sooner, it can be smart to start with low-hanging fruit—especially if you need to get approval for the investment. When you plan your RPA journey, you want to look for the highest-volume processes and the ones that would have the biggest impact on your bottom line. These are often not processes that are limited to one department, so make sure you investigate automation opportunities spanning the entire enterprise.
Once you have found the processes you want to automate, you’ll often get the best RPA ROI if you optimize them before automating. Too frequently, inefficiencies in manual processes get baked into RPA workflows, decreasing return on investment. Start by documenting the entire process as it is currently being executed, then determine where you might be able to eliminate or merge tasks.
Is RPA Worth It?
Yes! Once you measure and calculate the impact of RPA on your business, you’ll be able to see the true value of an automation solution. Automating manual processes allows you to grow your business without adding more staff, and lets your human employees focus on more valuable projects while the digital workforce takes over tedious manual tasks. Robotic process automation works 24/7, giving you the value of having a digital worker that doesn’t take vacation, get sick, or go home for the night.
Enlisting the help of software robots also helps you optimize your human resources. For example, they might help to quickly access order history and other information that your customer service team needs to do their best work. Bots work alongside the human workforce, helping your employees perform well, thus helping your bottom line. People make mistakes. Robots don’t. Implementing robotic process automation can save you from spending any time correcting human errors.
Has your team ever written a custom script to automate a process? Custom scripts are often the first resort of businesses looking to save time, but in the long run too much scripting actually becomes time-consuming and risky to maintain. Robotic process automation software allows you to automate (or update) a task within minutes, so you can count scripting time into your RPA savings.
As you continue with your RPA journey, you’ll see down the road how important it is to know how to measure RPA ROI. As your business grows, you’ll be armed with the tools to scale your digital workforce to continue to reap more value and benefits from this transformative technology.