Recently Gartner predicted that “by 2018 the total cost of ownership for business operations will be reduced by 30 percent through smart machines and industrialized services.” That’s a remarkable forecast considering how much businesses already rely on automated processes and technology to streamline everything they do. How can there still be so much room for improvement?
The biggest clues as to how this situation has come to be can be found in recent research from the Hackett Group that highlights areas where “world-class IT organizations outperform typical companies.” In this report, Hackett highlights four “key practices” that world-class IT organizations have in common. They align IT metrics and communication with the business, standardize applications and IT processes, integrate end-to-end business processes and carefully monitor business and IT outcomes. These are all good ideas, but they’re actually far easier said than done.
The challenge: process integrity
All of these key practices point towards several trends taking place in businesses for the last five years. First on the list is the blurring line between business users and IT. No longer is IT simply a service organization that provides the machinery a business needs to run. Both business and IT stakeholders need to use the same metrics and language to work for success together.
Next, standardized processes are required for both business and IT activities equally. In fact, for many activities such as billing, daily financial activities, inventory and other regular tasks, IT is used strategically to enforce standardized procedures and business rules across large, complex organizations.
Finally, integrating and monitoring end-to-end business processes are absolutely crucial for every industry. With the rise of big data and the need for up-to-the-minute analytics of many complex daily transactions, companies must develop fast, efficient and accurate IT processes that provide insight into supply and demand while predicting bottlenecks before they happen. In short, everyone — IT techs and businesspeople — must share real-time process information and work towards the same corporate goals.
Many leading companies have discovered that process automation across diverse lines of IT, business and technology silos is the fastest and most effective way to make sure that their own key practices perform the way they should. Through automation, managers throughout the organization no longer have to spend so much time monitoring processes and manually progressing step-by-step through daily business operations. Instead, they have time for analysis and innovation.
Know your processes
While process automation can provide profound benefits, any organization that implements it must do so in a very organized and realistic way. A successful program requires a company to assemble a team of business and IT stakeholders to collaborate on metrics, goals and how to keep improving. It also requires a close look at the current state and an evaluation of what can be improved both from a process and a technical standpoint. As Socrates said, “Know thyself.”
Once assembled, the group leaders should start by determining exactly how, where and when to begin automating processes.
Begin with activities that are repeated often and require high levels of accuracy and consistency. Build on these and automate more complex tasks that are not required as frequently. Finally, as the project proceeds, work together and keep asking: “Why?”
When you automate any business or IT process, you have an opportunity to remove unnecessary steps and streamline processes—and this is the time to do it. Organizations should never automate inefficient processes simply because they’ve “always done it that way.” Use the transition to automation to eliminate repeated or unnecessary steps and avoid errors and delays ahead. Early effort results in substantial gains later on.
For example, a major manufacturer recently began to evaluate many of its everyday internal processes for automation. In the process, it discovered how to operate even more efficiently. First, the company assembled a team of businesspeople and IT stakeholders to review the steps required each day to complete ordering, production and shipping tasks. The team analyzed exactly what happened at every step in real time. With a critical eye, they asked why tasks were done in certain ways.
This process helped the group remove hundreds of unnecessary steps from thousands of daily business processes. In the end, the company transformed more than 90 percent of its everyday activities — many of which relied on multiple manual steps— into far fewer, simplified and rational processes that could be automated quickly.
Today the company accomplishes more in less time and with less effort than ever before — in a much more simplified environment.
Market differentiation and corporate success depend on the timely and accurate execution of many different processes every day. To get ahead and quickly reduce the cost of operations as Gartner describes, businesses need to make the most of every minute.
Automating critical front and back-end processes is a powerful way to eliminate delays and human error while providing the quickest, most efficient customer experience possible for any business. However, when companies move towards automation, they must do so in a collaborative, logical and analytical fashion to reap the full benefit of all that automation has to offer.
Jeff Rauscher, director of Solutions Design for Redwood Software, has more than 31 years of diversified MIS/IT experience working with a wide variety of technologies including SAP, HP, IBM and many others. He has worked in operations management, data center relocation, hardware planning, installation and de-installation, production control management, quality assurance and customer support.