Many business leaders have been dreaming of obtaining the ability to give up on manual and repetitive processes and focus on essential competencies. That’s how Robotic Process Automation (RPA) proliferated. It allows strategic leaders and decision-makers to boost their team productivity, cut down on expenses, and augment revenue. For the workforce, it means less time invested in tedious work and more on creative activities.
Apart from implementing automation, leaders also need to assess whether it’s worth it. It is imperative for tech initiators to measure ROI derived from Robotic Process Automation initiatives. By doing so, experts can understand how much time or other resources the organization saves because of automation. However, one of the key reasons why leaders aren’t able to maximize their revenues from RPA is that they aren’t focusing on the right KPIs and metrics.
A Fresh Look at RPA ROI
A digital respondent’s survey mentions that incorporating RPA in business processes can lead to an ROI shift of up to 200% in the first quarter itself. Moreover, the community of RPA enthusiasts predicts that calculating RPA ROI across the lifecycle helps tech leaders save around 25% to 45% on labor costs. All in all, calculating ROI is an imperative aspect for business leaders investing in RPA implementation. By gaining a deep understanding of RPA ROI, leaders can:
- Make tactical decisions about automation during the planning stage
- Enhance and scale RPA initiatives for better outcomes
- Devise and develop automation support for successive investments
- Easily substantiate the initial investment to stakeholders with data-driven evidence
- Ensure that RPA bots are functioning well and providing optimal value to the business
Hence, it’s vital to understand that ROI assessment is not a final phase in the RPA lifecycle. Rather, leaders should focus on ROI starting from planning and integration to maintenance and governance. Given the considerable potential advantages, it’s fair to mention that implementing RPA solutions is an effective move. But, eventually, consider key metrics that can help strategists measure ROI, determine business profits, and finally understand how much cost-effectiveness RPA brings to the business.
5 RPA KPIs to Consider for Driving ROI and Project Success
- Break-fix Series
Break-Fix Series signifies the number of times an automated process disrupts and necessitates maintenance.
One of the challenging issues RPA organizers are experiencing, restricted by their incompetence to scale and improve RPA ROI, can be directly related to this metric. Tracking Break-Fix Series is highly important because it highlights how robust or fragile the bots built and implemented are. RPA bots breaking down substantially impact RPA ROI; since the bot is inactive and out of production. Meaning that, it’s not lessening costs or leading to improved operational efficiency.
Tip– Experts in the field of automation state that a bot might break down and require maintenance six times a year. Accordingly, experts can schedule Break-Fix Series monitoring and eliminate the unproductiveness.
- Break-remediation Hours
Break-Remediation Hours allows automation managers to realize how long it takes to resolve a bot that’s disrupted and how much manual effort is spent in rectifying the bot. This RPA metric points out how long the bot’s functioning value is sitting indolent and impacting the expected automation returns. Moreover, project managers can calculate the cost of an FTE to examine and fix the automation bots.
On average, the bots with vulnerabilities are unavailable to function for around 150 hours per Break-Fix Cycle. Including the time it takes to find that the bot is disrupted, probe the root cause, remediate, test, and re-launch.
- Root Cause Analysis
RPA bots are undergoing constant break cycles is an unavoidable event. However, project leaders must monitor and understand why bots are misleading in the first place.
The cause analysis metric is highly critical because it gives RPA managers the ability to discover breaks in the automation practices that stop them from scaling and maximizing bot uptime for greater profits. It doesn’t have to be related to a fixed period but can offer RPA consulting services providers a better perception of how the Break-Fix Series has grown over time. This can even be considered as a performance catalog.
- Automation Uptime
Bot availability also termed as Average Automation Uptime gives automation managers an overview of how often their bots are available to execute what they were programmed to do. This varies from overall utilization because it’s a validation of a bot’s capability to contribute to the anticipated business value at all times.
In general, RPA bots start with a value of 100% uptime. Once they’re singled out of production since they’ve shown inaccuracies or broken and need maintenance, uptime starts decreasing gradually. This metric must be monitored over a set period of duration, but the lengthier the better because the results will be more effective. A sensibly precise average that a group of RPA experts perceived is 92% uptime, which for small-functional bots doesn’t seem impactful, but for bots with substantial portfolios, this can incur a $2 million loss in business value as a direct impact of downtime.
- Value Lost in Downtime
A bot’s inaccessibility might leave resources idle and leaders may not be able to attain maximum business value. It specifies how destructive the Break-Fix Cycles are to a RPA project and why leaders might not be obtain the returns they were promised and connected to their policymaking sponsors. This metric necessitates detracting the enumerated downtime from the yearly expected business value.
Additional ROI-related Metrics in RPA
Total Profits of Ownership
Total profit ownership presents qualitative benefits of automation, including:
- Improved user experiences
- Technological improvements
- Enhanced workforce satisfaction
It’s difficult to assess them, but they offer a more comprehensive vision of automation technical strengths beyond simple figures.
Total Resources Obtained
This metric is an indicator of RPA’s human element. It measures the extent to which process automation frees up worker efforts. The workforce can redeploy their attention to other time-intensive, high-priority tasks by automating mundane activities. TRG metric helps business leaders understand how human resources are rearranged after implementing Robotic Process Automation solutions.
Total Value of Ownership
Calculating the value of ownership goes a step beyond resources obtained analysis. This metric evaluation requires leaders to consider the benefits that automation delivers to their company in terms of qualitative, financial, and strategic.
Total Cost of Ownership
Total Cost of Ownership is not a conventional ROI metric. It’s intended to help RPA managers or owners define an automation system’s indirect and direct expenses. In the context of Robotic Process Automation, TCO analysis includes the initial investment, setup, workforce training, maintenance, updates required, and the cost of hiring employees to work with the system, etc.
TCO = Implementation expenses + acquisition expenses + operational expenses + maintenance expenses + upgrade expenses
Intrinsically, it offers a wider picture of the investment needed apart from the upfront expense. It’s vital, as leaders need to consider how much they should invest to balance expenditures with the ROI.
Valuable Tips for Maximizing RPA ROI
- Choose the right processes for automation (time-consuming, and with the maximum potential for productivity improvements and cost savings)
- Constantly track and alter RPA bots for better alignment with business objectives
- Monitor ROI on a yearly basis. This approach can accelerate decision-making in the future by displaying how technology impacts business operations
- Train teams and workforce to utilize the automation tools appropriately
- Keep an eye on the implemented RPA platform’s functionalities and version upgrades. The processes may change with time, so managers don’t want to undertake major upgrades, version changes, or move to another tool.
Closing Thoughts
The above metrics on assessing RPA ROI and success rate will help project managers understand their automation setup. They provide a deeper viewpoint on what activities should be measured to have better control over the Robotic Process Automation network. Moreover, through strategic planning, deployment, and maintenance, managers can increase the RPA returns and attain fast digitization.
