Answer
How do you measure ROI on automation?
Record the baseline before anything is built — hours spent, volume handled, error rate — then measure the same things afterwards. Without a before, there is no credible after. Return is the annual value of the time and errors removed, minus the build cost and any ongoing maintenance.
- Measure before
- Hours, volume, error rate, elapsed time
- Measure after
- The identical metrics, same method
- Payback to aim for
- Under 12 months
- Most common mistake
- No baseline recorded
What to record before you start
- How long the task takes, timed rather than estimated
- How often it runs in a normal week
- Who does it, and what their time costs
- How often it goes wrong, and what fixing it costs
- Elapsed time from trigger to completion
Costs people leave out
- Maintenance when the surrounding tools change
- The time your team spends on handover and training
- Subscription costs for any new service the automation needs
- Exceptions a human still has to handle
Why estimates are not enough
Almost everyone underestimates how long a familiar task takes and overestimates how often it happens. Both errors distort the case in opposite directions. A week of actual measurement beats a confident guess.
What good looks like
A process worth automating usually pays for itself within six to twelve months and keeps paying with no further work. If the honest projection is longer than that, the money is better spent elsewhere.
Related
How much does business process automation cost?
In the UK, automating a single business process costs roughly £1,500 to £6,500, and most SMEs spend £5,000 to £30,000 on their first automation project. Ongoing maintenance runs £500 to £3,000 a month. Cost is driven far more by how many systems have to talk to each other than by how clever the automation is.
Read→Which business processes should you automate first?
Automate the process that is repetitive, rule-based, high in volume, and stable. All four have to be true. The most common good first candidates are invoicing and payment chasing, moving data between systems, and first-response to enquiries — because they happen constantly, follow clear rules, and rarely change.
Read→How long does it take to automate a business process?
A single, well-scoped business process takes about two weeks from start to running. A connected set of three to six processes takes four to eight weeks. Delays almost never come from the build — they come from access to systems and from nobody internally owning the decisions.
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