Business automation: starting to understand

Remember the old cartoon about Nekhochukha? The lazy boy ended up in the country of the great Nekhochukhi, where most of the actions were performed by robots. I must say, the animators have painted a bleak picture of automation: a person inside robotic processes disintegrates as a person and loses the skills of social adaptation. This clearly runs counter to our beloved "Elektronik", which just preaches the value of combining automation and the human principle. Something has brought us into philosophy.



But modern business thinks about automation either as a compulsion, or as an unjustified waste, or as the only magic pill for all problems, and generally treats it with suspicion. But in vain. If so, we are starting an educational program on this topic.  

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If you try to find the definition of business automation on the Internet, you will come across various options related to control, robotization, artificial intelligence, etc. None of them will be comprehensive or accurate. Let's try to give a definition here on Habré.



Let it be like this first. Business automation is a set of working tools (programs and devices) that minimize routine, optimize labor and production resources in order to increase the productivity and efficiency of all business processes. Sounds good. However, how can automation be a collection of tools? This is a process. Yeah, for example, automation is the introduction of programs and the installation of devices ... Stop. Is there life after implementation? Operation, of course. Ok, let's get to the new definition:Business automation is the process of implementing and operating a set of working tools (programs and devices) that minimize routine, optimize labor and production resources in order to increase productivity and efficiency of all business processes. Wherever it goes, it can be mistaken for a working one, but still questions remain: what if there are no formalized business processes, and if there is no production resource, etc. 



But, if you turn to the sources, all articles about business automation immediately come down to the automation of business processes. They are accurately and succinctly defined by Wikipedia: “ Business processIs a set of interrelated activities or works aimed at creating a specific product or service for consumers. The BPM management concept views business processes as important resources of the enterprise, and assumes their management as one of the key organizational systems. " Well, automation is just the process of implementing and operating software tools to optimize and accelerate the flow of business processes. It's simple.



In theory, in an ideal world, business automation and business process automation are equivalent concepts, because everything in business is a process that can be discretized, decomposed into sub-processes and stages, and described. But in the real world, companies have a lot of activities that do not fall under the definition of a business process, the processes themselves are not optimized or are absent at all, and all work is done spontaneously. Therefore, automation tasks unexpectedly find themselves in a huge preparatory stage, in the code of which you need to analyze, describe and prepare business processes. 

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And if you expand a little, then competent and timely automation improves the state of affairs in any company: from Gazprom to a flower shop. Companies have different metrics, business processes, but there is a group of automation goals that is universal for most organizations. 

• Savings are one of the key goals of automation. Once invested in software, companies use it to either increase productivity or reduce costs. Thus, the company at least saves time and money on changing the structure of transactions and sales, while increasing turnover and profits. For automation to be frankly unprofitable, you just need to abandon the purchased program and forget about the money spent.
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It is definitely impossible to automate everything, since there are such things as communication, human thinking, communication with clients, etc. There are a number of activities that are excluded from the processes and can only use some programs, but at the same time not be automated to the end, for example, corporate culture, recruiting, personnel management, company management as a whole. These activities differ from business processes by a high level of sociality, involving a person not only as an employee, but also as a person. 



But the rest of the processes can be completely automated. As we mentioned, there are three main groups of business processes.

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Any business now collects a lot of data and it opens up interesting prospects for working with customers: you can make up-sales, segment, plan promotions, change the assortment, etc. Moreover, any decision taken on a whim, without an analysis of qualitative and quantitative indicators, is likely to turn into a failure. Collecting data manually, in Excel or Access, is hard and thankless work, since such information is easily lost or damaged, and it is usually very poorly organized. Automation helps to collect data in databases, and the DBMS reliably stores data and allows you to interpret it and build complex slices.In addition, storing information in a database is incomparably safer: access rights, backup, hardware protection allow all commercial and production information to be stored as securely as possible.





This is generally about all Russian business. Only the majority is still at the stage of denial.



Automation is ordering, organizing operational work and task management. All employees (and it does not matter at all, remote or office) work in a single information space of the ACS (PM, ERP, CRM...), coordinate their actions, receive and delegate tasks, see their tasks within projects and business processes, distribute their workload over time. The manager no longer needs to call everyone to him and chew on tasks - it is enough to put them in the system and control the implementation. All operational work is carried out in a single system and any employee can access the data within their competencies, as well as request access or download data, if necessary. Outside of automation, all this is a continuous spontaneous communication, in which it is easy to forget, make a mistake, or simply "imperceptibly" not complete the task. 



The human factor is, perhaps, the very first thing that automation fights against in a company.Here is an approximate minimum of corporate problems faced by small and medium-sized businesses: missed opportunities for contact with customers, forgotten and nowhere recorded data, time-stretched elementary tasks, office and remote procrastination, working “to the left” according to the company's profile, “own” private clients of managers, theft of commercial information, etc. When software for automating business processes of all levels (management, operating, support) appears in the hands, or rather on business servers, most of these problems are easily and relatively painlessly solved.   



Security is an essential function of business automation.Thanks to its architecture and software functions, ACS protects your data from unauthorized access, allows you to control the financial condition of your clients, and log actions in the system. Alas, there is no absolute protection - however, the presence of automation significantly reduces the risks associated with information security - in some companies to almost zero (especially in small businesses).



Despite the fact that business automation and especially business processes is a good "fad" of the RegionSoft team(we even wrote down a powerful process automation module in our CRM with a setup wizard and a visual designer, and we also conduct a basic audit of business processes for free on requests from this link), we do not undertake to assert that automation is a cure for all business diseases and that the magic button "Make good luck". 



First of all, you need to choose the right processes for automation:

• large processes - branching, complex, affecting several employees;
• recurring with any period (launch of promotions, shipments, standard sales, etc.);
• affecting all other processes and activities in the organization (training new employees, release of a product release);
• demanding in terms of execution (launch of promotions and promotions, customer support, some internal infrastructure management processes, etc.);
• routine processes - those that take a lot of time, are often repeated and at the same time do not require particularly intelligent actions (procurement, shipment, formation of document packages, etc.)

There are some downsides to automation. In addition to high labor costs and a difficult start, automation leads to a loss of process flexibility. Since an automated business process is tied to a machine, to an algorithm, it becomes formalized, standard. There are times when you have to move away from this standardization and solve an independent problem (a complex client, an exclusive supply, a complex human factor, unplanned risks). However, this is an exception, in general, formalization for the benefit of the company.

How do you measure the effectiveness of automation?

Measuring the ROI of business automation is difficult and each company may have its own qualitative and quantitative metrics. It is best to plan targets ahead of time to understand the speed of change. 



Speaking purely as an expert, for companies without the risk of bankruptcy and other financial problems, it is customary to consider the payback period of automation systems as follows: an optimistic scenario - 1 year, a realistic scenario - 2 years, pessimistic - from 3 years. However, this is a very average indicator, since companies have different turnover, different automation goals, different costs of the software itself. Therefore, it is better to think about the indicators and results of the implementation of the automation system in advance. 



What can be an indicator of the effectiveness of the implementation of an automation system in small and medium-sized businesses:

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You can also calculate the usual indicators, such as the cost of automation in relation to the company's turnover, to revenue, to net profit. These indicators can be compared over a period, and can be used to estimate how large the potential costs are before implementation - if the value is too high, it is better to check again: is there a more suitable vendor (usually this happens when a small company chooses some very an expensive system, believing that the expensive does not happen bad; it may not be bad, but completely inappropriate).



One of the working methods is to estimate by the cost of the business process or labor costs of each employee. Let's look at an example.

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And now let's get back to the question of the economic effect from the introduction of the automation system. You can make a calculation for each stage of all processes in the company and each employee involved - in the end, you get an approximate effect. Just do not forget that to estimate the cost of ownership of the system, you will need to calculate the integral indicator of the total cost of ownership (TCO), which includes the costs associated with the acquisition, implementation and operation of the automated control system; and the “cost” of an employee and his / her work hours should be calculated not by net salary, but by payroll, social costs, indirect costs (office equipment, office maintenance, Internet, etc.) 



Do not forget that TCO for cloud systems needs to be multiplied by the number of months used and it will constantly grow due to periodic payments, and for desktop systems TCO often consists of a one-time payment for licenses (or installments), the cost of revision, support and updates. Sometimes it is more profitable for a company to have a TCO, albeit more, but distributed in time - for such companies, for example, we offer a lease for the desktop RegionSoft CRM with the possibility of purchasing software after 7 months of lease and a bunch of other bonuses. 



By the way, about CRM.

Business automation tools

An automation system is everything that turns a part of manual labor into machine, automatic, and transfers it into the field of engineering and information technology. In principle, all means can be attributed to business automation tools (which includes everything from tenders to the production process): machines, equipment, robotics, software, communication channels, networks, etc. This is a huge body of knowledge that applies to each specific organization. But in the context of automation of business processes, as a rule, software + related hardware is considered (servers, VDS, barcoders, cash registers, electronic shelf labels, terminals, cards, access control systems, etc.) 



We, within the framework of Habr and our competencies, will also talk about programs that allow business to automate mostly operational work. 

How to choose an automation tool?

There are two main ways to choose a business automation system.

1. Purchase a ready-made solution from a vendor (developer) and carry out a professional implementation. Ultimately it's faster, cheaper and easier: there are so many solutions on the market that you can find anything from auto service automation systems, training course and beauty salon automation systems to large factory automation solutions. You will benefit in terms of timing, accuracy of implementation, correct training and will be able to start working in a new plane rather quickly.
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Of course, the introduction of automation systems carries risks: for example, you can start improvements and get out of the budget, face a boycott of employees, difficulties in training, problems with refactoring business processes. But these are the implementation challenges that any experienced vendor is ready for, which means you just need to get started.

CRM as a special case of business automation

CRM system is one of the most popular automation tools for small and medium businesses. And if earlier the CRM system automated only the sales department and a little marketing, now most of the modern solutions on the market are universal business combines. For example, our edition of RegionSoft CRM Enterprise Plusis already actually a full-fledged ERP and can in one program: automate sales, management of projects, tasks, KPIs, work with primary documents, includes mail, telephony, multicurrency accounting, logistics, warehouse accounting, cash accounting, multistep production, settlement mechanism, has more than 100 standard reports, various constructors and, of course, a mechanism for automating business processes. And besides that, every 2-3 years there are major releases that add the most popular functions to the existing ones. This whole story is called end-to-end automation - the safest and most convenient way to automate, when almost the entire company can work in one information environment.



CRM systemtoday it is a basic element of automation, understandable and urgently needed, especially in a crisis, especially for a distributed team. But what can I say - always necessary!



However, when choosing CRM, like any other automation tool, you need to remember about three main rules:

1. automation should not be redundant, inappropriate, overloaded and incomparably expensive in relation to the company's turnover and product;
2. automation should take into account the requirements of a particular business and meet them as much as possible;
3. automation must work and be effective.

According to various expert estimates, the level of automation of Russian companies is somewhere from 10 to 15%. This is very small. Yes, and with our own eyes we can see how, for example, the delivery of the Crossroads arrives at the terminals, check machines, everything is fine-tuned and works like clockwork, and the restaurant in the city center has only recently stopped issuing handwritten checks, the reservation is still written on a chalk board; how small IT companies invest in the automation of everything and everyone in order to be ahead, and serious trading companies manually fill out invoices and acts ... These imbalances are caused by national peculiarities, and distrust of technologies, and feelings for themselves in the space of the domestic economy. But the fact remains: with an automated business life is much better, safer and more sustainable. All the rest are contrived excuses.

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A cartoon about Nekhochuha, if you are suddenly not old and not a boomer: