Why Automation Alone Isn’t Enough to Increase Your Company’s Productivity

You’ll need to transform your operational processes too…

What is Automation? Why it isn’t enough?

If you haven’t already, check out our other post on why automation is essential for your business to scale and achieve top efficiency.

Automation is fundamentally a technical tool and it can work very well, but in order to produce meaningful results it needs to be built for and operate within a coherent and effective business process system.

You probably have already tried (or know someone who did) to implement some sort of software solutions into your business operation. You may have had some results from them or you may have had little-to-no results with a bunch of problems instead, but however successful it ended up being, you are still here reading this. So it is safe to assume that despite the software you may have, you’re still struggling to successfully execute your business operation at your increasing scale while maintaining appropriate quality standards and financial efficiency as you go along.

In order for software to make you money, it needs to complete for you or effectively help you complete a business process, each of which should successfully end up producing a useful business deliverable that has real value within your business model, such as: completed client intake, delivered order, assembled shipment, signed up new client, renewed existing client, collected payment, filed legally required reporting, etc. Together, when all of these deliverables are put together in an appropriate structure, you end up coherently and reliably doing everything necessary to sustainably make profits in your business: you bring in and retain clients, you deliver your products or services to them, you collect your revenues, and you stay out of trouble with regulators and tax authorities.

In practice though, it gets more complicated than it first sounds.

All the deliverables that have to be produced within such a system are interconnected and dependent on each other, and there are different variations possible and a variety of circumstances, cases, and exceptions that have to be accommodated within the real context of your business, and that usually means that business processes tend to end up being very complex especially if you have an extensive business model with a high level of service and a lot of information and decisions needing to be processed on a frequent basis.

As you are growing your company, the complexity of your business operation will generally be increasing as you expand. You will take on new types of clients, you will offer greater variety of services to better accommodate their needs, you will have to adjust your client onboarding and service methods to be suitable for different customer avatars, you will be bringing more things in-house as opposed to subcontracting, you will be subject to more legal requirements, you will expand to new locations, you will add new vendors and partners and integrate with their processes, and if you are dealing with physical products or material you will have to expand storage and storage facilities for them. And that is on top of the sheer volume of deliverables to be produced increasing as you scale up.

All of this exponentially increases the amount of work that has to get done in your business, and not only does that mean that you have to hire a lot of people, it also means that controlling the work gets massively harder. Not only there are more details to watch, but you also are very busy growing the company (as you should be) and you are forced to delegate responsibilities away to staff and eventually some middle management within your business – and the further you get, the harder will it be for you to oversee and check what actually happens in your operations.

And within realities of a small but fast growing business, you usually don’t end up making highly rigorous procedure manuals and even if you do so once, they tend to go out of date quickly because you can’t maintain them as your operations evolve. Why? Because you get to the point where you simply have no way of knowing of all the details that go on in your business, and the individual staff and managers in your company figure out their own ways to do things, and usually this knowledge does not end up being fully coordinated. As such the operations and know-how about them becomes fragmented across the organization – even to the point where two different people may have totally different ways of accomplishing the exact same task.

Not only does that lead to dis-coordination, inefficiency, errors, and even potential sabotage by staff, it also means that it is hard to know how certain things are actually done in the business and what actually happens day-to-day as the knowledge these matters is split between different people and there is no single master blueprint that accurately reflects all the details. Even the things that you personally do or keep close watch on (at the expense of time with your family or time to grow your business) are still connected to and rely heavily on input from other people in your organization, which means that the bigger processes that they add up to are still fragmented and badly organized.

What will happen if you implement automation without improving your business process?

If you just try to make automations within the frame of your current business operation without cleaning up your business process system and without creating a cohesive and well organized business operation blueprint first, you will get either very limited results or no results at all:

• At best, you might automate some individual pieces of tasks in certain places but there will still be a lot of manual work around them that will have to be done to actually achieve a meaningful result in your business, so you will save a little bit of labor but the impact on actually streamlining a significant part of your business will be largely limited and you will still be bottlenecked by all the manual work around your automation.
• Or you will create automation that will fail to consider all the related processes that were connected to the process you are automating, so it will create problems in other parts of your business and you will have to assign people to manage the system and to catch problems in it and exercise workarounds in it, defeating the point of automation in the first place.
• At worst, you will just create a piece of software that will not actually be able to effectively perform your business tasks because of not having accurate understanding of the business processes entirely, and you will have to spend forever reworking it and tweaking it before you will have something barely valuable. Or you might just give up in the process and bury your investment entirely.

So how SHOULD you increase your company’s productivity and profits with automation?

The actual SECRET to making your business into an efficient Automated Money Making Machine successfully is to first clean up and organize your business operations to run through coherent and optimal business processes, put them together into an organized business process blueprint that will connect them all in one place, and then make software automation to execute as much of it as possible automatically and simplify/monitor the parts still left up to humans.

This way you will:

1. Clean up all of your fragmented and disorganized business operation details, so gone will be all your miscommunications, confusions and other mistakes that were rampant in your business and caused massive waste before;
2. Ensure the highest quality methods are being used by bringing in all of the knowledge that is distributed around your team and using it to define the best quality standards and outcomes, so that you will always deliver the best quality to your clients;
3. Define very cohesive and efficient business processes by making sure that all the interconnected parts of your business are taken into consideration and handled in the most effective way, optimizing your operational profitability;
4. Then create automation that will operate to ensure that these best business processes and quality standards are executed to a T and require as little human labor as possible:
   – in some places this will mean that your automation will run the entire process on its own, so you could fire some people and cut your payroll budget and not have to rely on so much admin staff
   – in other places you will define clear expectations and standards for people to achieve, and your automation will monitor and enforce these standards, allowing you to get consistent results out of your team and enforce strict discipline

This will make your business into a real well oiled automated machine that will consistently satisfy your customers with excellent service, and produce profit for you at great margins with very little fires for you to put out.

It won’t just be a piece of software, or some other tool that will help your business in some way. It will be a fundamental transformation of your business.