Improving internal processes through digitalisation
The more labour-intensive a job is, the higher the return on investment when evolving to digital, says Jannie Pretorius, professional services manager at Elingo.
In this, the second of our series on digitalisation, we examine how smaller businesses can use this to improve their internal processes, says Jannie Pretorius, professional services manager at Elingo.
And while this can be quite an intimidating path for these businesses to take, it does not have to be the case. Going digital can help change virtually any area of the company that is currently manual. Even mechanical or physical work can be digitised to some degree.
An example of this would be in the farming industry where a Harvester harvests a field, but still requires the operator to capture information at a terminal or on paper at the end of the day. In turn, this must still be manually verified and consolidated for a report or into a spreadsheet. Given the high chance of human error, this manual process often involves more work for the farmer than the harvesting itself.
Digitalising this workload sees sensors placed on the harvester enabling it to be GPS ring-fenced or possibly even become autonomous, all the while feeding information in real-time through to a central data repository. The information is completely accurate with no human error. A few business rules can check for variances that might need human intervention but because everything is centralised, reporting is automated. And if this is processed directly to the cloud, the farmer can access the information wherever he or she is irrespective of the device used.
Using digitalisation results in entire role functions in this business being either made redundant or downscaled. These resources can then be allocated elsewhere or used as a cost-savings exercise.
The impact on ROI
Looking at a more corporate environment, paper-based processes are low-hanging fruit that can easily be replaced. Business analysts can quickly root out these processes as many established companies use these manual systems simply because "it has always worked that way".
Changing traditional mindsets is one of the key aspects around digitalisation. Once that is done, it is much easier to digitise and review systems and processes that might not have changed for many years. Often, these optimisations open doors to integrate with already digitised platforms. This creates new metrics previously impossible to measure or monitor by business.
And as could have been seen by the previous example, the more labour-intensive a job is, the higher the return on investment (ROI) when evolving to digital. This is especially true when employees are paid at high hourly rates. Imagine your risk or financial assessor just needing to confirm calculations that took mere milliseconds to run after information was digitally captured by the submitting party. Compare that to weeks' worth of effort sifting through spreadsheets, documents stored in the wrong places or even saved under incorrect file names.
Granted, these might sound like extreme examples but with digitalisation even small innovations and changes in an office environment can have a massive impact. Digitising leave applications could free up an hour or two of people running around between multiple departments who might have disparate systems.
Planning for transformation
By performing a GAP analysis, a business analyst or consultant will be able to target the manual processes in the business first for digital transformation. They need to be mapped out as As-Is, and then there needs to be identified where the gains are. Companies should then produce a To-Be from that and go to market to match a technology or system that can achieve the desired outcome if nothing currently exists in-house.
Remember, it is much easier to have a supplier tick off criteria you know you are going to need, than to sit through hours of sales presentations and pitches, confusing your stakeholders on what they 'should want' instead of what you need to get a feasible ROI.
It is advisable to leave the more sophisticated solutions for the next phase or risk the dreaded never-ending project filled with a sea of misunderstood requirements and missed deadlines. Digitalise what you have, then build on it. How you end up using a digital solution might not always be how you planned it. It is about making the solution as easy as possible to use so you can adapt much quicker when new ideas start coming in.
Any process in the organisation can benefit from being digitalised but its success is largely dependent on the order in which the migration is embarked on. If executives are not completely convinced about the business benefits, it might be worthwhile targeting a 'quick win' that gets something digitalised fast and show the ROI.
Beyond that, the processes that are used frequently or involve a lot of repetition should be targeted. These usually take up significant time and by digitalising these, the business can spend resources more effectively on fulfilling its corporate mandate.