Does it make sense to implement before investing in process digitization technology?

Over the past two years, there has been a rapid increase in the number of companies that have decided to invest in process digitization, robotization (RPA), or want to implement a new ERP or CRM system. This is logical, as all technology players are competing to use AI, more sophisticated automated services, and better connectivity. This is forcing companies to “change something” and quickly introduce something technological.

In my experience, when companies are eager to quickly introduce a new system, implement RPA, or digitize, they typically describe their basic requirements in a clear and understandable way. At this stage, I often hear, “We have to be quick or we’ll miss the boat…”  Requirements are correctly collected with people from the process, process experts, engineers, technologists, etc., and a list of changes is created. In other words, a clear description of the future state. To illustrate, here are a few examples of typical requirements:
• The electronic production order must contain a QR code for order identification.
• Record of machine settings and position for each order in the system
• Automatic conversion of a confirmed offer into an order with a single click
• Real-time production monitoring
• Central customer database with a history of inquiries, offers, and orders
• Calculation module capable of calculating the price based on the product, dimensions, and weight

With a set of several dozen (sometimes even hundreds) of requirements, an internal IT department or external supplier is asked to perform a business analysis and try to prepare a system solution or purchase an adequate application. Actually, this is all fine, but I see a better alternative, which is to perform a so-called process audit first.

Process Audit – before implementing digitization

A process audit is a review of the processes concerned from the perspective of their current functioning, an analysis of problem areas, and proposals for changes that should be made before implementing technological change.

I see the following key benefits here: First, we reduce the number of requirements for the system and process, as we optimize some processes (yes, this is classic Lean). Sometimes we will implement beneficial organizational changes (transfer of roles and responsibilities, “First Contact Resolution” – resolution at the first possible point). This will, for example, simplify the endless setting of roles and rules in the system.

Another benefit is connectivity. Most teams work in “silos” and only see the details of their part. By connecting processes into logical units (E2E), we can write “the right requirements” much better. From my consulting experience after a process audit, there are about 30% fewer requirements than without an integrated audit. In the case of implementing a complex ERP or CRM system, this can have a significant impact on the cost of implementation.

The scope of the assignment and its sustainability is a separate issue. An interesting benchmark says that 64% of system implementations exceed the original budget. But with a process audit, this figure drops to 20-30%. It’s not zero, but given the cost of implementation, it’s an interesting approach to eliminating potential risk.

A few figures based on our last 20 or so process audits:
• The average length of a process audit for a company with 20-50 employees is approximately 2 months.
• We map 30-50 processes (depending on complexity and industry).
• We typically propose 25-50 optimization suggestions for the current process or define requirements for the design of a new process or system

What are the typical outputs of process audits focused on digitization?

– Process model – overview of all processes (typically in 2-3 levels)
– Interconnected “hi-level” model of processes, their interconnections, inputs, outputs, suppliers, and customers
– Individual process maps
– Capacity/allocation in hours (how much time we allocate to a given process – hours/FTE). We implement this if requested. The advantage is that individual savings can be easily calculated thanks to technology or optimization; the disadvantage is the complexity of the audit (greater allocation).

Descriptions of proposed changes and categorization:
1. Process changes – immediate
2. Organizational changes
3. System changes (yes, these are the requirements listed above)
4. We now also have a special AI/RPA category – isolated solutions for relatively quick deployment of AI or automation

A process audit is not a delay – it is insurance that will save you time, money, and frustration during the implementation itself. Companies that skip this step usually pay for it twice: once in an exceeded budget, and again in a system that does not solve the right problems.