Today we will look at what the Total Cost of Ownership (TCO) for Intelligent Automation means and how we can reduce it.

IA solutions can come with significant total costs of ownership (TCO) resulting in projects exceeding budgets, taking longer to implement, and failing to achieve expected benefits. So, to ensure you succeed on your Intelligent Automation journey, it is important to understand TCO.

Unfortunately, TCO has often been overlooked in the excitement of high ROIs that service and tool vendors advertise. While high ROIs are possible, the program should not lose sight of the real costs especially the hidden costs of implementing an IA solution.

What is TCO in Intelligent Automation?

TCO in Intelligent Automation Solutions includes all direct and indirect costs associated with the development, implementation, maintenance, and support of the automation program. It consists of three components: 

1. Upfront Costs: These include the costs associated with the initial development and implementation of the automation program.

2. Ongoing Costs: These include the costs associated with the day-to-day maintenance and support of the automation program.

3. Hidden Costs: These include the unforeseen and indirect costs associated with the automation program.

While the upfront costs are usually considered as we start the program, the ongoing and hidden costs are often overlooked. So those are the ones we should be careful about.

Reducing TCO - Key costs to consider

Based on experience, here are a few key “Hidden cost” areas to watch out for. We will be diving deeper into this in our webinar next week. 

1. Development Overruns: Many automation projects experience delays due to poor planning, process complexity, inadequate skills, or unforeseen technical issues. We'll explore how to streamline your development process so that you can avoid costly overruns.

2. Test Overruns: Testing is often an underestimated or overlooked phase wherein the testing cycles and UAT testing can be time-consuming leading to cost and time overruns. We'll share best practices for optimizing your testing processes and minimizing test overruns.

3. Infrastructure Costs: Implementing IA often requires significant investment in infrastructure, such as hardware, software, and networking.  If this is not planned well and not properly monitored, this can lead to cost overruns.  We'll explore how to reduce infrastructure costs and ensure optimal performance.

4. Support and Maintenance: Bots breaking, app updates, and website changes can all lead to support and maintenance challenges. We'll provide you with tips on how to minimize downtime and reduce support and maintenance costs.

5. Unused Bots: Shelfware and licensing models can result in unused bots, wasting your investment in automation. We'll give you strategies for maximizing your bot utilization and avoiding shelfware.

6. Training and Retraining Employees: Due to the constantly evolving nature of the IA, as well as the need to onboard new staff and upskill existing ones. This can be a costly and time-consuming process, especially if it is not done efficiently. We will discuss how you can reduce people's costs.

7. Change Management Costs: The introduction of new technologies and ways of working invariably create resistance and reluctance among employees. Change management efforts, including communication, and engagement activities, are necessary to ensure that your employees are comfortable with the new ways.

Those were some of the key costs you can consider to reduce the TCO of your automation program.

We will be going over these key areas and more in our webinar "The 5 Hidden Costs Of Intelligent Automation: Understanding & Managing the Total Cost of Ownership for RPA & AI Solutions”. Hope you can join us!

That's all for today.

See you again soon! 

Nandan

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