All that a CEO or CFO (and why not everybody in your organization?) should know about BPM and BPaaS by Proceedit, explained in less than 1,000 words

Each employee of your organization carries out, on average, 3,000 unitary tasks per month (for instance: make a call, send an email, fill out a form, record a transaction …) ie, about 20 tasks per hour worked, in other words, this represents an average unitary personal effort of around 3 minutes per executed task.

If the total direct cost of employees involved in your business processes is $ 20 per hour on average, ie $ 0.33 per minute; each unitary task of your staff has a direct average unitary cost for your organization of , roughly speaking: $ 1 / task.

A BPM Process is a computer application of a procedural nature, that is, who manages a working procedure or “workflow” previously established, launching personal tasks to people (employees or third parties people) to be executed at the time that it is up to them to do so and also, performing other tasks on its own, automatically, without any human intervention, called automated o system tasks.

A typical BPM Process includes around 50 BPM nominal tasks, from which the process automates about 50 % and the rest become “assisted” personal tasks.

Tasks that the BPM Process automates do not represent personal effort at all, which implies savings of around 3 minutes per task. The rest of tasks that the BPM Process serves are “assisted” personal tasks, reducing the human effort to execute them in the order of 1/3 compared with their manual execution or when they are performed supported by the existing register and transactional applications, that is, save the order of 1 minute per assisted task.

According to the above, the average reduction of effort by the implementation of a BPM Process is therefore: (50 % automated tasks x 3 minutes saved per automated task) + (50 % assisted tasks x 1 minute saved per assisted task) = average of 2 minutes saved per BPM Process executed task.

Therefore, with the implementation of a BPM Process, the human effort per task is reduced in 2/3 as average (from 3 to 1 minute per executed process task) or, what is the same, the productivity (tasks performed by person) increases more than 3 times and, consequently, the direct cost per unitary task is reduced from $ 1 per task to $ 0.33 per task, thereby generating a potential gross average tangible saving of $ 0.67 per executed process task.

In the operating modality called BPaaS (Business Process as a Service), the procedural automation solutions that we have called BPM Processes are served from the Cloud, without customers having to install anything on their systems although, of course, hybrid solutions can be designed, for example, data and documents handled by the process can reside on the client systems under their complete control to avoid any security or regulation issue.

Client pays the cost of such BPaaS services by a monthly service fee. This fee may include the personal service of those process tasks that are outsourced as a microBPO service (micro Business Process Outsourcing).

When you implement BPM Processes in the BPaaS by proceedit modality, no investment (Not CAPEX) is required and each process task served has an average system cost (OPEX) of around $ 0.12 per task as total operating cost, fee that covers absolutely everything needed for the service of the solution, including: 1) process consultancy, 2) analysis of the solution, 3) its development and customization, 4) its integration with client corporate systems, 5) user training, 6) the support of users, 7) the servers and other required equipment, 8) the licenses of the necessary software tools and platforms, 9) the communications, 10) the safety and continuity of service, 11) the corrective and evolution maintenance and 12) the service from the Cloud itself and real time 24/7 monitoring of the complete installation.

Of the two amounts calculated in the above paragraphs, gross potential tangible savings and total operating cost, we can deduce the net potential tangible savings generated by the implementation of a BPM Process under the BPaaS by proceedit operating mode, which we can express in three different manners:

Net potential tangible saving per executed process task: ($ 0.67 as gross potential tangible saving per executed process task) – ($ 0.12 as total BPaaS operating costs per executed process task) =$ 0.55.
Net potential tangible saving per month and per full time equivalent employee involved in the process: ($ 0.55 per executed process task) x (3,000 tasks per month per employee) =$ 1,650.
Net potential tangible saving per typical process instance: ($ o.55 per executed process task) x (50 nominal tasks per process instance) x (50 % of task execution ratio) =$ 14.

We speak here only about tangible savings and, more specifically, saving of human effort, because other contrasted benefits that the implementation of BPM Processes produces, such as: 1) reducing errors, 2) reducing other operating costs, 3) reduction and homogenization process cycle (SLA), 4) reducing of penalties and possible fines for lack of service or defaults, 5) involvement of third parties (customers, suppliers, consultants, citizens, students …) in the execution of certain tasks of the process, 6) supporting and making teleworking easier, 7) allowing the controlled optional outsourcing of part of the process tasks to third parties when they can not be done internally or it is more expensive or critical in terms of SLA to do internally than outside, 8) allowing an increased level of service without incurring in additional personnel costs, 9) providing real-time monitoring of the process and management of alerts and alarms when incidents appear or could appear in the near future, 10) allowing monitoring of the process by exception, 11) facilitating full process traceability, 12) providing a continuous audit …. are more intangible and therefore, their quantification is more debatable, but there are there, of course, and their impact will be reflected in the income statement in the short, medium or long term depending this on the type of benefit.

And we talk about potential tangible savings because, for them to become tangible and, therefore, we can monetize it and notice its effects appearing in the income statement, we should be capable to make real the potential of saving human effort provided by the implementation of BPM Processes, either by: 1) dedicating freed staff time to do other things, or 2) failing to cover natural staff attrition or retirement, or 3) reducing the use of performing overtime hours or hiring outside reinforcement staff, or 4) proposing reduced working schedules to employees who may be interested … or 5) readjusting the staff amount, where this is the only solution.

In short, the implementation of a BPM Process on the BPaaS by proceedit modality generates for the organization:

A net potential tangiblesaving of around $ 0.55 per executed process task or $ 1,650 per month per full time equivalent employee dedicated to process or $ 14 per a typical process instance.

Up to12 very significant intangible benefits of value with a clear effect on the profit and loss statement of your organization.

And, very important, our business model requires no investment and, therefore, no cost or financial risk are associated, and is not subjected to entry o exit barriers, applying for its service only a monthly variable fee depending on the requests for resources that each process in operation is demanding and, being that fee much less than the tangible savings obtained (always less than 25 %), we could then say than BPaaS by proceedit is a Not CAPEX, Not net OPEX deal.

Besides, we have very good news: in every organization, whatever its sector and whatever their size, there are tens (in small business), haundreds (in medium-sized enterprises) and even thousands (in large companies and corporations) working procedures that can be automated as BPM Processes and therefore being capable to generate huge potential tangible savings and the intangible benefits mentioned in above paragraphs.

Oh, by the way, if your LOB or IT people tells you that “as we have an ERP, a CRM, a DMS, a XXX, or a “legacy” system … our processes are already automated”, don’t believe them … entirely. We are talking about something else, precisely, about to install a top automation layer of a procedural nature, different and complementary to the currently automation tools deployed in your organization, which goes far beyond the pure manual registration tasks though assisted supported by the aforementioned applications and that also integrates automatically working procedures with such existing registration and transactional applications to further reduce the human effort required in managing your organization.

Are you interested in the subject? Do you have some doubts? Let’s talk … with you, with your LOB and IT people, and test us with a first process which is not going to cost anything until you see your business automation solution 100 % customized for your needs and 100 % integrated with the rest of your corporate applications.

As per our try & lease business model, only if and when you would be 100 % satisfied of the implemented solution, you could start consuming the BPM Process and, at the end of the month, you pay the corresponding monthly fee just for the services consumed (executed process tasks) without obliged minimum permanencies periods nor minimum monthly fees nor any other entry o exit barrier.

If you trust us, it will be a pleasure to help you to improve the efficiency of your organization with our try & lease, Not CAPEX, Not net OPEX, full barrier free BPaaS by proceedit model.

 

Josep Mª Cos i Riera

Josep Mª Cos, Founding partner

proceedit, “the BPaaS company” 

josep.cos@proceedit.com +34 660 193 163
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