Digital Processes Enable 6-digit Savings Potential
Nvolve support companies in successfully digitising their workflows.
Companies usually only factor in the obvious costs, such as paper and creation effort, when deciding on the topic of connected work. However, there are far greater challenges that add up to much more.
For many companies, the topic of paper-based processes is currently still undervalued. We talk to many customers and interested companies from manufacturing industries. In our experience, the costs incurred by paper-based processes are actually much higher than most companies think.
Real Cost Drivers
Is saving paper costs the main argument for why companies should digitise their processes?
It is a very important argument in favour of moving in the direction of a connected workforce. However, creation efforts and paper costs are only on the surface and therefore catch the eye directly. In addition, there are less obvious cost drivers hiding below the surface that many companies have yet to see.
The full extent of the cost is not transparent. In order to determine it, it is important to carry out well-founded analyses and, in case of doubt, to calculate with estimated values if the data situation does not provide any actual figures.
In order to approximate costs, companies need a starting point. For being able to estimate the actual extent of the costs incurred, it is important to carry out a kind of “digital value stream analysis”, specifically along the employee-led processes. If you do this, it becomes clear that, abstractly speaking, the costs of paper-based processes are made up of many cost items.
First of all, of course, the direct costs that arise in connection with the use of paper. In addition to the paper itself, these are the costs of toner, ink, etc. Then there are the personnel costs that add up due to activities such as printing, copying and the filing of paper documents.
Error and opportunity costs
Error costs occur when, for example, operational processes are carried out incompletely due to misinterpretation of text-heavy documents and then lead to scrap and rework. Finally, opportunity costs are the lost profits, because if you choose paper-based processes, you will miss out on the opportunities that digitised processes bring, first and foremost increased efficiency and productivity gains. Adding up all these factors adds up to a tidy sum, and it becomes apparent that there are a great many other insufficiencies besides paper costs that cause unnecessary costs.
Hidden Drivers
Another example is increased reaction times in the event of errors. After all, if an employee identifies errors or defects for which a quick solution or immediate consultation with the supervisor is required, in many companies he or she has to leave the plant or resort to other systems such as telephone, smartphone, paper or similar. This then leads to unnecessary travel times, long response times and operational costs. Such communication efforts can be significantly streamlined with the help of digitization through task management. Employees can then assign a task to their supervisor or colleague or communicate directly with them via live chat and solve problems in real-time.
Enormous savings potential
Typical savings potential is in the six- to seven-digit range, although this naturally depends on the application, the size of the company and the acute nature or impact of current challenges – such as current reject rates due to faulty process execution.
By eliminating paper and digitizing all production processes, a large number of non-value-added activities were eliminated.
How the path succeeds
In addition to deciding on the right technology, which should be considered with well-founded research, it can help if you stick to the guiding principle of “think big, start compact” during implementation. This means that you don’t have to start implementation right across the board, but you can develop use cases one after the other.
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