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  • “While cost reduction, mainly through the elimination of labor, attracts most of the headlines and generates considerable angst, our research shows that automation can deliver significant value that is unassociated with labor substitution. “

    tags: automation costreduction casestudies

    • we asked experts to consider how it could transform working practices in a range of settings—a hospital emergency department, aircraft maintenance, an oil and gas operation, a grocery store, and a mortgage brokerage.
    • The results, though hypothetical, are striking. Measured as a percentage of operating costs, the changes deliver benefits ranging from 15 percent in a hospital emergency department, to 25 percent for aircraft maintenance, and over 90 percent for mortgage origination.
    • While labor substitution accounts for some of this value, additional performance benefits are considerable in all cases, and sometimes greater than the value of labor-cost reductions
    • Citibank works with Persado, a start-up that uses AI to suggest the best language for triggering a response from email campaigns. The results are a purported 70 percent increase in open rates and a 114 percent increase in click-through rates.
    • Rio Tinto has deployed automated haul trucks and drilling machines at its mines in Pilbara, Australia, where it says it has seen a 10 to 20 percent increase in utilization in addition to lower energy consumption and better employee safety.
    • Meanwhile, numerous financial institutions and other companies deploy robotic process automation to collect and process data.
    • the Coca-Cola Company’s Black Book model uses algorithms to predict weather patterns and expected crop yields to inform procurement plans for their Simply Orange juice brand, so that no matter what the quality and quantity of the crops, they can be blended to replicate the desired taste.
    • , GlaxoSmithKline’s machine-learning-enabled model-selection process helps the company analyze many times more models in a matter of weeks as it could in several months using traditional processes.
    • However, extracting value from automation often entails redesigning entire processes, not just automating individual components of the process.
    • We estimate automation could cut the current process time in the United States from an average 37 days to less than 1, which not only cuts costs but eliminates errors, reduces defaults, raises customer satisfaction, and lowers drop-out rates.
    • The second imperative is for leaders to look beyond their current business processes and start imagining how automation will enable them, and others, to make bolder moves. The question to ask: How could a disruptive competitor or a player along the value chain use automation to upend your business model?
    • Future automation advances will depend upon more than technical progress. The cost of development and deployment relative to the benefits, regulation, and social acceptance are just some of the factors that will dictate the pace of change.

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Head of Employee and Client Experience @Emakina / Ex Directeur Consulting / Au croisement de l'humain, de la technologie et du business / Conférencier / Voyageur compulsif.
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