6 Key Metrics to Track When Automating Your Business
It’s official: You’re sold on automation.
Not only will it take care of the busywork that bogs you down through the day but it’ll also let you spend more time on the work that matters the most, helping you expedite your business’ growth.
However, when you’re just getting started with automation, measuring its performance can be a black box.
How do you know if it’s working?
And how do you know if it’s improving your productivity and bottom line?
Read on to learn about the metrics you should track to gauge the effectiveness of your automations, why they are important, and how exactly you can measure them.
6 key metrics to track when automating your business
1. Time saved
In the business world, people like to say that there aren’t enough hours in the day. And it’s for good reason. According to TinyPulse, over 70% of workers feel like they have too much on their plate each week and can’t get their work done on time.
However, since one third of tasks in 60% of occupations can be fully automated, implementing automation into your business could buy your team the time they need to finish their tasks on time, every time.
Time saved is the amount of time you can save by automating a process compared to when you do it manually.
This metric measures the exact amount of time that you can save every time an automation runs, as well as how much time it will save your team every day, week, and month.
“The most precise way to measure time saved is by tracking how long it takes to perform the process manually'', says Tom Nassr, the Co-Founder and CEO of XRay.Tech. “Then, you track how long it takes to complete the same task with automation and compare the two.”
2. Error ratio
One of the main benefits of automation is that it can drastically reduce the number of errors committed during a workflow or process.
When your team completes tasks manually, they’re prone to making errors, especially if they’ve been doing it for a long time or if tasks are particularly boring and repetitive. It’s human nature.
But how do you know how effective your automations are at reducing errors? You track error ratio.
Error ratio compares the number of mistakes that your team makes completing tasks manually to the number of mistakes that occur in your team’s automations.
In addition to error reduction, the metric also gauges whether or not you’re getting the full benefit out of your processes.
“You’ll usually find that successful automations are much more reliable and consistent than manual processes”, says Tom Nassr, the Co-Founder and CEO of XRay.Tech.
To measure error ratio, compare the number of errors made when completing certain processes manually to when you automate the same ones.
The higher the ratio, the more error-prone your manual processes are - and also, the more effective they are when they’re automated.
3. Deviation rate
As much as we rave about automated processes, they’re still built by humans so they aren’t bulletproof. Fortunately, you can use deviation rate to measure how optimized and effective your automations are.
Deviation rate is the number of times that you have to deviate or manually change steps in a workflow as a percentage of the total steps in the workflow.
According to the automation agency, WeMakeFuture, you can measure your workflow’s deviation rate by:
Combing through the workflow
Counting the number of steps where you have to manually adjust the step or deviate from the workflow
Dividing that number by the total number of steps in the workflow
The lower the rate, the more effective your workflow is.
4. New work created
The main benefit of automation is that it can take care of manual, repetitive tasks so your team can focus on the work that matters most to your business. And if you start tracking new work created, you’ll know exactly how much more impactful work you can do now because of automation.
New work created is the amount of new work you’re able to complete because you’ve implemented automations into your business.
“New work created is a more qualitative metric, but it’s one of the greatest benefits of automation”, -says Tom Nassr.
“For instance, with the amount of time that automations save you, is your sales team able to devote more hours to one-on-one conversations with leads? Are your designers able to spend more time collaborating and less time focusing on sharing files?
Creating a better workplace experience is one of the ultimate goals of automation and it should be reflected in the data you gather”.
To measure new work created, ask each team that has implemented any automations into their processes to track how many additional hours they can now allocate to their most impactful work and new responsibilities.
5. Cost savings
Every business wants to save money, and automation is one of the best ways to economize. You just need to measure its impact on your savings using the right metric. More specifically, cost savings.
Cost savings is the amount of money your automated processes have slashed from your operations.
The main cost that automations can shed are labor costs - the number of people required to run automated processes is much less than the number of people required to manually complete the same processes and the associated tools.
And since manually completing processes is likely only one of their many responsibilities, they can allocate more of their time to the work that impacts your business the most and, in turn, generate more revenue.
With automation, you’re not just saving money. You’re also making more money.
To measure cost savings, track how many hours that your people spent manually completing processes and multiply it by their hourly rate. Then, check how much the tools required to manually complete these processes cost and tack them onto that number.
6. Bounce rate
Some of your automated processes and workflows will actually be built for your users, like a native onboarding experience in your product with learning paths, suggestions, and microcopy.
And according to WeMakeFuture, measuring bounce rate — the percentage of users who leave or don’t finish one of these external workflows — will show you how intuitive and seamless they are.
To gauge bounce rate, take the number of users who bounced from your workflow and divide it by the number of users who entered the workflow. The lower the bounce rate, the more intuitive and seamless your workflow is.
Measuring the performance of your automations
Implementing automations into your business is an exciting endeavor but it’s even more thrilling when you can see how much they’re improving your productivity and benefiting your bottom line.
Ideally, you can track all six of the metrics that our experts from XRay.Tech and WeMakeFuture recommend to fully understand how your automations are performing. But if you want to start small, we recommend tracking the most fundamental automation metrics, like time saved, new work created, and cost savings.