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5 Hidden Costs of Intelligent Automation

Featured Insights
April 3, 2023

Intelligent Automation (IA) can increase your productivity and reduce costs: this has become somewhat of common knowledge.

However, as the world seeks to embrace the unparalleled benefits of this technology, an often overlooked and alarmingly underestimated issue has surfaced, putting organizations who have already adopted or are planning to adopt IA & RPA into some serious contemplation about their long-term returns.

Indeed, hidden costs turn out to be the most challenging factor for any organization, whether for IA solutions or IT in general. Harder to determine and much more complicated to plan around, hidden costs play a significant role in the total cost of ownership (TCO) in IA solutions and make tackling effective adoption & implementation strategies more burdensome.

Understanding Hidden Costs in Intelligent Automation Solutions

Enterprises that employ intelligent automation do so to achieve lowered costs, faster results, and more tangible returns on investments.

However, since the hidden (or surprise) costs of IA are not apparent upfront, they can accumulate over time. The additional expenditure thus negatively affects the ROI from the intelligent automation program and creates scalability and expansion challenges.

Hence, it is critical to understand & identify the hidden costs of IA solutions. These include all the unforeseen and direct and indirect costs, such as support & maintenance costs, infrastructure costs, license fees, and so on.

Components of Hidden Costs in Intelligent Automation

Infrastructure Costs

These involve the costs accrued by the technology infrastructure that hosts the automation solution. The hidden infrastructure costs in IA solutions usually include indirect expenses caused by underutilized infrastructure, unexpected breakdowns, security breaches, compatibility issues, data loss, data corruption, data thefts, network downtime & outages, and complex cloud infrastructure pricing models.

Licenses & Shelfware Costs

Failing to optimize licensing expenses and shelfware can considerably contribute to over-the-budget expenditures. It is important to identify vendor licensing changes, unused bots, and other shelfware to determine & eliminate the costs of unused capacity.

Operations/Governance Costs

An often-overlooked expense is the surprise operating & governance costs beyond direct the upfront and ongoing costs. The hidden costs related to operations & governance in IA solutions include audit non-compliance fines & expenses, compliance failures, legal issues, fines & penalties, failed implementation due to inefficient change management, and vendor/partner failures.

Design, Development, & Testing Costs

Expenses incurred due to unforeseen process complexity issues including variance and standardization, data constraints, data quality & availability, etc. fall under the broader category of hidden costs associated with analysis, design, development, and testing expenditures in IA solutions.

Support, Maintenance, & Upgrade Costs

Platform support, maintenance, and upgrade costs play a significant role in the TCO in IA solutions. Alongside upfront and ongoing costs, the hidden costs associated with support, maintenance, and upgrade contribute to the unprepared expenses. These entail costs accrued over time due to downtime impact, compatibility issues, and process & underlying application changes.

Learn more about how the hidden costs influence the Total Cost of Ownership (TCO), click to get the TCO Checklist: https://hubs.ly/Q01GfcJb0