Five reasons why automation initiatives fail

In the dynamic world of modern business, organizations worldwide are generally very enthusiastic about the potential of process automation. By automating tasks that are prone to human error, time-consuming, and often performed manually, successful initiatives showcase remarkable improvements in efficiency and effectiveness. Ultimately, the successful implementation of automation can transform organizational operations in a revolutionary manner.

However, despite the potential to bring revolutionary change, process automation initiatives frequently encounter substantial challenges and, in certain instances, outright failure. Imagine a team investing time and resources, fueled by excitement and high expectations as they embark on the automation journey. Yet, as the initiative progresses, the team’s initial enthusiasm fades, and the expected advantages in terms of IT and process efficiency become unachievable. What was once a source of excitement can turn into a challenge and a burden.

At KPMG, we approach automation as a strategic marathon rather than a quick sprint, requiring thoughtful deliberation, preparation, training, and dedication. This article explores the underlying causes of failures and unveils the five main reasons behind unsuccessful automation initiatives. Each of these reasons poses challenges that organizations need to address to ensure their automation initiatives contribute to long-lasting operational excellence.

Implementing automation within your organization requires a comprehensive and well-planned approach, rather than it being a quick experimentation project. Quite often, we witness organizations diving into automation without a clear strategy, resulting in a lack of team focus, direction, and inadequate performance and benefit tracking. While we acknowledge the value of starting small and experimenting with automation techniques, it is equally important to ensure that these initiatives ultimately lead to significant long-term improvements. Therefore, these initiatives should be incorporated into a thoughtfully designed automation strategy and roadmap. This proactive approach is essential to safeguard your automation endeavors from being classified as failed one-time projects. It is crucial to recognize that the successful integration of automation technologies in your organization requires a dedicated and intentional effort, rather than a casual side-interest approach.

To address this issue, organizations need to establish a robust governance structure. This is essential for driving automation initiatives towards sustainable benefits and operational excellence. It means that decisions need to be made regarding the involvement of employees in the automation process and careful consideration of the overarching organizational structure. Additionally, processes to manage implementation, performance, and risk should be created, enabling effective automation management. At KPMG, we recommend our 6x6 Governance Model, aligning automation initiatives with long-term organizational ambitions and delivering the promised return on investment. This model provides a solid foundation to start your automation journey, empowering organizations to act differently and achieve success.

When designing your automation strategy, it is crucial to consider the complete end-to-end customer journey and the entirety of the process. Do you truly have a clear understanding of where the process starts and to which final step it leads? What is your range of influence throughout the entire customer journey? Proper end-to-end implementation of automation can elevate the customer experience, but a fragmented approach can complicate and hinder the process. This can result in confusion, frustration, and even lead to the loss of customers, affecting both internal and external stakeholders. Therefore, it is vital to incorporate the entire customer journey, and apply the end-to-end mindset into the design and planning of your automation initiatives.

This task, however, is easier said than done, as it requires a comprehensive understanding and overview of the entire end-to-end chain. It commonly involves multiple stakeholders and subprocess owners that must align their perspectives on the automation strategy. Undoubtedly, the availability of extensive data plays an important role, serving as the foundation for visualization and insights at each step of the end-to-end process. Ultimately, successful automation implementations can only be achieved when the organization adopts an end-to-end customer journey mindset.

While automation initiatives can be implemented anywhere throughout an organization, it is crucial to develop process automation close to operational teams, as they have the most in-depth process and IT knowledge. The potential conflicts between automation technologies – such as RPA, IDP, and low-code BPM – and existing architecture vision and strategy are, however, often underestimated. Organizations frequently embrace new innovative technologies without a clear vision on aligning them with the current (legacy) IT infrastructure. Although the IT department may not have the bandwidth to address specific process automations, maintaining a collaborative relationship with IT is highly beneficial. Failure to align with architecture and IT can lead to misuse, underutilization, or even complete disregard of automation technology, resulting in low adoption rates within the organization. Furthermore, local automation initiatives may not be sustainably embraced by IT and could be labeled as failures.

To avoid this scenario, IT and business management teams must collaborate to establish a strategic vision for integrating automation with other technologies in the organization. By clearly defining its role and incorporating it into the overarching IT architecture vision, teams can ensure that adopted automation technology not only aligns with the existing digital infrastructure but also effectively fulfills its intended purpose. In fact, when an automation initiative is fully embraced and supported by the IT architecture vision, it has a much greater chance of long-term success.

As the design and development of automation nears completion and approaches its initial go-live, organizations often overlook the importance of ensuring broad employee awareness, training, and change management. Without effective change management, employees may struggle to utilize the technology effectively due to a lack of understanding or fear of change. In turn, this can develop resistance or dissatisfaction with the newly implemented approach, ultimately undermining the potential benefits of using innovative automation technologies. Furthermore, in many cases, only a small project group of individuals within organizations are involved in automation initiatives, resulting in limited knowledge and communication channels.

It is equally important to involve colleagues throughout the organization in the automation journey and openly communicate about achievements, next steps, and the roadmap. It is key to recognize and address how these technological changes will impact their roles and activities. Ultimately, it would be beneficial to foster enthusiasm about innovative automation technologies, encouraging wider adoption and familiarity throughout the whole organization. The greater the support from employees, the higher the likelihood of successful implementation within the company.

The transition to automation involves more than mere technological change. It reshapes employees' daily tasks, roles, and responsibilities, requiring a shift in mindset and a willingness to embrace new ways of working. Therefore, dedicating sufficient time and resources to training employees and effectively managing this significant change is crucial. Developing a well-defined change management approach helps employees understand the reasons behind the shift, the benefits it brings, and how it will affect their roles. Ultimately, this approach facilitates a smooth transition and maximizes the potential of automation.

Ultimately, the successful implementation of automation technology undoubtedly requires active support from executives at board level, particularly when deploying it across various departments. It is not just about securing funds, but also about sharing a vision to the departments and guiding the transformative potential of automation for the business. To fully capitalize on the advantages of automation, C-level executives must actively engage in the process, incorporating a holistic automation strategy that is measured against sustainable key performance indicators (KPIs). It is essential that both the business department and the board believe in the outcomes and learnings derived from the automation journey, turning it into a compelling business narrative.

Unfortunately, many failures occur when initial investments of time and resources are wasted due to a lack of authorization to expand and sustain the initiative. Without sufficient support and understanding of automation at the C-level, there is a risk of being overshadowed by cost-cutting measures, despite the enormous potential for cost reduction and process excellence that automation offers.

Therefore, the thoughtfully designed automation strategy mentioned at the beginning of the article is key here as well. This strategy should be supported by the C-suite, and it should be driven by KPIs that align with the automation initiative. This approach ensures that the organization's automation journey has a clear strategic direction, while also fostering accountability and securing necessary funding from the top decision-makers. Automation should be recognized as a critical enabler for future growth and scaling, leading to operational excellence. It enhances customer satisfaction throughout end-to-end journeys, streamlines processes, and keeps the organization competitive in the market. These are all compelling reasons that should spark the interest of the board, encouraging them to invest in and support automation initiatives.

Automation initiatives can be significant drivers for long-lasting operational excellence when implemented thoughtfully. However, organizations must recognize that automation is more than just experimenting with cutting-edge technologies; it requires a well-defined automation strategy, a focus on the end-to-end customer journey, alignment with existing IT infrastructure, change management, and, most importantly, active support from executives at board level. By addressing these underlying challenges, organizations can achieve the promised benefits of automation and create a sustainable competitive advantage in the dynamic world of modern business.

At KPMG, we believe that automation is not just another buzzword, but an opportunity to reshape the future of businesses. Check out the KPMG Hyperautomation Scan to evaluate your organization's level of automation and explore the areas with potential for growth. It is crucial to keep in mind the five common reasons behind failed automation initiatives and avoid these pitfalls. By doing so, your organization can work towards achieving operational excellence by means of a well-planned approach to automation.