Businesses in every industry are constantly working to achieve more while spending less. While cost optimization is easier said than done, new technologies can open the door to innovative systems that can save organizations willing to adapt time and money. Process automation is one of the most transformational technologies, especially in data-heavy industries like insurance.
What is Cost Optimization?
Cost optimization involves examining every area where your business incurs monetary or time expenditures and ensures that you’re getting the maximum value from your services while eliminating excess spending.
Areas that most often benefit from cost optimization include vendor costs for supplies and services and internal costs such as process efficiency and employee time. Re-negotiating vendor contracts or changing vendors can certainly help optimize business spending. On the other hand, internal processes are often overlooked, as the time spent can be viewed as less consequential than monetary outlay. While this mistake is easy to make, true cost optimizations take into account all areas where ‘costs’ are incurred.
How Process Automation Helps Minimize Costs
As we mentioned above, one of the most consequential areas in which optimization can be focused is updating and streamlining slow, inefficient manual processes. Many businesses rely on long-standing legacy systems to manage vital processes like data management and integration. While these outdated systems can be relatively cheap to operate, the real cost often comes in the form of lost time, with countless billable hours spent on tasks that could have been handled far more quickly, accurately, and efficiently.
Process automation can play an invaluable role in your cost optimization strategy when implemented correctly. In addition to taking the burden of time-consuming tasks like data entry and integration off of employees, automated systems are faster and more accurate than manual processes. This allows you to have quicker turnaround times and removes the potential for human error from the equation.
In addition, process automation supplements employee success. Automation minimizes the risk of employee error or redundancies, resulting in more efficient work and adding value for the company. One survey found that 60% of employees reported that they could save six or more hours a week of work if repetitive tasks were automated.
This is different from saying that automation can or should replace employees. On the contrary, automating tedious or repetitive tasks frees up workers’ time, allowing them to focus on the more involved aspects of their jobs. Not only is this efficient, but it has also been shown to increase productivity and morale overall.
Short-Term Cost vs. Long-Term Value
Even when the potential benefits of automation are recognized, many organizations are reluctant to take steps toward large-scale organizational changes. While each business’s reasons are somewhat unique, one of the most common perceived barriers to cost optimization measures is (ironically) the cost associated with implementing them.
Despite these concerns, there are several reasons why companies, especially those handling high volumes of data, should consider automation. Business software inevitably requires an initial outlay of money and a commitment to training employees in the new systems. Some business managers may balk at the thought of this type of spending, but effective cost optimization goes beyond the most immediate short-term outlook. When considering the bigger picture, efficient business practices have the potential to save far more money than they cost. These benefits are far from theoretical. As a matter of fact, experts estimate that automation could save the insurance industry over $390 billion over the next ten years.
Getting Started with Process Automation
When considering whether or not to make automation a part of your cost optimization strategy, you first need to understand the available options. Fundamentally, most non-industrial automation processes require specialized software applications to work. These solutions come in the form of out-of-the-box software that can be purchased and directly applied to the company and fully customized business applications tailored to your organization’s specific needs.
While both of these options have their respective advantages, the most cost-effective option for you depends heavily on how your business operates. Many common processes, such as data federation, are ripe for automation but often can benefit from standard or slightly modified tools. Other, more specialized operations can still be automated but may require a bespoke solution to reap the maximum benefits in accuracy and cost optimization.
Cost Optimization With Populus
No matter which industry your company operates in, cost optimization is one of the most vital aspects of ensuring that you stay viable through any situation. Expert vendor management and process automation can cut costs, increase efficiency, and keep your staff engaged by cutting out unnecessary busy work.
Leaders in the insurance industry have already begun adopting process automation solutions, putting them several steps ahead of those who need to be faster to implement change. Many organizations are hampered by their reliance on outdated legacy systems and manual processes. Streamlining and optimizing business processes allows companies to reduce costs, maintaining a competitive edge regardless of the overall state of the market.
Increasingly, organizations are opting to leverage automation to stay competitive. With 65% of workers utilizing some type of automation in daily work, the integration of process automation is vital to any business looking toward the future. By leveraging the impact of automation, business leaders can focus less on the day-to-day operations and more on the big-picture.
If you’re interested in implementing automation for your business, Populus can help.
Populus Technology has over 25 years of experience providing technology solutions to our partners. We help support your company’s growth by updating and automating your business processes and creating fully customized software solutions for unique workflows. We also offer services to manage your IT partnerships and connect you with the best third-party vendors in the industry to ensure you always get the most out of your tech partnerships.
If you need help with cost optimization or any other aspect of taking your business processes to the next level, Populus has the solutions you need. Contact our team today to learn more!