What are the benefits of business process digitalisation?

Business process digitisation – what is it?

Digitisation is the conversion of a resource, such as a document or a photo, from an analogue (physical) to a digital format. A good case in point would be the scanning of invoices, contracts, medical files or photographs and uploading them to a digital data carrier, such as a laptop, server or cloud, so that they can be processed via a digital access source, allowing digital data to be used from any place on the planet, without any geographical restrictions.

Similar word, but different meaning – business process digitalisation

Digitalisation involves the conversion of a given resource or set of resources to a digital format, with added elements of task automation. The Outlook Calendar acts as a good example: you move your paper calendar to a digital format (digitisation), in which you can then plan your time and manage the time of your team or send automated reminders.

Another example could be the circulation of loan/leasing applications. Initially, they are passed around the company in paper form, and loan analysts use formulas to evaluate the applicants’ debt-carrying capacity. The digitalisation of this process would allow the applications to be filed in a digital format for the applicants’ debt-carrying capacity to be then verified by an automated decision engine. In this way, the entire process (or the bulk of it) would be carried out digitally, with elements of automation.

By the way, the last sentence is also the quintessential definition of process automation 🙂

Digital transformation

Now that we know the difference between digitisation and digitalisation, the answer to the other question, What is digital transformation?, is almost a no-brainer. It is easy to deduce that it includes all the tasks and activities related to digitisation and digitalisation; the phrase as such describes the transformation of business areas (or entire organisations/entities) from analogue to digital format.

What business problems are solved by process digitalisation?

Now that we have explained the differences between digitisation, digitalisation and digital transformation, we are faced with the most important question: what business and technology problems of contemporary companies and organisations can be addressed through process digitalisation? There is no room here for a more holistic treatment of the subject, so we are going to take look at just two fairly common difficulties, namely: HR and business process performance.

HR and business process digitalisation

Workforce shortages, high employee turnover and high employment costs: the labour market today is totally different than it was just 20-30 years ago, when the standard was to stay employed in the same company for life, and getting a job at a “private business”, a “state-owned enterprise” or a “company redistributing public resources” was looked on as a privilege by many. Employers could once sift through applications and hire driven, loyal employees without having to compete against one another with higher salaries. 

Today, as we all know, the situation is completely different. It is companies and enterprises that need to vie for experienced specialists. Factors such as individual drive for growth, elaborate career paths and the greener grass effect mean that, on average, people change jobs every 3-4 years (as reported by Hays, Motywowanie pracowników z wieloletnim stażem w firmie [Motivating Long-Term Company Employees]). This means that employers need to compete against one another, e.g. by offering higher salaries, perks, attractive office locations or training packages, which substantially increases employment costs. 

HR shortages and business process automation

OK, but what does process digitalisation have to do with all that? Well, quite a lot actually, since HR shortages can be compensated for with the automation of some tasks, which would otherwise be performed by specific professional groups. 

For instance, let’s take refund requests and the first line of customer service. In a classical model, in a large company, refund requests are handled by a specialised team of several people, the so-called Customer Service Department, which often collects data about the situation at hand and then passes them forward to the target department concerned with, e.g.:

• servicing,
• refund processing,
• technical or specialist support,
• payment (for instalment and subscription payment services).

At this stage, a whole team of people who do an incredibly important job, both from the perspective of customers and pre- and post-sales support professionals, and who are increasingly difficult to recruit, can be easily replaced thanks to process digitalisation, automated mechanisms and AI solutions.

HR shortages and business process digitalisation – conclusions

As you can see, business process automation allows the same or greater amount of tasks to be supported by a smaller team. This eliminates the need to continually source candidates from the market or increase employment costs. What’s worth keeping in mind, however, is that digitisation alone in this case would not be enough to achieve these effects. What is needed is the addition of elements of work automation.

Higher business process performance

As sales increase, every organisation faces the challenge of adapting or streamlining its business processes (which originally met its requirements but were not necessarily scaled up in step with the business). Sales growth causes an increase in revenue, but also generates more activities, tasks and processes, including back-office processes. 

At the risk of oversimplifying things, small companies struggle to survive, while large ones struggle against chaos. This gives rise to the following questions: How to rein in the chaos? How to measure process effectiveness? How to improve business performance? How to scale business and minimise inefficiencies? 

The answer is simple: digitalisation, or full or partial task automation.

What are the benefits of business process digitalisation?

Which processes should be digitalised then? Actually, all of them, except those, of course, which for one reason or another must be done manually (at least while the relevant technology is being developed). The profitability of such changes is reflected in many aspects, ranging from finances to especially important operational improvements, such as:

Shorter internal processes

Improvements or optimisations include offer, contract or other document approval, which may now circulate in a digital format with automated processes such as document signing, task time escalation, etc.

Automated tasks

The best example would be risk analysis in a consumer loan application intended for a purchase of a home appliance in a split payment plan. The analysis once took several man-hours, from the application to the decision; today, it can be done in max. a few minutes.

Work optimisation mechanisms

A good example is automated deadline monitoring, with task escalation when the deadline is missed. This can be integrated with external databases for automated data completion or verification (e.g. BIK, GUS, Biała Lista).

Monitoring processes and data-driven optimisation: identifying bottlenecks and inefficiencies

Processes that are completed using digital tools from start to finish allow you to acquire various kinds of data, such as duration, stumbling blocks, audit information and process incident monitoring.

All these data can be analysed to optimise processes in your organisation, which will translate into potential benefits in the future. Seemingly minor optimisations may enable you, e.g. help out a customer more quickly and thus boost their satisfaction with the service, making them more likely to come back or recommend us to his friends. In addition, in an age of instant access to information, food and entertainment, the user always wants everything delivered fast.

Service time is a factor that can make or break you as a market leader, able to compete against other players.

The flip side of digitalisation

This image of digitalisation also has a flip side.  I wouldn’t exactly call it a dark side, so as not to demonise the situation and belittle the opportunities it actually opens up for organisations. Let’s just say that it is just perhaps a…darker side. 

In our labour market and society, there are still people who incur debt. Not the regular, financial kind, but an educational or technical debt. They are employees and customers who are not yet ready for digitalisation. The pace of technological growth has surpassed their cognitive capacity for absorption, so they are unable to recognise the opportunities, chances and threats that come with digital transformation. 

We need to keep in mind that, in our pursuit of optimisation, the human factor must still not be discounted, but to get rid of the darker side of a process, you don’t necessarily need to resort to exorcisms. Sometimes all you need to do is switch on the light. What I mean is you need to educate people and introduce elements of change management. So, when going through a digital transformation, please, remember to educate your teams. Change is always a challenge and, at a certain stage, may be a stumbling block for all of us.

Digitalisation means more than just time savings

Going back to the upsides of digitalisation, of which we could provide an endless list, let’s recap the advantages that customers most frequently talk about and the benefits you can get when you digitalise your business processes. I will just mention a few to inspire you to think how else you can organise your business processes to do more, better and faster. So that your company can grow at a faster pace and have a positive social and economic impact.

Why digitise business processes?

• To improve the quality of external services,
• To boost the effectiveness of internal services,
• To have better control over processes,
• To boost competitiveness (more, better, faster),
• To save time (to facilitate data access for specialists and managers),
• To increase operational effectiveness by automating process elements,
• To optimise process support,
• To improve scalability,
• To improve information management,
• To be able to handle more tasks without getting a bigger team,
• To eliminate repetitive tasks,
• To create an innovative environment that will attract new employees.

Of course, these are but some of the most common motivations listed by business owners in my business space. If you are interested in the subject and, after reading this article, you want to know more, I encourage you to read other Altkom Service blog posts and contact us. 

We can chat, design solutions and give you tips on how to digitalise processes in your business. 

When does digitisation pay off? A practical approach

So let’s get down to specifics.

Subjectively speaking, virtually every process is suitable for digitisation, but in the business world such issues are most often decided by financial factors. We are talking about potential savings, faster process or customer service times, elimination of errors, improved process quality, maximised efficiency and other market differentiators that motivate companies to digitise their business processes. What follows is that the most important determinant of the implementation of an IT system (i.e. de facto digitisation), is the financial viability of the investment in question.

In simpler terms, digitisation pays off when it saves or earns us money for the time and capital invested.

How to assess whether a process is suitable for digitisation? Example

In order to effectively assess whether a process is suitable for digitisation at all, it is necessary to calculate what business benefits or savings can be made by digitising particular areas.

Take the process of handling complaints in a large organisation from the first part of the article. As a reminder, this is the process of receiving and handling requests from existing customers in a large organisation (enterprise sector). The process takes into account three service lines:

• call centre,
• specialist department,
• expert department.

As you can see, the entire process shown in the diagram is handled manually and all tasks require employee intervention (including those related to working in the system). In addition, communication with the customer and between employees is mainly by e-mail.

For the purposes of this article, let’s make some assumptions regarding the number of employees involved in the above process (the figures we have used here are based on our experience and many years of working with various customers in the large enterprise sector). Obviously, when adapting the model to your situation, they should be changed to suit the company, the team and the process under study.

Costs of the complaints and claims handling process in a large organisation

Assumptions on fixed labour costs:

Line 1 – 50 call centre staff,

Line 2 – 20 staff employed as specialists,

Line 3 – 4 20 staff employed as experts.

Based on Hays’ 2024 salary report, let’s take the average salary resulting from the employment relationship – gross for the employee. The calculation does not include additional employer costs such as renting an office, buying equipment, licences, taxes, maintaining a back-office to serve employees, utilities, benefits, health and pension contributions, etc. When including additional costs in the calculations, it would be necessary to multiply the salaries presented x1.5 or x2.

Average gross salary:

Line 1 – PLN 4,500 / FTE,

Line 2 – PLN 11,000 / FTE,

Line 3 – PLN 14,000 / FTE.

Let’s assume that the entire department handles around 800,000 customer cases per year. Assuming that Line 1 is able to handle 60% of customer cases on its own, the remaining 40% of cases (320,000) are referred to Line 2, where specialists handle 39.9% of the original number of cases, this results in only 800 customers being referred to Expert Line 3.

Assumption of average number of customers handled per year: 800 thousand

The entire department serves/contacts approximately 800,000 customers annually. Below we present the assumptions made in terms of the number of customers handled by each line involved in the process. We assume that Line 1 contacts and handles all customers, Line 2 contacts 40% of customers and Line 3 gets 0.1% of extremely difficult or unique cases.

Line 1 – 100% contacted, 60% assisted (800,000 | 480 thousand),

Line 2 – 40% redirected, 39.9% assisted (320,000 | 319.2 thousand),

Line 3 – 0.1% redirected, 0.1% assisted (800 | 0.8 thousand).

It should be noted that in the above case, as many as 319.2 thousand customers are served by two lines and 0.8 thousand customers are served by as many as three departments. In the final calculation, this affects the cost of customer service, and cases requiring the intervention of as many as three departments (due to the level of complexity of the case) reduce the level of profitability on the service provider’s side.

Annual team maintenance cost

Let’s now calculate how much it costs annually to maintain a team that handles requests, serves customers and resolves claims, using data from payroll reports (of course, real costs incurred by the company should also be used here).

Labour costs:

Line 1 – 50 (persons) x PLN 4,500 x 12 months = PLN 2,700,000,

Line 2 – 20 (persons) x PLN 11,000 x 12 months = PLN 2,640,000,

Line 3 – 4 (persons) x PLN 14,000 x 12 months = PLN 672,000.

Again, we have only included labour costs here. The actual costs associated with employment oscillate around as much as x 1.5/2.0 of the basic salary (the aforementioned additional costs associated with employment and full-time staff).

Maintenance costs per customer

Let us now calculate the cost of handling a single customer in each Line:

Handling cost per customer per line – labour costs:

Line 1 – PLN 2,700,000 ÷ 800,000 = PLN 3.375,

Line 2 – PLN 2,640,000 ÷ 320,000 = PLN 8.25,

Line 3 – PLN 672,000 ÷ 800 = PLN 840.

The calculations show that the total annual cost of handling all customers by Lines 1, 2 and 3 is PLN 6,012,000, and this is the cost resulting only from the expenditure incurred on salaries (FTEs).

Inefficiencies and resulting costs in business processes

In this way, we have calculated the labour costs of the customer service department and we already know that the process of handling customer cases costs our company more than PLN 6 million a year (taking into account additional costs, we would probably even reach amounts of the order of PLN 10 million a year).

Knowing the numbers, let’s try to identify inefficiencies in the process, i.e. potential places for automation. This task will be facilitated by a process presented in graphical form, e.g. using BPMN (Business Process Modelling Notation), using the grouping of activities taking place within a single service line by means of a swimlane.

In the figure, it is simply a rectangle in which we place the actions of the unit in question. This is my favourite method of describing a process because of its clarity and legibility, even for those unfamiliar with BPMN.

Let us therefore try to identify the inefficiencies and costs of operations of the various departments:

Inefficiencies in the process. What can we improve and how?

Line 1

Let us turn our attention to the individual swimlanes. The function of Line 1 is mainly to receive requests and handle simple queries and, for more advanced queries, to redirect them to Line 2. The duties also include completing data on the contact and reported case in the system and creating official responses to customers.

All activities, including those carried out in the system, take place manually (and sometimes manually in the system), which offers great opportunities for optimisation. Let us assume that the activities carried out in the call centre department can be automated in approximately 75 per cent of the handling time, a figure selected on the basis of our historical process implementations where we have recorded automation of work at a similar level (higher or lower, depending on the tasks carried out).

This level is influenced by the automation of the tasks of receiving and handling requests, contacting customers, processing queries, completing and sending responses to customers and other activities previously performed manually.

Line 2

This department is characterised by less repetition and thus the tasks that arise require more knowledge or specialised training. Similar to Line 1, activities take place manually or manually in the system.

So let’s assume that around 35% of this department’s tasks can be automated. This means that 35% of the Line’s working time can be saved by automating tasks such as generating documents, corresponding with customers and searching for query items, thanks to access to an AI-powered knowledge base.

This is all thanks to the support of a modern workflow engine and artificial intelligence, complementing the expertise of Line 2 specialists. Obviously, there will still be individual cases that require specialist knowledge, and so redirection to Line 3 experts to provide the right answers to customers.

Line 3

This department is characterised by a lower rate of automation possibilities, due to low repetitive elements or uniqueness of queries. However, individual tasks, such as generating responses based on the information entered into the system, can be fully automated based on the process engine.

In addition, a part of the work of this department can also be supported by an appropriately learned large language model, or LLM (Large Language Model), e.g. when searching for information for particular queries and correlating it with an offer or current legislation.

For more on this type of solution, see the article: Generative AI in customer service processes and analytics.

Rather, in this department, we are talking about speeding up the execution of individual tasks, which allows us to provide faster responses to customers (including very complex queries). So let’s assume the possibility of automating around 20% of the time required to complete activities, and let’s also include in this area the scope related to the acceleration of work resulting from the execution and management of tasks digitally using a workflow engine and AI.

Is it worth automating business processes?

As I am responsible for process digitisation and automation solutions at work, I know the answer from experience with this scale of case processing and can write in advance that: YES, IT’S WORTH IT.

Why? Because digitising processes is de facto saving working time. This is the phrase that best describes process automation. By replacing the organisation’s human resources with advanced programmes, you give your employees the chance to pursue more challenging tasks. This allows current as well as future members of the company to develop and derive greater job satisfaction. Thus, we increase the attractiveness of employment not necessarily by salary alone, but by a package of state-of-the-art tools. After all, every professional driver would like to drive the latest car model (because it’s comfortable, because it has more features, because it’s more enjoyable to work in) and the same is true for IT tools supporting work in other industries.

Previously manual activities can be replaced by applications created using BPMN engines and various AI variants. Using new technologies and changing the paradigm of how business processes are handled will save your company time and money.

Process automation in practice. Calculations

To confirm my earlier words, let’s check the figures and find out how much a company can save in practice through automation. Below we present three calculations, each for a dedicated Customer Service Line. These calculations were created on the basis of previously presented data illustrating the scale of potential savings brought about by the digitisation of business processes.

In addition, the calculations below provide an estimate of the time optimisation required for each activity. In the area labelled “automation possibility”, we take into account the percentage of the time required for each activity that will be automated and therefore saved. This takes costs off our employment in handling the process.

Line 1:

Annual costs: PLN 2,700,000

Potential for automation: 75%

Calculations: PLN 2,700,000 x 75% = PLN 2,025,000 – this is the amount we will save in the first year from Line 1 salaries.

Line 2:

Annual costs: PLN 2,640,000

Potential for automation: 35%

Calculations: PLN 2,640,000 x 35% = PLN 924,000 – this is the amount we will save in the first year from Line 2 salaries.

Line 3:

Annual costs: PLN 672,000

Potential for automation: 20%

Calculations: PLN 672,000 x 20% = PLN 134,000 – this is the amount we will save in the first year from Line 3 salaries.

In Line 3, instead of optimising the department due to low staffing levels, we can gain free space to carry out additional activities, e.g. in the area of further optimisation or space to handle more customers.

Summary:

The total annual savings based on our model could amount to PLN 3,083,400 (2,025,000 from Line 1 + 924,000 from Line 2 + 134,000 from Line 3). The savings come from optimising the time required to handle the assumed number of customers. These can be achieved by reducing the costs of tasks suitable for automation and redeploying employees to tasks that affect profitability, such as customer research or sales activities.

From the amount received, we can deduce the resources worth spending on automating the process. For example, an investment of PLN 5 million in an engine to automate this one process pays back in less than two years.

Costs of implementing automation

In contrast, let us note the following facts:

The costs of implementing processes start at several hundred thousand zlotys, while the most complicated and complex ones oscillate around several million. The first phase of implementation tends to be the most capital-intensive, as it requires configuring the platform and involving a part of the team in the development process, often eliminating technology debt. The automation of further processes will already be based on the implemented platform, so the cost of such implementation will be much lower and the profit will be higher.

Savings from digitisation of processes

Entire processes can be digitised or certain activities can be automated and supported, which will result in accelerated delivery of value to customers and shorter handling of current business processes. Using new technologies in an appropriate, structured and thoughtful way will allow:

• acceleration in the execution of internal processes,
• increased job satisfaction (by eliminating the performance of repetitive tasks),
• the risk of errors to be minimised,
• better access to data and reports,
• a tool for process monitoring and optimisation to be obtained,
• historical data to be returned to,
• repetitive activities to be automated,
• certain tasks to be carried out by AI.

The rate of return is not inconsiderable and after 2-3 years in many cases the return on the investment made begins, and sometimes even sooner. This is due to the possibility of spending less time on the operations carried out and replacing manual activities with those carried out digitally using software. In addition, customer satisfaction with service delivery is increased, thanks to fewer errors, faster response times and availability at unlimited hours, sometimes even at night.

How will the process work after automation?

The graphical look of the process has already been presented above, but let me present the diagram again and briefly describe what could be improved:

Line 1

As you can see, Line 1 has been almost completely automated through the implementation of:

• a workflow engine for handling process activities between steps in the process (stages),
• voice and chat bots with the support of large language models (LLMs) to communicate and converse with customers,
• a decision engine which, on the basis of the information provided by the customer, decides on the type of activity: to respond, to convert further or to redirect to manual handling.

Only about 25 per cent of the cases in the example presented were classified for manual handling, giving the opportunity to reallocate 75 per cent of the resources from Line 1 to tasks requiring much more human intervention. In this way, we eliminate the staffing problems mentioned in the first part of the article, which are affecting an increasing number of organisations.

Line 2

Tasks in this line have also been supported by technology that enables the use of internal information resources. This is a solution similar to a GPT chat, based on the data and historical experiences available in the organisation, which, due to the time span of the occurrence of rare cases, are impossible for a significant proportion of employees to remember (who are limited by their memory or short length of service in the organisation).

The work was supported by the automatic generation of official digital and analogue responses based on data fed from the system, allowing for a faster and virtually error-free response. This results in a significant acceleration of the handling of individual cases due to faster access to knowledge and automatic generation of responses. With these types of improvements, the same or a smaller number of staff will be ready to take on more customer queries.

Line 3

Activities such as contact and external consultations have been placed in a single system, allowing continuity of communication and time management of individual tasks. In addition, the automatic generation of responses based on pre-filled data in the system allows the customer information step to be carried out in a partially automatic manner.

Let’s also remember that all the improvements implemented will themselves be continuously improved, increasing the level of automation in the company.

Does the expenditure on automation pay off?

The annual savings resulting from working time optimisation if the above solutions are implemented amount to PLN 3,083,400, which we will approximate to PLN 3,000,000 for calculation purposes.

So let’s estimate the costs of implementing a solution that has a process engine and processes for customer service, a chat and voice bot based on off-the-shelf AI models, an in-house AI-based search engine, document generators and a decision engine. It is estimated that this type of implementation can consume a budget of between PLN 4 and 7 million. It all depends on the level of technological sophistication of the solutions.

Let us assume that the example implementation cost will be in the region of PLN 6,000,000 and that PLN 200,000 will be the annual maintenance of the proposed solution.

Conclusions

The investment expenditure in this case will start to pay off in the third year of operation of the system. After five years, the company will earn approximately PLN 8,000,000 from the implementation of automation in the customer service process. These are, of course, estimates, but the overriding aim of a project with this level of automation is to generate profits and increase the profitability of the tasks carried out, which also indirectly contributes to competitiveness.

Process digitisation. Summary

As all the above calculations show, the digitisation of business processes entails:

• financial savings,
• the potential to serve more customers,
• opportunities to redeploy teams to more challenging tasks,
• growth in the company’s stock market value,
• improved attractiveness as a service provider,
• improved attractiveness as an employer (no need for monotonous and repetitive tasks),
• full knowledge of the company’s processes.

In addition, the implementation of a process engine (workflow) allows the efficiency of the process to be tracked and optimisation decisions to be taken based on this information, thereby generating additional profits. We will write about this in the next part of the article.