When NOT to Automate In A Small Business

Introduction

Every business, big or small, relies on a network of processes, both explicit and implicit. These are the actions we take to achieve specific goals, from attracting new leads to following up with clients or creating blog posts. But often, these processes become ingrained by habit rather than design, leading to a chaotic and inefficient operation.

This inefficiency can be tackled in several ways, and automation is a popular solution. But before you jump straight to automating everything, it's important to understand what a process and a system are, and how they work together.

Processes, Systems, and How They Work Together

A process is a series of steps that produces a specific outcome, adding value to your business. Think of it like a recipe with each step leading to a finished product. Common processes include generating leads, onboarding new clients, or managing social media content.

A system, on the other hand, is the collection of tools and procedures used to execute a process. It's like the kitchen equipment you use to follow the recipe. Customer Relationship Management (CRM) software is a system that manages client interactions, tracks progress, and provides insights into marketing campaigns.

Initially, businesses might use free online tools to build their systems. As needs grow, these systems become more sophisticated. The key takeaway is that every process has a corresponding system, with each step in the process requiring a specific action within that system.

Here's the challenge: as processes and systems get more complex, the time and effort required to operate them also increases, often exponentially.

Calming the Chaos: Optimizing Your Operations

There are three ways to streamline your processes and get a better return on investment (ROI):

1. Process Optimization: This involves reducing the number of steps or improving existing steps within a process. Streamlining your onboarding process for new clients is an example.

2. System Optimization: This focuses on improving the system itself. It could involve switching to a new software program or utilizing existing software more effectively.

3. Automation: This involves using technology to automate specific tasks within a process, reducing manual work.

Challenges for Small Businesses

Small businesses often start out scrappy and lean, with limited resources. This can make it difficult to take a step back and implement a systematic approach to how things are done.

As the business grows, time and resources become even more valuable. The negative impacts of disorganized operations, like inefficient processes and complex systems, might not be immediately apparent. But eventually, the stress and frustration will start to show, hindering your ability to focus on strategic growth.

The Allure of Automation

Automation can be a tempting solution when your operations become chaotic. The gains can be significant – a task that takes four hours manually can be reduced to one or two hours with automation.

Additionally, automation avoids the potentially painful process of re-evaluating and redesigning your existing workflows. The decision to automate, however, is not just technical; it's also a human decision that challenges our skills and experience.

The Key Metric: Return on Investment (ROI)

Before automating anything, consider the ROI. If a task takes four hours a week and costs $70,000 annually to complete, is the cost of automation truly justified? It's the classic programmer joke – spending eight hours to automate something that only takes a few minutes every week. Just because something can be automated doesn't mean it should be.

To Automate or Not to Automate?

Remember, you have other options besides automation – process improvement and system optimization. These can often yield significant gains without additional investment.

Simplifying your tools or finding ways to streamline a four-step process into a single step are examples.

Conclusion

Automation is a powerful tool, but it should be used strategically with an eye towards ROI. By understanding the interplay between processes, systems, and automation, small businesses can create efficient operations without overspending valuable resources. Remember, automation is just one strategy in your overall toolbox for creating order and achieving growth in your business.