How to Lower Admin Costs by Back Office Automation?

Does your administrative work cost a lot? Are you actually willing to trim the budget of your administrative services?

Well, it’s a common problem, and many times, you feel helpless for not being able to control expenses on backend operations. Streamlining and optimizing resources will certainly help, but to a certain extent. For witnessing a big difference, embrace back office automation. This is one of the most innovative ways to automate repetitive and lengthy tasks of your business. Consider the case of IBM, which has deployed RPA to support customers while automating complementary data entry and query solutions. It not only reduced response times but also the cost.

But before understanding how to lower the cost, let’s discover the services that need proper streamlining for automation.

What Are Back Office Services?

Services like data entry, onboarding, people management, support functions, etc., are collaboratively called back office operations or services. These are extremely needed to keep a business up and running smoothly. In a single sentence, back office automation services are operations that do not involve direct customer interaction. Typically, these services cover the following areas:

• Data entry and management 
• Payroll processing 
• Inventory management 
• Accounting and bookkeeping 
• Human resources (HR) operations 
• Compliance and reporting 

These are non-negotiable operations that require a significant investment of time, resources, and money. Automation is the most welcoming solution that can actually minimise this investment.  

The Role of Automation in Reducing Admin Costs

The word “automation” evokes software and technology in mind. Certainly, it requires them to minimise human intervention. Simultaneously, the beneficiaries witness substantial cost savings and operational efficiencies. How? Let’s check out below:

1. Eliminating Manual Data Entry

Manual data entry requires in-house teams and on-premises resources, which cost a lot. But still, the possibility of errors is always there. On the other hand, Robotic Process Automation (RPA), which is an automatic method, can handle a bulk of data entry tasks with accuracy and precision.

OCR technology, for example, is able to recognise and then extract data from scanned files. Being an online method, it does not burden the manual workforce to record data. 

2. Streamlining Payroll and Accounting

Payroll processing and accounting are critical processes. Specific professionals are hired to do these labour-intensive jobs. By integrating automation for payrolls, calculating salaries, deductions, and taxes will be like a walkover. Accounting software like Xero and Zoho Books can exponentially reduce time for reconciling transactions, generating financial reports, and even filing taxes. Overall, the burden of the finance management team is offloaded with the least errors.

3. Optimizing Inventory Management

The e-commerce industry, including retailers & wholesalers, has to manage inventory. Many a time, this task proves a nightmare for both the stock providers and customers. Automation of these inventory systems can alleviate the pressure of monitoring stocks in real-time, generating POs or purchase orders when the supplies are low. Furthermore, anticipating demand through the history of purchases cuts down on the effort. Simply put, automation mitigates the risk of missing orders, as it digitally optimises inventory levels. This practice further reduces waste, and hence, the storage costs lower.

4. Enhancing HR Operations

The Human Resource or HR department finds onboarding, leave management, and performance tracking unmanageable manually. As the tools like Deel, Onboarder, Zenefits, or WorkBright automate these tasks, the team can focus on compliance. They ensure following and guiding new hires effortlessly. Likewise, HR management systems can automatically manage leave requests.

5. Improving Compliance and Reporting

With the advent of digital data trends, their governance has become extremely vital. The inception of GDPR, the DPDP Act, and HIPAA are some of the examples that regulate the ethical use of data. Automatic compliance tools can replace human beings by monitoring changes in regulation. It helps in abiding by compliance rules and generating reports without human interference. This is how the possibility of penalties narrows down.

Benefits of Back Office Automation

With automation tools in place, it is easy to streamline the effort in innovative activities. The advantages of automating back office services are way beyond minimising costs. Let’s introduce you to these benefits:

1. Increased Efficiency

Just compare the result of a man versus machines. Software are machine-run tools that can leave humans way behind in terms of efficiency. The freed-up main resources can be aligned on higher-value tasks. Their innovation can evolve solutions that can speed up processes, improving productivity, turnaround times, and efficiency.

2. Enhanced Accuracy

With minimum human interference, automation eases the strain of handling flaws and errors in data. The accuracy eventually guides in making reliable decisions that actually achieve expected results. For instance, flawless data in mining evaluates models or patterns that actually automate repeated tasks.

3. Scalability

With affordable automation tools, scaling up or down the workload seems no longer stressful. The back office operations run smoothly.

4. Better Decision-Making

Analysis is also a back office task, which can take the weight off from manual data entry and management teams. Even HR specialists can also drive innovation for competitive advantages.

5. Employee Satisfaction

With diminished responsibilities and an automated workflow in place, back office experts can drive their intelligence toward more meaningful work. It ultimately leads to a higher level of satisfaction and lowers the attrition rate.

Step-By-Step Guide to Implementing Back Office Automation

Now that you recognise how automation makes things more manageable, let’s break down the process of its implementation.  

Step 1: Identify Pain Points

Discovering pain points is the key to identifying the most time-consuming, error-prone, repetitive, and costly processes in the back office. It can be data input, management, IT support, or even talent acquisition, where automation will show the greatest impact.  

Step 2: Choose the Right Tool

As the busiest activities are highlighted, explore a series of tools that can address the pain. It can be related to HR, accounting, inventory, shipping, customer support, or anything. Simply choose the right tools that can easily align with your actual business requirements. Finally, integrate them for seamless production and desirable efficiency.

Step 3: Train Your Team

Deploying tools wins the half battle. Ensure that the stakeholders or employees are able to handle them effectively. For example, installing Office 365 can reduce the dependency on insecure servers, and managing data becomes way easier without the need for a cloud management expert.

Step 4: Monitor and Optimise 

Just the deployment of the tool is not sufficient. Continuously monitor how the tools are working. Consistently gather feedback on their performance from employees and then do the needful for optimal results.

Conclusion 

Back office automation is no longer a luxury. It’s a necessity for businesses looking to stay competitive in today’s digital age. By automating repetitive and time-consuming tasks, organisations can significantly lower administrative costs, improve efficiency, and focus on strategic growth initiatives. Whether you’re a small business or a large enterprise, the time to embrace automation is now. Start by identifying your pain points, choosing the right tools, and empowering your team to make the most of this transformative technology.