It’s an increasingly common scenario at industrial organizations: forward-thinking managers see bottlenecks and spin up an AI-powered solution. On the one hand, that kind of entrepreneurial mindset is a huge asset. On the other, if enough people build their own AI workflows, your operations will get harder and harder to measure, govern, and maintain.
Or maybe you’re experiencing the opposite: you know you could be operating better with help from AI but you have no idea where to start.
In either case, the question to answer is where your biggest ROI opportunity lies. In this piece, I’ll explain how we help organizations answer that question so that they can confidently build the AI workflows that deliver the best-possible return on their investment of time, money, and resources.
Related: Building the business case: ROI frameworks that secure investment for manufacturing innovation
ROI for AI workflows: impact vs. effort
One thing that’s plagued CFOs in the age of AI pilots is how to measure the impact AI deployments are having on the bottom line. Part of the problem is that most early AI pilots were haphazard. And with good reason! The pressure to adopt and fear of missing out (FOMO) were high. Leaders across industries decided that it made sense to experiment, learn, and figure out the financials later.
We’ve officially entered that “later.” AI tools are facing more scrutiny from CFOs, in part because of reports that show little to no increase in bottom-line performance associated with AI tools.
For an organization deciding which AI workflow to build the challenge is to figure out where the impact of an AI workflow is commensurate with the effort and resources required to build it.
At first glance, the one-off AI tools employees build themselves may seem to fit the bill. But when you zoom out and consider the bigger picture (including scalability, compliance, security, and more), the picture is less clear. Maybe a shift manager built the workflow in a couple of hours, but what happens if, for example, it stores customer data in a non-compliant way?
The good news is that there is a way to systematically assess potential impact vs. effort so you can identify the top-priority opportunity in your organization.
Map what's there to find bottlenecks and opportunities
I worked recently with a supply chain and operation group that serves automotive suppliers. They had exactly the problem I described above: managers across the organization were building mini automations to solve the bottlenecks that most affected them.
If the leadership did nothing, they’d have dozens of slightly different in-house solutions, which had the potential to make measurement, training, and maintenance a nightmare down the road. They knew they had to take action, but they didn’t know where to start. That’s when they called us in.
Our usual process when we’re looking for the highest-ROI opportunity is to walk the floor, so to speak, to get a sense of the current state of an organization’s processes and operations. With this group, we decided to follow one component throughout its lifespan at the company. That meant tracing its movement through four stages: new-customer onboarding, material sourcing, order scheduling and fulfillment, and issue resolution.
When we did this, we were able to identify bottlenecks that affected the entire company. That information illuminated the first half of our ROI calculation: what kind of impact could we have by addressing one of these bottlenecks?
Assess 4 things: desirability, feasibility, executability, viability
Once we had a sense of the opportunity, it was time to plot the effort and resources required to address the various high-impact bottlenecks.To do this, we look at four components of a potential solution:
