time to build automation < (time to perform without automation x number of times task performed without automation)

Today I happen to learn the above formula and wanted to share it to the readers.

So basically, according to the formula, it is best to automate only if we can build the automated system in the time less than what it would have taken without automation. Fairly simple mathematics.

Let’s get into an example.

Let’s say an e-commerce company is manually entering the customer details after the order is received. On average, the company receives 50 orders/day and for each order, staff would take 5 minutes.

ie,

50 * 5 = 250 minutes = 3 hours and 10 mins /day

If we assume to automate this task it would take 5 days, then

5 days / 250 mins = 5 * 24 * 60 / 250 = 28.8

That means the company would be benefited after the 29th days because of this automation process.