How to Calculate the ROI of AI and Automation

Step 1: Work out what the task costs today

Multiply how often a task happens by how long it takes and what an hour of that person's time costs you. Time it for real rather than guessing, because people tend to underestimate routine work.

For example, a task done 20 times a week that takes 15 minutes is 5 hours a week, or about 250 hours a year. Multiply that by the hourly cost of the person doing it.

Step 2: Be realistic about the savings

AI rarely removes a task completely. Someone still needs to review the output and handle the cases it gets wrong. Estimate the time that remains after review, not just how fast the AI produces something.

If the 15-minute task becomes 5 minutes of review, you've saved two-thirds of the time, not all of it.

Step 3: Count every cost

• Setup and integration work.
• Subscriptions, per-user fees, and usage-based charges that grow with volume.
• Your team's time to learn it and adjust their process.
• Ongoing maintenance when tools or processes change.
• Review time, which never fully goes away.

Step 4: Compare over a year

Put the yearly time savings, in money, next to the first-year total cost. If the savings comfortably exceed the cost, run a pilot to check your assumptions with real numbers. If it's close, look for a bigger or more frequent task.

Remember what doesn't fit in the math

Some benefits are real but harder to count: faster replies to customers, fewer errors, and people spending time on work they're good at. Note them, but make sure the decision still makes sense without them.