There is a famous XKCD comic that calculates whether automation is worth it based on time saved.
But the real calculation is more nuanced. Time saved is only one variable.
Here is the true break-even analysis for automation.
Real example: This calculation influenced how I built my Document AI Starter.
The Classic Formula (Time Saved)
The traditional logic:
- Manual task takes 5 minutes.
- You do it 10 times per week.
- That's 50 minutes/week or ~43 hours/year.
If you can build an automation in 20 hours, you break even in 6 months.
But this ignores several hidden costs.
Hidden Cost #1: Maintenance
Automation isn't "build once, run forever."
- APIs change.
- Dependencies break.
- Edge cases emerge.
I estimate 10-20% annual maintenance cost on top of the initial build.
So that 20-hour automation actually costs 22-24 hours per year to maintain.
Hidden Cost #2: Error Reduction
Manual work has errors. Automation (when done right) doesn't.
What if a typo costs you money?
- A manual invoice entry error might cost $500 (wrong payment amount).
- An automation might mis-parse a document, but you can add validation rules.
If automation prevents even one costly error per year, it's already worth it.
Hidden Cost #3: Cognitive Load
The invisible cost of manual work is mental burden.
If you have to remember to run a task every Monday at 9 AM, that's cognitive overhead. If the task runs automatically, you can use that mental energy elsewhere.
The Adjusted Formula
Here is the updated break-even calculation:
ROI = (Time Saved + Error Cost Avoided + Cognitive Load Freed)
- (Build Time + Annual Maintenance)
Scaling Cost
Manual work scales linearly with volume.
- 10 files = 50 minutes.
- 100 files = 500 minutes (8.3 hours).
- 1,000 files = 83 hours.
Automation scales horizontally (close to zero marginal cost).
- 10 files = 5 minutes.
- 100 files = 10 minutes.
- 1,000 files = 30 minutes.
The break-even point accelerates with volume.
Conclusion
Don't just ask "How much time will this save?"
Ask:
- How much does an error cost?
- How much mental bandwidth will this free?
- What's the 3-year cost, not just the upfront cost?
Automation isn't always worth it. But when it is, it's exponentially worth it.
