Over the past few years, we have witnessed the advance of Robotic Process Automation (RPA) or what we prefer to use more broadly, Rapid Automation (RA), but users need to look beyond the hype and apply this emerging technology effectively. Too often, we are seeing businesses place great emphasis on automation but fail to realise the expected benefits.
What is RA and how does it differ from traditional automation?
Traditional business process automation approaches often do not deliver 100% automation for the processes they cover. Gaps and white spaces remain in the solution for which manual intervention is required to successfully process a transaction. Moreover, these automation solutions generally require complex, costly, and time-consuming integration with legacy systems, Enterprise Resource Planning systems (ERPs), mainframes, and other such systems of records leading to sub-optimal returns of investment. RA can overcome these inefficiencies and integration challenges.
RA is a software program that emulates people’s interactions with software systems such as ERPs, Microsoft Office documents, workflow applications and databases to execute tasks faster and more reliably than humans can.
RA interacts with different software systems at the level of the graphical user interface or presentation layer: the same level as a human user of the system. Existing systems can therefore work together more efficiently, because RA performs some tasks faster and more reliably than humans do. This shifts human effort away from routine processing functions and toward managing exceptions and optimising business processes. One principal advantage is that RA links existing systems without requiring their direct integration. Instead, it applies a variety of familiar user interfaces, such as ERP systems and Microsoft Office documents and databases.
Leveraging automation in business process operations
One area in which RA solutions are helping to drive development is within the BPO industry. Initially, the industry was focused on value drivers like labour arbitrage and economies of scale along with improving process quality, using concepts like Lean and Six Sigma. The current phase of evolution of the industry is characterised by digital technology enablement that capitalises on now mature technologies like mobility, workflow and cloud. The addition of emerging and leading edge tech like RA and cognitive capabilities helps to re-imagine processes and create intelligent operations that can sense, learn and act at scale.
How should companies approach RA?
Robotic automation offers considerable potential for addressing key pain points in traditional “system of records” technologies, such as ERPs. There are still, however, limitations to its usability and impact. Prospective users or businesses need to recognise which types of transactions can be performed well by RA, identify the appropriate sphere of intervention, and form effective plans for using it in a rapidly-changing environment.
Companies often make the mistake of trying to implement RA on broken and suboptimal processes. The reality is that it will only cement the inherent inefficiencies in the system. The right approach is to re-engineer the process initially and combine process optimisation with appropriate operating models and RA technologies to maximise the outcome. Indeed, process optimization adds a disproportionate amount of value to the overall outcome of rapid automation.
While it is critical to identify which processes are the best candidates for RA, it should be seen as just one component of an end-to-end process improvement program. To get the maximum value of RA, the natural place to start is with the global process owner, or the person with overall responsibility for an end-to-end process.
It is vital that sourcing professionals looking to invest in RA understand that it cannot be treated like just another piece of technology. The approach of price comparison on licenses for example to determine who to work with is fundamentally flawed when the tech in question is impacting an end-to-end business process. The lens that should be used is what type of overall business outcome can be achieved through this technology and also which type of provider has the appropriate combination of process expertise, automation technology capability with mature implementation frameworks that can unlock maximum value in the shortest possible time. RA technology in itself is a very small component of the overall value and the real impact comes from the expertise to deconstruct and re-imagine the underlying processes. It is about the IP that can accelerate deployment and realize the best business outcome faster.
The benefits can be huge including cycle-time reduction of up to 99 percent, more than 50 percent improvement in productivity along with one hundred percent accuracy, and therefore significant improvement in both risk and compliance.
So what should sourcing professionals focus on?
As robotic automation matures, sourcing professionals need to focus on three principal factors that will drive business impact:
1) Choosing the right scope and processes. Businesses must look at re-engineering the process first and then combine process optimization with appropriate operating models and RA technologies to maximize the outcome. To realise benefits faster, businesses should only look at automating work that has already been industrialised and optimised.
2) Investing in the right approach. RA is not just about driving short term cost and productivity improvement. Businesses need to look at this as part of their overall value creation process and as one of an end-to-end suite of tools, capabilities and assets that can help accelerate business transformation.
3) Leveraging and multiplying the full power of this rapidly changing technology. RA solutions embed additional component technologies to augment scope, capability and therefore impact. These technologies can be around natural language generation and processing, big data analytics, or advanced cognitive capabilities.
A few concluding thoughts
Pulling this altogether requires cutting across traditional boundaries and ideally uses an end-to-end holistic approach. The key is to automate intelligently while balancing automated and human processes. RA can drive significant impact on cost, productivity, time to market and compliance, but this requires an increased reliance on management by exception, which in turn needs strong governance and compliance check points.
Ultimately, robotic automation is no panacea and significant limitations still exist, especially regarding unstructured data formats. The technology is continuously evolving and improving in areas like non-digital input types, machine learning, and natural language. The reality we face today is that RA needs to be addressed as part of a broad briefcase of tools. The use of these tools must be balanced with more direct forms of automation to get the best mix. RA builds greater visibility into processes that span enterprise functions and enhances information feedback loops in terms of the speed, accuracy, and volume of data. This feedback loop empowers enterprises to sense and learn from the outcomes of their actions at scale, resulting in business operations that are truly intelligent.
You can find out more about Genpact's work with Rapid Automation here.