Digital Business Services
Automate or Standardize
"To automate or standardize" a relevant question in today's business process management resonates closely with a 400-year-old soliloquy from Shakespeare - "To be or not to be".
Robotic Process Automation (RPA) has gone mainstream with most global 2000 organizations implementing or in plans of implementing some form of automation. This phenomenon is reflected by the market valuations of popular RPA platforms such as- Automation Anywhere valued at $1.8 Billion, Blue Prism at £1.2 Billion and UIPath at $3 Billion.
Given that RPA and Artificial Intelligence (A.I) have the potential to reduce effort anywhere from 20%-70% depending on the process. Functions like finance, HR, Procurement, Sales and Marketing etc. Who have outsourced parts or all of the process to in-house Shared Service Centers or third-party business process outsourcing providers, are being posed with this question - "Why bother with any outsourcing and all the Standardisation and Harmonisation initiatives? Should we not just automate our processes instead?"
RPA is defined by an article in CIO.com as an application of technology, governed by business logic and structured inputs, aimed at automating a business process. Using RPA tools, a company can configure the software or a "robot" to capture and interpret applications for processing a transaction, manipulating data, triggering responses and communicating with other digital systems. RPA scenarios range from something as simple as generating an automatic response to an email to deploying thousands of bots, each programmed to automate jobs in an ERP system.
The above definition is a reasonable way to look at what RPA can do, but can you just pick up any process and start automating it? The answer to the question depends on how mature the process is.
Before we start any RPA engagement, it is important to look at the following aspects:
A process assessment is required to determine whether the process where RPA is being applied is really the correct candidate for automation. Conventional thinking would say that any process which requires judgment is not a good candidate for Automation but it is worth re-looking at the process again to see whether they are really requiring judgment before an action is taken
Evaluating the End to End process
While considering business process automation, it is important to re-assess the end to end process. When RPA implementation is considered in a particular subprocess, it can bring other process improvements which could impact other parts of the process. It can enhance a particular subfunction but negatively impact the overall process.
For example In Payment processing, there are typically at least 2 or 3 different parties looking at the calculation behind the payment as a control. If you implement RPA there is no need to have these multiple steps.
Typically most organizations measure a number of metrics (Key Performance Indicators/Service Level indicators) which are used to measure effectiveness and efficiency. A lot of companies are now starting to measure Experience. Whichever metrics are being used, it needs to be analyzed to detect opportunities for redesigning and automationg business processes.
Another big factor that most people miss out on RPA implementations is that it needs to be maintained. If you automate a process without really looking at standardising or improving the process, any changes will increase the cost of your automation in the form of changes that may occur later. People tend to forget this in calculating the benefits of RPA.
Hence, when a process is automated without standardizing or improving the process there will be an increase in the cost of automation in forms of changes and updates that may occur in the future. This factor is often overlooked while calculating the benefits of an RPA project. Talking about the benefits of RPA, the pricing models of most RPA platforms are difficult to understand for most people and more on that in a later blog!
In conclusion, a process cannot be randomly picked for automation, it needs to be analyzed and most importantly it needs to be fine-tuned before it can be automated. Standardization and automation go hand in hand.