Month: July 2018

Five Keys to Unlocking the Benefits of RPA for Enterprises | Sherpas in Blue Shirts

My recent meetings with the top RPA vendors made it clear that RPA is shifting into new gears of adoption and implementation. But the vendors also made it clear that the true promise of RPA is getting lost in flashy headlines and hype-ridden marketing messages.

Here are my five recommendations for how enterprises can drown out the noise and harness RPA’s real benefits.

Experimentation is Over – The Value is Real

The question “Should I pursue RPA?” has been answered and is widely being replaced with “How can I leverage RPA to gain the most value?” As you see in the graphic below, the benefits of RPA are very real. Nearly every enterprise we have spoken with is seeing real savings – typically around 30 percent lower cost and 30-50 percent improvement in accuracy, cycle time, staff productivity, etc.

RPA Value blog image

Forget about RPA Vendors’ Pitches

Despite all the hype, enterprises must remember that RPA vendors are not selling a digital workforce; they are selling software that can speed up, improve, and support many processes currently performed by staff members. While this is sophisticated software, it’s not a physical entity or an army of robots. It can be tempting to get lost in the imagery, but enterprises need to be careful not to lose sight of what they are getting. Otherwise, they can be left with the feeling that vendors have overpromised and underdelivered.

Ignore the Buzz Words

From OCR to NLP to Intelligent Automation, there’s no shortage of RPA buzzwords. But the labels themselves don’t really matter. What does matter is the ability to identify processes that are using precious staff resources, limiting operational improvement, or diminishing the customer or employee experience. Enterprises should start with the process they want to improve and then approach the vendor with that specific need as the starting point in the context of their overall automation – including and beyond RPA – journey.

Focus on the Operating Fundamentals

The basics of building an enterprise automation capability can seem amazingly easily…until it becomes obvious that it’s not. Some enterprises undoubtedly acquire robots for simple plug-and-play automation. But when mission critical processes come into play, serious and complex issues – like enterprise-grade security and business continuity – come into play and must be carefully and thoughtfully addressed. Don’t allow these issues to become barriers to RPA adoption (as many enterprises do), because, if well implemented, the benefits far outweigh the risks.

Automation Tools are a Must for Business Growth

Automation tools can help enterprises tackle the labor shortage challenge by making their existing teams more productive and retaining key employees by offering opportunities to perform higher-value work. Although cost savings are important, an automation-augmented workforce is key to competing and excelling in the marketplace.

To help you avoid getting caught up in the industry hype around RPA, we’ve created a simple graphic that describes the four key dimensions you should be thinking about. This enterprise automation analysis framework looks beyond vendors’ marketing pitches and addresses questions based on opportunities from your point of view, including:

  • Business problem complexity – how big and complex is the business process?
  • Rate of operational improvement – how much of a business process improvement do we want to see?
  • Solution/technology investment – which of the many different automation solutions should we deploy (considering investment and benefit)?
  • Operational execution – how do we best implement in your organization?

RPA Framework blog image

At the end of the day, however you choose to move forward with RPA technology, start by considering your enterprise’s use cases and business requirements. Then, build the business cases to support them. And then set your automation team loose on an increasingly exciting new set of capabilities.

Click here to read more of our RPA thought leadership

View a complimentary abstract of the Enterprise RPA Adoption | Pinnacle Model™ Analysis

CCAP: Leading with CX in a Digital World — July 25-26 | Event

Everest Group is once again the featured Knowledge Partner of the 2018 Contact Islands conference, “Leading with CX in a Digital World,” presented by the Contact Center Association of the Philippines (CCAP).

Managing Partner Eric Simonson and Research Partner H. Karthik will be key speakers during the event.

Eric will lead a session titled, “The Empowered Customer in the Age of Digital Care”
Session summary: Industries across the globe are facing profound paradigm shifts driven by new business models, supported by innovative, disruptive innovations. Amidst the changing business landscape, the focus on customers has become even more critical than ever before. This session aims to build a better understanding of the “new-age” customer and their expectations, focusing on both existing customer segments as well as millennials. The session re-inforces the importance of staying focused on customers while in the midst of adopting new models and undergoing transformation.

Karthik will moderate a session titled, “Gearing Up for the Hybrid Workforce: Humans + Machines”
Session summary: Next gen technologies such as AI, automation, and advanced analytics is changing the way companies operates. As humans and machines work more closely and collaborate, processes can become more fluid and adaptive and help organizations become more innovative and profitable. This session brings in the views of the leading industry voices on how they are getting ready for this shift and the kind of the steps they are taking, including the changes coming to the overall CX approach. Further, it explores how the collaborative Human + Machine service delivery model will enhance outcomes and result in more impact than ever before.

When

July 25-26, 2018

Where

Shangri-La’s Mactan Resort and Spa
Cebu, Philippines

Speakers

Eric Simonson, Managing Partner, Everest Group
H. Karthik, Partner, Research, Everest Group

Learn more

Analytics Experts, Data Scientists in Demand | In the News

DEMAND for data scientists and analytics experts is on the rise as contact center companies embrace complex tasks.

In a press conference yesterday, Contact Center Association of the Philippines (CCAP) chairman Benedict Hernandez said the country has to play catch-up in terms of producing talents who are qualified to handle modern call center jobs as more industries cement their footing in the digital economy.

H. Karthik of the Everest Group said the supply-demand challenge is not peculiar to the Philippines as demands of customers globally are rapidly changing.

Karthik cited three trends happening in the global market—increased use of analytics, shift to higher-value jobs, and the rise of automated transactions.

Read more in SunStar

How Banking is Adopting and Using AI Technology | In the News

The pace at which companies are investing in artificial intelligence (AI) continues to gain momentum and the financial sector is not immune to this trend. According to research by global management consultancy Accenture, banks that invest in AI and human-machine collaboration tools could boost their revenue by over a third (34 per cent) by 2022.

Robotic process automation (RPA) that uses cognitive AI is being deployed by banks to improve operational efficiency and reduce costs, and many large finance firms are already seeing benefits.

Therefore it’s not surprising that, according to data by analyst firm Everest Group, banks and financial firms account for 40 per cent of the RPA independent software vendor market.

Read more in IDG Connect

GDPR Compliance – Can Automation Save the Day? | In the News

With its implementation in May of this year, GDPR introduced one of the most stringent and comprehensive regulations in the world today. And with fines for noncompliance of 20 million euros, or 4% of annual turnover, companies cannot afford to take the regulation lightly. But compliance itself is costly. What to do? Robotic process automation – or RPA – may be the answer! With its ability to manage repetitive, rules-based tasks, RPA can help reduce administrative costs and avoid processing errors…and companies might actually realize some additional unexpected benefits as well.

Read more in Intelligent Sourcing

Advice for buying or building a digital platform | Sherpas in Blue Shirts

As digital technologies mature and become applicable, they present a tremendous opportunity for companies to rethink and rearchitect their business to create better client experience, better quality results and lower costs. These opportunities are broad and extensive. At the core of all digital transformations is the assembling and perfection of a digital platform. But companies need to better understand what’s involved in digital platform. Whether the objective for the platform is as grandiose as transforming an industry or as mundane as improving a mailroom service, many companies make a big mistake when looking to build or buy a digital platform.

Let’s consider two examples of digital platforms aimed at transforming the companies’ operations and costs. A construction company built a digital platform to improve productivity and safety of several hundreds of subcontractors. The firm used geofencing technologies and implemented RFID technology and sensors into the workers’ helmets. The technology alerts supervisors if workers enter a zone they are not authorized to enter.

In another initiative, the company built a platform to improve utilization of its materials and equipment moved to different locations and even different countries. The objectives are to increase efficiencies and better monitor the life cycle of these items. RFID technology and sensors placed on the equipment and materials is, again, a key technology in the platform.

 

US P&C Insurers, Hammered by Natural Calamities, Leverage Technology to Lower Costs, Improve Customer Experience—Everest Group | Press Release

Other profitability drivers for Property & Casualty Insurers include product innovation, underwriting excellence, fraud control and effective capital management

U.S. property and casualty (P&C) insurers, hammered in 2017 by one of the worst years for natural disasters in recorded history, face uncommon margin pressures and are struggling to find strategies for profitable growth. U.S. P&C insurers are not alone in this struggle as insurers throughout the world face additional margin pressures such as modest growth in investment income, continued geopolitical uncertainty, increasing customer expectations, the rise of non-traditional competition from InsurTechs, and heightened complexity of risks.

Nevertheless, Everest Group counsels that P&C insurers can convert challenges to opportunities. Specifically, P&C insurers can employ these five key strategic levers to achieve profitable growth:

  • Product innovation, particularly in coverage, pricing and services
  • Underwriting excellence and fraud control, especially using predictive analytics, artificial intelligence (AI), Internet of Things (IoT) and blockchain
  • Effective capital management, such as investing in profitable segments, targeting low-risk customers and developing greater capital self-sufficiency
  • Leveraging technologies (such as mobility, telematics, automation and AI, drones and blockchain) to expanding digital use cases to middle- and back-office operations
  • Delivering excellent customer experiences through omnichannel services and self-service, straight through processing (STP), on-demand products and bundled services, and faster and simpler customer-facing processes.

“Property and casualty insurers are facing macro and micro challenges that make it difficult to achieve profitable growth,” said Skand Bhargava, practice director, Business Process Services, at Everest Group. “As a result, they are expanding their partnerships with BPO providers from just outsourcing of administrative tasks to more value-added services delivered through a blend of operational understanding, technology knowhow, and domain expertise.”

The P&C insurance business process outsourcing (BPO) market consistently grew at approximately 13 percent from 2015 to 2017, and the market growth is only expected to accelerate in the future as P&C insurers seek strategies for profitable growth in a heavily dynamic market.

A few BPO service providers are stepping-up to assist insurers in mitigating their present challenges. Service providers are leveraging domain expertise for consulting and design thinking services, technologies such as automation for increasing operational efficiencies, and analytics for greater value-addition. These are over and above the usual cost savings that are associated with an outsourced delivery model.

Everest Group explores these findings and others in a recently published report: “Property and Casualty (P&C) Insurance BPO: Embracing Growth Through Digital Empowerment.” This report provides comprehensive coverage of the global P&C insurance BPO market, including adoption trends across geographies and buyer size, factors impacting the market, key solution characteristics, emerging trends and service provider landscape.

***Download a complimentary abstract of the report.*** (Registration required.)

CIOs Struggle with Gap in Digital Transformation Expectations and Delivery Capabilities | Sherpas in Blue Shirts

As part of our Pinnacle Model™ methodology and benchmarking, Everest Group recently conducted a study of over 200 companies on their digital transformation readiness. The study found companies’ boards of directors typically believe digital transformation is about technology, and they typically under-estimate the cost and expect results in months, not years. Those expectations are a huge gap away from the reality challenging CIOs and senior leaders leading the digital transformation. CIOs participating in our study revealed their companies were unprepared, under-funded and under-supported as to the tools, investment and commitment required to succeed. In this blog, I’ll share how to effectively communicate to your company the requirements for digital transformation to succeed.

Why Is There a Huge Gap?

The gap between expectations and delivery capabilities is because digital transformation is fundamentally different from companies’ past experiences with transformation. The technologies are disruptive and necessitate changing the organization, talent model, mind-sets, policies, processes and procedures – basically, the entire business model. Those changes are not easy. They don’t come all at once. They’re not completely known at the outset. And they unfold over a multi-year journey.

Peter Drucker advised, “If you want something new, you have to stop doing something old.” But the depth and breadth of necessary changes and the required commitment and investment for digital transformation are complicated to explain. They are hard to understand.

The digital journey requires far more resources, support, commitment and investment than anyone wants to believe. Digital technologies also take far longer to implement than people expect. For instance, in Robotic Process Automation (RPA) technology, a company can put a robot up quickly to create process improvement; but getting significant value involves more than that. Sure, a company can automate a function. But until the executives rethink the process that the robots will perform, they cannot create a meaningful improvement or breakthrough performance.

So, it’s no wonder that the boards don’t understand the extent of what is required to successfully complete a digital transformation journey. They also don’t understand that they need to fund IT transformation at the outset so that IT can successfully support the digital transformation.

As a result, most digital transformation initiatives fail (70%, according to a 2013 McKinsey & Company study. Many participants in Everest Group’s Pinnacle study revealed that, even when they understood the journey, they could not communicate it to their board, could not get funding, could not build support for it, and thus could not drive the change necessary to get it done.

How to Communicate Digital Change Requirements to Your Company

From our Pinnacle Model study, we developed an assessment vehicle (a 30-minute questionnaire) from which your company can compare its digital readiness against the broader population and against the market leaders (the Pinnacle Enterprises™). Together with a four-hour workshop, you’ll have the tools that will allow you to identify gaps, create learnings, understand what things you could do differently to improve your company’s readiness and performance and well as build road maps that allow you to systematically mature your digital readiness.

Learn more about our digital transformation analyses

Executives that have gone through the assessment and workshop tell us it created a great tool for communicating with their board of directors and the rest of the business about the support, resources and investment necessary to allow for successful digital transformation.

It is also a supporting budgeting tool that allows you to demonstrate the value against the cost, build support for the investment required to mature digital readiness and communicate the value that the IT organization will be able to achieve or support by increasing its digital readiness.

There’s a startling fact in the 2013 McKinsey study I cited earlier: Of the “successful” 30% that didn’t report their initiatives as failures, “success” was described as either breaking even or finishing the program but not delivering the anticipated business results. Of course, no company wants to undergo the challenge, effort, and expense of transformation only to break even or remain in the same relative competitive position.

Harvard Professor John P. Kotter’s study of 100 companies that underwent transformation initiatives found more than 50% failed in the first phase (getting organizational commitment and cooperation for the initiative). The Pinnacle assessment, workshop and communication tools are very helpful in addressing these issues.

Enterprise Adoption of RPA Exceeds 100% Growth in 2017, Buoyed by New Buyers of All Sizes, Industries—Everest Group | Press Release

High business value, low risk, sophisticated vendor offerings to propel 90% RPA market growth annually

Robotic Process Automation (RPA) continues to expand its reach and client base as more enterprises become aware of the benefits of the technology. Enterprises of all sizes and industries are testing the RPA waters, eager to keep pace with their peers in the technology adoption curve. Enterprise adoption of RPA, as indicated by the number of enterprise clients served by independent RPA vendors, achieved a 105 percent growth rate from 2016 to 2017, according to Everest Group.

“RPA offers many benefits and few risks,” said Sarah Burnett, vice president at Everest Group. “Using RPA, companies can reduce costs and achieve faster processing and improved quality. The risks are low, because the technology is non-invasive and easily remediable. The market is in its early stages of high growth and adoption, with most enterprises testing the water at this stage.”

Among current RPA deployments, desktop automation (attended RPA) is the most prevalent, followed by server (virtual machine) deployments (unattended RPA), which typically sees robots run according to pre-defined schedules or process related automatic triggers. Much less common is the use of cloud for running RPA deployments, but adoption of this model is increasing as the market grows.

RPA software typically comes with centralized robot management and robot performance analytics. More advanced features include auto-scaling, dynamic load balancing and context awareness. At the nascent stage of emergence is cognitive RPA, which is RPA integrated with artificial intelligence technologies, robot voice and vision interfaces, predictive and prescriptive analytics, automation of judgment tasks, and self-managing and self-healing robots.

“We expect an extrapolated high-growth curve for the next several years as vendor offerings get more sophisticated,” added Burnett. “For instance, we already see vendors building out capabilities in the areas of computer vision, pre-built automations, self-healing systems and auto-scaling systems, just to name a few.”

The RPA software market overall witnessed a growth of 92 to 97 percent in 2017 to reach US$480 million to $510 million. The market is expected to grow between 75 and 90 percent annually up to 2019.

These findings and more are discussed in a newly released Everest Group report, “Robotic Process Automation (RPA) Annual Report 2018 – Creating Business Value in a Digital-First World.” This research explores RPA market size and growth, buyer adoption trends and key learnings from early adopters, RPA solution characteristics, technology trends, the RPA technology vendor landscape, and the future outlook for 2018-2019.

Some of the findings are:

  • Small- and medium-sized enterprises have accelerated the pace of RPA adoption and now together account for a major portion of the market.
  • Industry-specific processes continue to see the highest adoption of RPA.
  • North America continues to be the largest RPA market; however, Europe and the United Kingdom, together, accounted for the highest growth among major markets.
  • Buyers generally have a high satisfaction level with RPA vendors, but they expect the vendors to improve their support, analytics, and cognitive capabilities.
  • The majority of RPA buyers are still in an early adoption phase, as they continue to test the technology before scaling up.
  • Attended RPA has a higher adoption maturity and installed base in terms of licensed volumes. However, unattended RPA is driving the highest growth due to cloud-based deployment.
  • Automation Anywhere, Blue Prism, and UiPath are the top three vendors in terms of RPA license revenue and account for over one-third of the total market revenue.

***Download a complimentary abstract of the report.*** (Registration required.)

Infosys Creates a Unit to Respond to Call of the Telecom Billions | In the News

Infosys chief executive Salil Parekh has carved out a separate business that will increase focus on telecom companies that look to leverage their network and subscriber base to transform themselves as content providers and retain their customers.

“The communications services segment is poised for strong growth over the next few years and will likely emerge as a strategic segment in which strong performance will be essential,” said Peter Bendor-Samuel, chief executive, Everest Group, a global IT research and advisory firm. He added that implementation of 5G networks itself would be a big opportunity, which will only increase with the convergence of “telecom and media”.

Read more in The Economic Times

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