6 Reasons Enterprises Are Adopting Smart RPA | Market Insights™
April 29, 2019
Factors driving the adoption of Smart RPA among enterprises
Factors driving the adoption of Smart RPA among enterprises
IVAs can act as a unified user interface layer for multiple disparate systems that have distinct backends and enable them to work together
RPA company Blue Prism has announced a string of new products, including Decipher and has secured new strategic alliances. But the RPA market is growing fast, is it enough?
Decipher is OCR software with an AI twist, or maybe, a bit more than a mere twist. But Blue Prism also works closely with OCR company Abbyy. How will Decipher affect the relationship with Abbyy, asked Sarah Burnett, distinguished analyst at Everest Group at the press and analyst conference accompanying the Blue Prism World event? “As a company, we don’t want to go and re-invent lots of technologies just so that we can say we do this stuff,” responded Dave Moss, Blue Prism’s CTO. He said that Decipher has been designed in such a way that “you can plug products in from other vendors into the workflow.”
Read more in Information Age
Robotics process automation, or RPA, is becoming big. And this month, RPA is our main theme. Information Age talks to three of the top players: Blue Prism, UiPath and Automation Anywhere. So here we begin RPA month by comparing and contrasting.
Is there a danger that some companies are implementing RPA, without fully understanding what it can offer, as a result they may be left disappointed?
Guy Kirkwood, UiPath: “We do not presume to know everything, which is why we recommend everyone implementing RPA follows a step-by-step guide to implementation, produced by analyst firm Everest Group. This Playbook is available free from UiPath.”
Many enterprises that have used Robotic Process Automation (RPA) have seen the power of digital transformation, even if only in a small way through a few automated processes. The transformational value they experience is often a tipping point that whets their appetite for even more automation and deeper levels of application integration. But, this creates a quandary about how to maintain the array of automations. Ultimately, their success depends on the scope of the centers of excellence (COEs) that maintain their automations. Let’s explore further.
I believe that RPA has helped companies that previously held back from adopting newer technology solutions see the value of a digital mindset. These converts are now finding more opportunities for automation, and greater conviction in moving to digital-first operating models.
In short, something comparatively simple like RPA helps inspire confidence and vision.
Once this passion is unleashed, organizations come to fully appreciate that RPA is only one tool for automating operations. Many desire to transform their high volume, fast processes, and must confront the reality that surface-level RPA integrations are often not sufficient. The next steps towards more powerful automations often include integration via connectors and APIs.
The following exhibit reflects the diversity of systems which may now need to be integrated in a digital-first operating model world. (Spoiler alert: we’ll be writing a lot more about the Digital Capability Platform in the upcoming months.) And there are many ways to go about creating the needed integrations.
Some enterprises have cast aside the promise of surface-level RPAs, and now use their RPAs more through APIs. This is a bit ironic and worthy of a discussion by itself, but let’s get back to what happens as the types of automations proliferate.
One thing that all integrations – surface, APIs, or connectors – have in common is that they need maintenance. With surface-level RPA, you need to do a lot of robot maintenance when application layouts change. But all integrations, RPA included, require maintenance for other reasons as well. The biggest is the need to resolve data ambiguities, e.g., common customer names (think Jane Smith) with similar account types requesting a temporary address change. Which record should be updated? How can this correctly propagate across all the relevant systems and processes?
This is why a COE should be responsible for all types of automations, whether through surface or other integration methods. By looking across all automations, a COE can not only more accurately maintain the automations, but also identify anomalies and conceive new ways to structure interdependent automations. Of course, adding AI-based tools into the mix adds even more API connections to manage. But AI connections are far from the only ones that will need to be managed; the landscape will become more complicated before it simplifies (yes, I’m trying to be optimistic here.)
I can hear some of you saying that the COE should be an overall digital center of excellence. My answer is a big “no.” Digital is a far broader field that often involves major legacy transformation projects. Automation is clearly a part of digital, but it is operationally focused on the practical realities that come from modernizing processes that still primarily run on legacy systems.
This is a different mindset and a different set of competencies. As a result, it is best to keep a separate automation COE focused on the details of operational processes, while separately working towards the corporate digital objectives in a broader digital office. And that automation COE’s remit should be bigger than just RPA – it must deal with the combination of all types of automations that are enabling the operating processes.
Everest Group report describes clear marketplace advantage held by service providers who offer end-to-end capabilities, onshore services, domain expertise and digital proficiency.
The Life and Pension (L&P) business process outsourcing (BPO) market has seen a consistent pace of year-on-year growth in the range of 9 to 10 percent since 2014. According to Everest Group, growth will accelerate in the future, jumping from a market size of US $2.3 billion in 2017 to US$3.1 billion by 2020. However, growth will be focused on four distinct areas as buyers demand these specific capabilities from their service providers:
“In 2019, we will see buyers in the L&P insurance BPO market increasingly partnering with service providers to leverage the latter’s technological capabilities and expertise,” said Saurabh Verma, practice director, Business Process Services, at Everest Group. “In particular, as insurers’ hurdles continue to magnify and the need to address inefficient legacy systems becomes unavoidable, buyers will be even more open to leveraging external administration platforms. Thus, providers who have invested in digitally modernized and integrated platform solutions are going to have a clear advantage.”
These findings are discussed in more detail in “Life and Pensions (L&P) Insurance BPO: Annual Deal Trends Report 2019.” This report provides comprehensive coverage of the global L&P insurance BPO market, including the adoption trends across geographies and buyer size, factors impacting the market, key solution characteristics, emerging trends and the service provider landscape.
Other Key Findings:
Three approaches:
Transform & Shift
Shift & Transform
Hybrid
The relationship between RPA vendors and their clients isn’t so different from the relationship between Marvel Studios and its fans.
Since the movie Iron Man hit the big screen in 2008, fans’ expectations of superhero films have skyrocketed. Despite the rising and evolving expectations, Marvel has satisfied its audience and has made a little pocket change in the process.
In a similar way, RPA buyers are expecting increasingly more from their RPA vendors. So, have RPA technology vendors been MARVELous in their customers’ eyes?
Our recent research study among 50 enterprise RPA buyers makes it clear that vendors have excelled in addressing their primary drivers, which are cost reduction and process optimization.
Consequently, technology vendors should focus on continuously evolving their RPA solutions with a host of capabilities to help enterprise buyers achieve their strategic business outcomes.
As to be expected, the buyers in our research study found their RPA vendors excelled in certain areas and had work to do in others.
The key strengths for those vendors who were identified as the Leaders as per our PEAK Matrix™ assessment on RPA included:
Key improvement areas for Leaders included:
As there are so many RPA tools available in the market, each with its own strengths and weaknesses, it can be daunting for enterprises to select the right vendor for their unique needs. One critical part of the decision-making process is to focus on the X factors that are most important to their strategic agendas.
Our study found that factors including “ease of use and robot maintenance” and “scalability” highly correlate to buyers’ overall satisfaction levels. This is not surprising, as these are factors that buyers typically face issues with during RPA adoption. “Product vision and strategy” – and in some cases vendor expertise in a specific vertical industry or function – are also important buyer X factors.
While it’s clear that RPA vendors can do more to satisfy the needs of their customers – and that they’ll need to continually evolve their solutions – they have indeed been relatively MARVELous in delivering value and overall satisfaction to their buyers.
To learn more, please read our report “Buyer Satisfaction with RPA – How Far or Close is Reality From Hype.”
Is upskilling and reskilling little more than a thinly disguised attempt by HR departments to rebrand Learning and Development (L&D)? The answer, as one practitioner pointed out at a conference in Poland, is “no.”
I recently presented to the Association of Business Services Leaders (ABSL) Chapter in Krakow, Poland about the talent acquisition challenges that digitization poses to Shared Services Centers (SSCs.) The argument runs roughly like this:
The data in the presentation was based on the Everest Group survey of 81 SSC leaders in Poland, the Philippines, and India, published earlier this year (see “Building a Workforce of the Future – Upskilling/Reskilling in Global In-house Centers.”)
So obvious was the message that emerged from the survey that one or two skeptics in the audience questioned why retraining that part of the workforce most affected by the trend of automation was even worthy of discussion. Is it not just good L&D practice? And surely survey respondents would not admit to anything other than good practice when asked the question?
Not quite true: there were survey respondents, albeit no more than 10 percent of them, who said that they were not planning to undertake upskilling and reskilling as a means of addressing talent shortages. A small majority, 58 percent, said upskilling/reskilling was the highest priority in addressing this same problem, while 10 percent, possibly the same nagging 10 percent, said it was a low priority.
The discussion continued after the presentation. Without experience as a practitioner, I wrestled with an explanation as to why this 10 percent stubbornly refused to fit the theory. Thankfully, the HR head of a Krakow-based SSC rode to my rescue and gave the answer.
This is the group, she said, which understands that reskilling and upskilling is indeed good L&D practice but remains wedded to external hiring of permanent and temporary staff. It is the group that fails to see that existing employees must be recognized as the key pool to meet scarce talent requirements in SSCs.
Her explanation, thankfully, echoed our contention that successful application of reskilling/upskilling to talent acquisition needs:
She explained further. In her experience, the real difference between reskilling/upskilling as good L&D practice and reskilling/upskilling as a talent acquisition solution is simple. The talent acquisition solution approach is not considered aspirational, “something that HR does,” or nice to have. Rather, it is a strategic imperative.
How nice to have somebody who really knows what they are talking about answer a difficult question on my behalf!
Everest Group’s RPA Virtuous Circle
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