Industries such as finance, insurance and retail are increasingly applying Robotic Process Automation (RPA) tools to reduce costs, increase accuracy and improve business performance.
Today, RPA is being successfully and widely applied to tasks such as financial reconciliation, invoicing and loan application evaluation. In these initiatives, robots are taught to essentially replicate the steps humans take to complete a process. The next step is to exploit the technology’s ability to drive greater value through end-to-end process reengineering. This requires assessing inputs and final business outcomes, evaluating each step in the as-is process and determining how to change the process to align it more closely to a robot’s way of performing activities.
Traditional business processes were developed and refined to align with human behavior. Over time, steps were added to constrain the variations inevitably introduced by people interacting with systems. Additional tools, templates or process steps were added to adjust for changes or to allow one individual to review work performed by another individual. These checks and balances were necessary to maintain consistency of output in a world where people have different skillsets, different ways of approaching the same situation and an inherent tendency of taking “innovative” approaches to problem-solving.
Today, the capabilities of a virtual workforce can take reengineering and lean to a new level. The consistency, accuracy and repeatability of robotic outputs eliminate the need to counteract the variations that result when people deliver outputs. Because the actions of robots are specifically defined and precisely replicated, many of the process “band-aid” solutions necessary for humans become irrelevant and can in fact hinder productivity in a virtual workforce environment.
So why isn’t the reengineering potential of RPA being realized? One key factor is that RPA business cases are built on rapid results, with turnaround times of six to eight weeks. Facing time pressure, teams tend to focus on automating the process as-is, versus undertaking an end-to-end process redesign aimed at optimizing a robot’s performance. Another obstacle is a general lack of expertise in the industry. People with an operations background tend to stick to the as-is process approach, as that aligns with their training and experience. At the other end of the spectrum, those with technical expertise tend to focus on automation, rather than questioning why a process is performed the way it is.
While the prevailing focus on quick results and automation of as-is processes certainly delivers substantial savings and operational improvements, these benefits are, relatively speaking, low-hanging fruit. A long-term view aimed at process reengineering can drive a virtuous circle of improvement by enabling quicker automation of downstream processes and eliminating the need for multiple tools that were implemented to manage the process in the first place.
As the RPA market matures, a blending of expertise in both process automation and process reengineering will enable the integration of RPA with lean and Six Sigma methodologies, leading to exponentially higher returns on investment and greater business value.
About the authorDarshan specializes in the application of RPA to business process improvement, finance processes and transformation.
About the author
Darshan Shah
Darshan Shah is a Director at ISG with more than seven years of consulting experience in the Logistics, IT, Finance and Sports verticals. Most recently, Darshan was a Business Process Improvement Manager at Searce, Inc, where he served multiple roles including Finance Process Consultant, Business Transformation Manager and Implementation lead for accounting and customer service shared services. He holds a Master of Science degree from Texas A&M University with a major in Management Information System.
