Automating the tasks of the human workforce in the professional services sector using intelligent software platforms known as ‘software robots’ to interact with existing software systems and complete business processes in the same way as a human worker in order to fulfil existing business outcomes more efficiently.

We have all seen the use of robotics in the automated production lines of the manufacturing industry and the transformative increases in productivity experienced as a result. In the service industry however, we have traditionally witnessed low levels of automation due to the majority of the work being done by people, often in a manual, ad-hoc and bespoke way. With the advent of new technology we now are seeing the emergence of Intelligent Software Platforms that can replicate the actions of people by interacting with existing software systems through front end user interfaces in much the same way as a human worker. We are beginning to realise the reality of a digitised workforce.

What does it do and how does it work?

At its most basic level, Intelligent Process Automation [IPA] Software records the actions a human worker takes to complete a computer-based business process across existing software applications. The software achieves this by breaking down common business processes into individual steps, and then recording the outcomes, enabling it to automate them as many times as required and at a very rapid rate. As IPA software interacts with existing software systems through the front end user interface, it is relatively straightforward to build and deploy. Given IPA does not require direct integration with base code, its interface is not hindered by the different scripting languages of existing enterprise systems. IPA software is non-invasive and is therefore quick to implement and quick to scale across an Enterprise.

How is process automation intelligent?

The spectrum of Intelligent Software begins with the most basic of automation which is achieved by software commands following a scripted process. This has been common for a number of years to perform tasks within ‘Single IT’ applications. Robotic Process Automation [RPA] software applications take this to a new level by scripting tasks across multiple ‘Single IT’ applications. This enables business processes that span multiple ‘Single IT’ applications to be automated. The next level up in complexity sees technology platforms that can follow algorithmic business rules, which have commonly been termed ‘Autonomics’ and these can perform more complicated tasks requiring multiple outcomes. From then on, we see software applications that have a cognitive ability to ‘learn on-the-fly’ through pattern recognition and reasoning, these can perform very complicated tasks and these are commonly associated to ‘Cognitive Software’ all the way up to ‘Artificial Intelligence’. It’s worth pointing out that these technologies work in different and specific ways, some simply follow scripts and others are trained to be intelligent by human workers, whilst others at the top end of complexity are able to learn by themselves. It is important therefore, to describe these technologies as a spectrum rather than a continuum, as described in the diagram below.

For the purposes of practical business use we are still at the emerging end of this spectrum. Although as the rapid pace of technological development has surprised many industry commentators and experts, it is clear the benefits to be gained from even the simplest automation platforms demands immediate attention. These applications have got many people across a variety of industries hugely optimistic about its use and deployment and experts are calling this out as the next big, significant wave of technological revolution.

What are the benefits?

The benefits of automation have already been proved out in other industries so we can say with some certainty that the following benefits would apply to the Financial Services Industry. The most obvious benefits being:

Reduced Operating Cost – arising from reduced headcount to complete business processes. The cost of using a software robot has been estimated to be 1/9 of the cost of on-shore FTE and 1/3 of the cost of an off-shore FTE. As the technology matures these differentials will only increase.
Increased Productivity – delivered by the gains achieved in efficiency from doing the same or more at a reduced operating cost. Most savings in cost will arise from reduced headcount although savings will also be made by monitoring and managing up the performance of remaining business processes.
Increased Accuracy – of business outcomes by using elements of automation that safeguard against human error in business processes by automatically checking and validating human worker actions and decisions.
Increase Speed – of processes due to Intelligent Process Automation technology orchestrating systems to complete business processes much faster than human workers.
Low Installation Costs – of this technology mean it can be quickly deployed compared to historical IT projects and the return on investment can be measured in weeks rather than months.
Improved Workforce Orchestration – the introduction of automation into business processes allows for more agile allocation of worker resources. Repetitive and time-consuming low value work can be automated leaving residual, complicated high value knowledge work to be allocated to the expert human workforce.
Increased Agility – of automated business operations means they can generate real-time analytics, alerts and notifications and respond to periodic variations in demand with additional workers, either; humans or robots. Software robots can also be deployed to complete business processes 24/7. Additionally, as enterprises grow, automated business processes can match that growth.
Greater Oversight – of business processes and outcomes. In digitised operations potential issues and errors can be flagged for senior management attention as those issues arise. Additionally, as predictive technology develops, alerts can be configured for those errors that might arise and major issues can be avoided as a result.
Improved Insight – into an enterprise’s operations from the improved analytics that can be derived from digitised business processes. These analytics can be made available in real-time or on a periodic basis, giving senior stakeholders better quality insights with which to view operational performance and adapt their business as required.

In addition to the upfront benefits from automation, the enterprise can also make gains from other indirect ‘soft benefits’ of automation.

Standardisation – of business processes across departments, enterprises and industries will, over time compound the overall benefit from Intelligent Process Automation.
Improved Performance – where business processes are digitised, the performance of workers is tracked. Given the axiom of what is ‘monitored is managed’ then this will undoubtedly lead to an overall improved level of worker performance.

Understandably concerns have been raised over this form of technology. Some commentators have suggested that the adoption of automation and robotics could spell the demise of humans in the workplace and eventually lead to mass unemployment. This is unlikely to happen in the near-term but, what we can say with some certainty, is that what we will see is the capabilities of human workers being enhanced and indeed augmented by Intelligent Process Automation. We will see situations where human workers will be more productive and can achieve greater things with the same inputs. Their processing power will be boosted and this will empower them to achieve better outputs. Ultimately they will achieve greater fulfilment in the work they do. Indeed, removing the mundane, boring repetitive elements of peoples’ jobs and freeing them up to focus on the more interesting, intellectually challenging and high-value knowledge work will enrich people’s sense of job satisfaction as well as providing many benefits to the Enterprise that employs them.

What are the practical business uses for the Financial Services Industry?

The technology can typically be applied to any computer based task or business process that is currently completed manually by workers using single or multiple software applications.

This relates to business processes that are unique to Financial Services Enterprises such as new account openings, KYC and AML requirements, data management, transaction management and regulatory reporting, to name just a few. What is common to all Financial Institutions is the proliferation of multiple legacy IT systems and traditionally people have been employed to fill in the gaps between these systems to complete business processes. IPA is naturally suited to joining all of these legacy systems together in an end to end automated flow and thereby reduce the human interaction required to complete the business process.

There are also core business functions that are specific to any Enterprise and some of those business processes can be automated: IT Support, Legal and Compliance, HR and Training. Enterprises in professional services industries outside of Financial Services have already begun automating business processes within these functions with great effect.

Over the last few decades we have seen Professional Services Enterprises out-source elements of their business operations to low cost of labour offshore sites. This form of labour arbitrage initially saw substantial benefits in reducing operating costs. In recent years however, the cost of off-shore labour has risen due to high attrition rates amongst workers leading to increased wage demands in these jurisdictions. Now the benefits from labour arbitrage have likely bottomed out and could even be declining. Financial Services Enterprises are amongst those that have traditionally benefited from outsourcing but, as with other types of Enterprises they are increasingly looking for new ways to reduce operating costs. Even where Enterprises have already outsourced their operations to offshore sites, they should press their outsource providers to demonstrate how they plan to integrate IPA as a solution to continue overhead cost reduction.

Conclusions and next steps?

The benefits and advantages of this type of technology are clear. What is less straightforward is how an Enterprise goes about the discovery, assessment, implementation and performance evaluation of this type of technology. There is currently a glut of software vendors all claiming to offer IPA software, robotic automation, cognitive and self-learning artificially intelligent software platforms. However, Enterprises need to be very careful about how they approach this technology. They should be very clear about the business problems they wish to solve, and be extremely exacting about the Vendor or Vendors they chose to use. Best practice typically requires full assessment of business processes prior to automating them. As with any product being used within Financial Services due diligence should be completed to ensure selected solutions are robust. Quantitatively evaluating the value realised as a result of any implementation should also be an integral part of any Digital Transformation programme.

Clients can follow a Digital Transformation Assessment DTA approach with Actual Intelligence to assist them in selecting solutions and Vendors. In the case of Intelligent Process Automation software, we can assist clients by managing a Proof of Concept [POC] exercise for them. This will test the technology and can achieve buy-in from the rest of the Enterprise based on the actual value the POC delivered.

Intelligent Process Automation will undoubtedly become an integral part of the future operating models of Professional Services Enterprises and fully automated business processes will be realised over time. The experiences of each Enterprise’s journey of how they get to that end state model will of course differ significantly. With the application of knowledge, research and planning combined with appropriate levels of due diligence, Enterprises will help to ensure they select the optimum path to Intelligent Process Automation.