Home Technology Enterprise RPA: A Key Enabler For Incumbents’ Digitisation Journey

Enterprise RPA: A Key Enabler For Incumbents’ Digitisation Journey

by internationalbanker

By Vargha Moayed, Chief Strategy Officer, UiPath




Lately, there seems to be a frenzy well fed by consulting firms in the enterprise world about digitisation and the necessity to “digitise” companies’ business models and operations.

But what is really new about digitisation? Haven’t companies been digitising for decades by implementing ERP, CRM, and other enterprise software, as well as the development of glitzy websites? So, what is the fuss all about? Why are some companies appointing digital officers? Why, all of sudden, all these talks about being disrupted? Didn’t we hear similar stories already two decades ago with the advent of the internet?

The key reason is the fact that digital sales channels that were a “side show” for two decades representing a small percentage of total sales are becoming the “main show” soon to represent the largest percentage of sales.  

Furthermore, digitally native companies have risen the bar on customer experience in terms of convenience of purchase and transparency.

This has created a contrast between digitally native companies— such as Amazon and some recent fintech companies—with those of incumbent retailers and financial institutions.

Digitally native companies have from the start created systems that take advantage of the latest advance in technology to put the customer experience at the heart of their value proposition and connect – from inception – the front and back office functions. Hence, they can sell a product in couple of clicks, show in real time the inventory availability, process payment easily while even providing AI driven advice. Likewise, some fintech companies can process an international payment or approve a loan in a matter of couple clicks from one’s mobile phone.

Incumbents, on the other hand, have “digitised” in the past in “silos”, making the digital sales channel just one of many sales channels. Traditional banks had to maintain existing sales channels such as branches, ATMs and telephone banking while adding internet and mobile banking as a digital alternative. Brick and mortar retailers and manufacturers have to manage a complex network of company owned stores, resellers stores, franchisees and warehouses in parallel to their direct internet-based sales channel.

In addition to complexity in business models — such as the conflict between their direct digital sales channels versus their network of resellers and franchisees – these companies also had to manage the complex supply chain that comes with such a complex business model. So, for instance, many had to manage the inventories of the digital sales channel separately from the more traditional channels, robbing themselves of the advantage of having both a digital and physical sales channel.

However, faced with increased competition, incumbents have not rested on their laurels and have digitised different elements of their delivery model by deploying more sophisticated systems along their value chains in back office functions, supply chains, operations and sales. Unfortunately, due to the very nature of their legacy systems and operating models, these efforts have been conducted in silos optimising the specific function they were digitising without the luxury of having, unlike the digitally native, a holistic view of the delivery model.

Today, due to the “centrality” of the digital sales channels and the increased competition from the digitally native, incumbents have the obligation to up their game to provide their clients the same customer experience while staying cost competitive.

Faced with this challenge, some companies may find the task daunting and decide to create ex-nihilo new entities to compete with the digitally native competition. While this approach is tempting, business history is not on their side. Witness the ill-fated attempt by GM to create Saturn to compete against Toyota or tepid success of the low-cost subsidiaries of established airlines.

Instead, incumbents have no choice but to face the challenge heads-on and transform themselves to be able to compete by providing the same customer experience as the digitally native competition, while keeping some of the advantages of incumbency such as brand recognition and existing, large customer base.

To do so, they will need to transform their information systems and infrastructure. It is not reasonable or feasible to believe that incumbents will go for a “big bang” by scrapping legacy systems to build and implement new applications from scratch that are similar to those of the digitally native competitors.

Hence, the only reasonable solution is to find a technology that will allow business to rapidly and cost effectively connect legacy systems among themselves and with new applications, as well as infusing them with the latest progress in AI.

Enter Robotic Process Automation (RPA). RPA is a software tool that can automation routine, rules-based tasks to alleviate humans of mundane work so they can focus on more value-add activities.  It is the white-collar robot equivalent to its colleague on a manufacturing floor plant that accomplishes what a blue-collar can do.

It accomplishes such a feat thanks to its “presentation level” integration capabilities (as opposed to data and application layer integration) built on advanced screen-scraping and computer vision technologies that allows it to “see” what is displayed on a computer screen (real or virtual machine). Then thanks to an extremely user friendly and intuitive interface it can be programmed to follow the same process steps a human would. Hence it can interface with multiple applications, web sites, and actually do any rules based (and soon cognitive) tasks a human would accomplish.

So, it easy to see how this technology is the ideal tool to connect multiple legacy systems rapidly and seamlessly. Indeed, most processes can be automated in a 6 week sprint compared with months of development often required for application layer integration. 

More importantly, RPA offers a backbone that connects all other IT applications non-invasively and seamlessly. Hence, it can already integrate legacy systems with new applications—including all other automation technologies. Furthermore, RPA is actually the enabler of AI in the enterprise space because as a platform it can effortlessly integrate technologies such as Intelligent OCR and specific machine learning algorithms, allowing the robots to make cognitive decisions when required and interact with human co-workers through integration with chatbots technologies and other Natural Language Processing (NLP).

And it can do all of these securely and at scale.

With all these capabilities, it is easy to imagine why this technology is key to the efforts of incumbent companies to digitise themselves as it offers a practical solution that is fast to deploy and flexible, making it easy to adapt to any legacy environment.

With proven benefits – including an average of 60% reduction in processing time for automated processes and the elimination of errors – companies are already experiencing the benefits of RPA with the market expected to reach $2.9 billion in 2021.

However, beyond these early tactical benefits, companies and digital officers specifically need to fully appreciate the strategic value of the RPA technology and embrace this technology as the cornerstone of a company’s digital transformation.


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1 comment

CiGen June 25, 2019 - 6:34 pm

“The only reasonable solution is to find a technology that will allow business to rapidly and cost effectively connect legacy systems among themselves and with new applications.” – spot on! Leveraging AI advancements through technology such as RPA can bring lots of benefits to large enterprises with many manual processes that would be perfect for automation, being simple, rule-based and high volume. Enterprises can cut down substantial costs and free teams to focus on higher value tasks.
The main reason is the default that robotic process automation works best when applied at scale. Moreover, the positive experience of those who have already engaged in scaling (as shown by recent surveys) reinforces the idea that RPA will bey a key element of enterprises’ evolution.


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