RPA’s latest global trends: Interview with a foreign expert
Entering the latter half of 2016 in Japan, we often heard the new word “RPA” and also about companies which actually implemented this new tool in their business operations. It is obvious that RPA in Europe and the United States is ahead of that in Japan. However, we can take this gap as a great opportunity to learn from those pioneers and utilize it as a tool to help improving prediction accuracy in the future.
We interviewed Ramon de la Rivaherrera, Head of Robotic Process Automation (RPA) at everis. everis, an NTT Data Company is a Business IT services company headquartered in Madrid, Spain and offers various IT services to customers in Europe, the United States, and Latin American countries. We asked Mr. Ramon about RPA trends in Europe and the United States as well as his forecast for the future RPA market.
|Ramon de la Rivaherrera
Head of RPA at everis in Madrid, SpainFormerly, Ramon worked in several global business consulting companies including A.T. Kearny and CGI, where he specialized in Operations Transformation and process optimization and automation.
Sucessful Story in Banking
In Europe and the United States, what made RPA so popular and how has it spread?
What we see here in Europe right now is that companies in every industry are initiating or are already engaged in RPA transformation program. This is because I guess the rest of industries are looking at a successful case released by the original adaptor of RPA, the financial sector, especially banking and they are looking at the business case and benefits achieved and they want to bring the benefits of the RPA technology to their own processes and operations.
The initial adoption of RPA technology was in the financial sector, in Banks. Banking is an industry constantly looking to improve their operation and reduce cost since it has a lot of regulatory pressure from the government for compliance issues, and, in addition, the interest rates in the last number of year have remain very low. Another element was the increase competition by new FinTech companies eroding the market positioning of traditional banking products. So these elements provoked Banks to look for a new way making their processes more efficient.
So with this background, the financial sector, especially banking started focusing on RPA at an early stage and working to apply RPA in their operations. Starting from a small PoC, technology demonstration, visualization of business cases and development of change management, then some four years ago, we have finally seen the positive effects brought by RPA transformation program.
I guess the rest of industries are looking at successful cases and benefits achieved by the financial sector and they are looking into bringing this technology to benefit their own processes. That is how RPA has been spread in Europe and the United States.
RPA for individual and small businesses
In Europe and the United States, RPA implementation is said to be 3 to 4 years ahead of that in Japan. What is the level of deployment rate of RPA in European market as of today?
According to a global market study targeting 590 companies (*1), 75% of the companies interviewed are in R&D of different stages on RPA and 34% are in the discovery phase where there are initial technology discovery phase, PoC, and assessment to define the business case for the technology, 27% are already migrating their first process in production, 13 % are scaling up RPA implementation, scaling up means they have already implemented 50 or more robots and are trying to scale it up.
This number will continue to increase. One of the three major RPA software companies, UiPath reported in July 2018 that their annual recurring revenue increased from $1M to $100M in less than 21 months, and the rest of the two lead software companies, Blue Prism and Automation Anywhere, are also generating huge revenues. Those numbers tell you how big the RPA momentum is. NTT Data is a partner of all lead RPA software companies: Uipath (Gold Partner), Blue Prism and Automation Anywhere.
Any possibility that RPA will only last for a short while?
No, I don’t see it that way. I think the RPA field will continue to grow without doubt. RPA is a very attractive technology that gives companies a competitive advantage by freeing people from repetitive routine tasks so that employees have more time to perform value added functions for their companies, and as a consequence improving the business efficiency and reducing the cost of routine repetitive tasks. Currently, large companies are the ones implementing RPA but in the future this trend will expand to mid-size and small companies.
One of the lead RPA software companies, UiPath, offers a free RPA program (*2) to individuals and small companies. The purpose of this is of course to motivate and revitalize the market, but at the same time, such program offered by a software company will also help boost the RPA penetration in the mid and small market.
Governance model before implementation is the key
Some companies in Japan worry about possible troubles on their main systems including ERP to be caused by renewing for RPA implementation.
Without a strong governance model (Control System) and change management, such troubles could arise on RPA implementation.
Business changes every single day and not only when ERP is updated, you might have to adjust your business in order to adopt a new technology in the market. Also, you have to adjust your processes running on the system as the system changes. In order to prepare for those changes, you need to work together with all the stakeholders and create a strong governance model to ensure business continuity when changes arise.
The governance model will need to include not only how RPA should handle business changes, but also how RPA should deal with unexpected technical situations (exceptions) such as communication cut-off and system down, and many others.
RPA evolving into IPA
Recently, the use of RPA hook up with other technology is growing including RPA and AI OCR. In global markets, do you see any trends?
Yes, we are currently working with several complementary technologies to RPA. We are using Intelligent OCRs to structure semi structured data such as invoices, and the feed the structured data into RPA processes. We also have been working with intelligent Chatbots that we are connecting to RAP processes. We have several examples in the telecoms industry. We are also using Business Process Management software to enforce end-to-end traceability and workflow control in process where both Humans and Bots are required.
Another technology that we are using is Process Mining. Process mining is a tool that helps our RPA Process consultants to visualize the process by analyzing the event log accumulated within the company’s system. With Process Mining tools we are able to analyze current processes faster and more accurately, identifying the happy path as well as many process exceptions – sometimes these exceptions are hard to identify with traditional analysis methodologies – making the RPA process design faster and the robotized processes more resilient.
Would that be the case the word “RPA” would be replaced by another word eventually as the alliance with the other technology is expanded?
Actually, the new name now is IPA (Intelligent Process Automation). IPA includes RPA and complementary technologies, including AI. With RPA we can only automate those processes that are manual and repetitive but with IPA can go further to achieve an end-to-end operations transformation for our clients.
Because of the impact of IPA in the operations of companies around the world, the IEEE (Institute of Electrical and Electronics Engineers) has created a Standards Working Group that is currently studying the IPA technologies. NTT Data is participating in the IEEE IPA Standard Association Work Group, and I am currently representing NTT Data in this group.
Also in 2018, Automation Anywhere、Blue Prism, and UiPath have setup online Market Places (*3) with a lot of third party solutions that complement the RPA functionality. These market places allow for easy download and connection to IPA technologies, complementing RPA.
Promote implementation of RPA based on proven methodology
Evolution of IPA sounds very attractive, but currently in Japan, most companies are still in the phase where they are thinking about implementation of RPA or just starting their RPA journey. Do you have any message to those Japanese companies?
As already mentioned it in the governance model, it is important to follow the proven methodology for adopting RPA and achieving a successful RPA journey. I will show you the 5 points that are considered to be fundamental.
The first point is to involve both business and IT departments even in the discovery phase. It is very important that business and IT work together.
The second point is that the first process or first couple of processes you are going to do on PoC need to be simple, but representative for the company. They need to show value of the technology to the business. Also in the discovery phase to opportunity assessment, you look at all the processes and try to do business cases because it shall be a marketing tool that will enable later on to sell or to communicate the advantages of RPA to the rest of the organization.
The third point is to have a clear vision for how to achieve business transformation with RPA. With this vision and the results of PoC, you have to go convincing the top management that this is a true value for the company. If you get the top management commitment, the rest of the organizations in the company will be involved automatically. As mentioned before, 34% of the companies are in the discovery phase of RPA. Some of the companies in this group seem to be struggling with convincing the top management and cannot move on to the next phase for a long time. It is indispensable for adopting RPA to have a clear vision and convince the top management.
The fourth point is to create a Center of Excellence (COE: a team or department to be a center for driving a certain project cross-organizationally) and develop a strong governance model, that will enable to set up a change management procedure among all the stakeholders. This is very important.
Finally, change management process for digital workforces in a company is not an easy process, so my recommendation is to get help from a consulting company that has a lot of experiences in technology, business transformation, change management,and BPO/AMO capability like NTT Data.
*1 HFS Research in 2018
*2 UiPath Community Edition
*3 Market Place: “Bot Store” of Automation Anywhere, “Blue Prism Digital Exchange” of Blue Prism, and “UiPath Go!” of UiPath.
WinActor also has their own Market Place on the official website.
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