Alongside productivity, RPA can enable a multitude of benefits

04 July 2019 Consultancy.eu

Organsisations across sectors are looking to significantly ramp up their spending on robotic process automation (RPA) according to a study by Protiviti in collaboration with ESI ThoughtLab. While spending is mostly funnelled towards operation-related functions, the technology’s going track record means that in the years to come RPA will branch out to virtually every corporate function.

After polling around 450 executives of large organisations (78% of the companies surveyed have an annual revenue of $1+ billion) across multiple regions and industries, the authors have re-confirmed why robotic process automation is one of the most talked about emerging technologies around. Companies that adopt RPA in their processes reap the benefits. While much of the attention goes to operational advantages such as increased productivity and cost savings, use cases are showing that RPA can in fact “produce a multitude of benefits,” said Tony Abel, a managing director at Protiviti.               

“Today, RPA is a lynch-pin of sleek and agile operations that will fortify companies’ market positions by driving efficiencies, boosting speed to market and bolstering financial performance.” Asked how RPA is improving their business, productivity indeed ranked first, but two aspects centred around the customer experience – better product quality and customer satisfaction – came in at second and fourth spot.

“While we see RPA as a huge driver of improved performance and efficiency, the impact correlates back to accuracy and customer experience,” said Prakash Mall, senior director of RPA at Target and one of the respondents surveyed.

Business functions using RPA in two years

Companies are in addition learning firsthand that many RPA investments can cross-pollinate synergies. A retailer, for example, uses RPA in managing its supply chain to avoid stock outages that can frustrate customers. Bots automatically reorder stock when the inventory management system indicates supply has fallen to a designated level. In the case of this major retailer, not only is merchandise more reliably in stock, but store managers also have more time to focus on the customers in their stores. 

“RPA’s biggest benefit is often the time and bandwidth unlocked when tasks are automated,” commented Jonathan Wyatt, a managing director at Protiviti. 

Another advantage of RPA highlighted in the study is its potential to help solve complex IT challenges in a lean and agile manner, sometimes on a temporary basis. Robotics can for instance help companies advance while they still operate with outdated legacy systems. Peter Henstock, a senior data scientist at Pfizer, said that bots can “work around” legacy systems by extracting data from various systems that aren't connected. The bots can then perform the tasks that these systems can't do on their own. 

Sharon Lindstrom, a managing director at consulting firm Protiviti added, “Technologies like RPA can extend the life of many of those legacy investments and get more value from them than they ever thought possible.”

Investing in RPA

Against this backdrop, it is not surprising that companies are investing significantly in RPA and are planning to dedicate even more resources toward developing their RPA capabilities over the next two years. Currently, they on average spend anywhere between $1 million and $10 million on RPA, with the size much dependent on an organisation’s RPA maturity. 

RPA maturity

The survey’s data has found companies in the financial services and technology/media/telecommunications sectors to be the furthest ahead, with healthcare, consumer goods (including retail), and manufacturing companies following suit. Energy and utilities companies have progressed the least, with only 9% at the maturing or advanced stages. While all industries expect to make headway in the coming two years, the relative position of players won’t change much – those currently in the lead will maintain their advantage. 

“Although many organisations are in the early stages of RPA implementation, every company that participated in our survey plans to expand its RPA usage within the next two years. In addition, while less than one in five companies overall are currently at the maturing or advanced stages of RPA development, that proportion is expected to more than double within the next two years,” said Abel.

Implementing RPA

Alongside the fact that progress in RPA does not come cheaply, companies adopting the technology face a number of roll-out challenges. An inability to prioritise potential RPA initiatives is cited by 40% of the respondents as an obstacle, while 30% find that their scattershot approach has made it difficult to pursue the best applications of RPA. Other challenges that surfacethe  most include concerns associated with cybersecurity (40%), regulation (30%), and the lack of skilled talent (24%).