Robotic Process Automation is…Well, let’s look at the meaning at practice, instead of the theory 😊 Before moving ahead with the definition, we should look at why and where it comes from?
A journey in history…back to the beginning of the 20th century.
Assuming you have a company operating in one country which is doing a production of home furniture. You have local vendors, customers, and your employees. In order to manage your business, you have a book for vendor records, a book for customer records, a book for employee records, as well as keeping your financial statements in another book. In fact, you’re doing well in your business and scaling up your business by extending to different countries and continents – e.g. current company operations footprint as follows:
Can you imagine how could you maintain your books of records? Where would you archive them? How would you communicate or exchange data assets between different subsidiaries and drive your global operations?
Shifting from paper to computers: During the 20th century, the Information Technology (IT) industry started to evolve and grow. It has started proposing many solutions as systems and devices to make our life easier – especially in business operations.
For your business to operate successfully, you decided to adopt some IT offerings and run away from paper works to digital operations. That sounds much faster and reliable operations compared to what you have had with papers, right? Of course, this is a happy scenario!
During the IT industry evolution the most multinational companies ended up with almost every country got their own solutions to move their data from paper to computers, or if a new company acquired there was already a system to operate on…I can give many more examples like these but in the end, you get through with multiple systems running for the same work and, for each system, you have a group of people full-time working on maintaining it and so on.
Resolving the complexity and variations after papers to computers move: Considering this fact, big tech companies came up with a new solution aiming to streamline, globalize and replace/upgrade most of your internal systems (including mainframes) with a single solution – so-called Enterprise Resource Planning (ERP) systems. The ERP systems are either replacing your legacy applications or being integrated with them. It helps a lot in order to run global business operations with less complexity and variations (discrepancies). For instance, one-click can show you all the business insights or can help to coordinate a work with multiple subsidiaries, or whatever location-x does, all the rest of the locations can see it in real-time…In the meantime, ERPs’ have their own obstacles as well (e.g. expensive customization and maintenance, slow in adapting the process changes, etc.).
So what more makes sense to do for your business after all those?
- Adopt a 3rd party ERP system for the whole organization (high Project cost, not much flexibility tailoring it exactly for your org, faster to deploy)
- Develop an in-house ERP system for the whole organization (high Project cost, flexibility tailoring it exactly for your org, slower to deploy)
- Keep the complexity as-is (high Labor cost, no flexible and agility, risk at business continuity and operational mistakes)
If you go for option-1 or option-2, it sounds like a great solution for your business! In fact, the major system changes do NOT mean only systems are impacted by this. When you go for such a change, your business or operating model will be impacted along this journey as well. Therefore, this is actually a “Business Transformation” rather only a system change, which means; the need for new process designs, organizational and cultural changes, new skill sets, resource reallocation, and many other impacts. It will then result in additional costs for your company, additional skills to hire, additional teams to establish or new contracts to make with 3rd parties. Sometimes, “The cake’s not worth the candle!”.
If you go for option-3, you may need additional workforce performing manual tasks (e.g. for data extraction, conversion, upload, delete) between multiple different systems for operating.
Inventing a glue to reduce the variation and decrease the complexity: Robotic Process Automation (RPA) has finally got into our life! It is all about connecting different systems to operate a process which is non-value adding and repetitive – simply the maintenance of complex and discrepant systems/processes. These move business operations from human to a Digital Worker (software enabled Robots/Bots). RPA empowers the business operations for efficiency and, gives them flexibility in automating business processes easily and faster.
RPA tools provide you with a simple studio (as simple as Visio), where you can design your process with the visual objects (almost no code needed) and deploy it faster to gain the returns on investment!
This does not mean that we no longer need IT staff though. The major difference between IT and RPA teams is another layer between IT and business functions, where people with extended skills of digital technology (industry 4.0) and deep process/operational understanding, helping business operations to streamline processes and target system utilization and, to minimize the system/process Complexity and Variations. As the side benefits, it also helps to increase the agility, flexibility, and scalability within the service operations, so that operations staff can focus on more value-adding activities such as process optimization, re-engineering, increasing customer satisfaction and so on.
P.S. During the article, I used ERP systems as an example. RPA is more than it and has more capabilities. There are many other business cases that can be easily RPA applied. I’ll cover those areas and capabilities in the following articles.