robotics process automation, Study notes of Engineering

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ROBOTICS PROCESS

AUTOMATION

USHERING INNOVATION,

COST SAVINGS

Amidst continuous pressure from internal stakeholders to bring down costs,

the finance function has become leaner and more cost-efficient. The Chief

Financial Officers (CFOs) besides donning multiple hats(i.e. providing

forward-looking insights and support in strategic planning and

decision-making)continue to keep an eye on cost control, as well as respond

to evolving market requirements by improving organisational agility.

The CFO is looking to automate processes, in order to free up resources to develop and support business strategy and drive critical business initiatives. The CFO is moving beyond plain vanilla cost and labour arbitrage advantages, offered under the traditional outsourcing model. As the clamour for differentiation grows, the CFO is demanding innovative technology solutions from the Finance and Accounting Outsourcing (FAO) service providers, to deliver customer satisfaction. According to a recent study from Horses for Sources (HfS), 47% of BPO buyers indicate automation as a critical component of the BPO service provider capabilities. TRANSFORMING CHALLENGES INTO OPPORTUNITIES

In the FAO space, processes such as Order-to-Cash (order management,

invoicing and collections, etc.), Record-to-Report (fixed asset accounting),

Claims Processing and General Data Entry, etc. are ready for RPA.

RPA is the go-to solution for organisations to benefit from process automation and advanced operational and process analytics; at economically viable price points—something that was not possible with previous automation approaches. This is because the RPA platform uses the client’s existing user interface and enterprise applications (both in-house and in the cloud) seamlessly, with the software robot logging into the application (similar to how a user would, albeit in a controlled environment). This does not require back-end integration or access to client data through API’s. The software robot is non-intrusive and will function within the security controls and restricted access rights. In short, there is no compromise on security, resilience, scalability, compliance or operational governance. Furthermore, software robots are technology-agnostic and can be used in any data-driven, rule-based processes. This makes RPA a capability that can be leveraged irrespective of industry and application, making it cost-effective. ENGINE OF BUSINESS GROWTH

Xchanging has already automated seven processes for some of our insurance industry

customers. The robots are working over 30,000 cases per month. We are already seeing

significant benefits from the robotics implemented to date. For instance, the average

processing time has reduced from around five minutes to under 10 seconds per unit and

12 multi-skilled robots are all able to work each process 24/7.

In addition, our robots now scan third party workbaskets for items that we are unable

to process and reject back to the source (broker). Buoyed by the encouraging results,

Xchanging is in the process of deploying more robots across other customer processes

and for our internal Shared Services functions.

Xchanging is also establishing the ‘Blue Prism Competency Centre’ to spread the

footprint of RPA across the company. In addition, we are also setting up a ‘scalable’

environment to support the robotics platform and process modellers who have been

trained to build processes on Blue Prism (Xchanging’s robotics partner). We have also

created a dedicated and accredited RPA team, reporting into a RPA Product Manager.

“We have embraced RPA and implemented the required infrastructure, framework

approach, delivery capability and support model for the initial wave of processes. With

this capability, we will offer true innovation to our customers and deliver creativity and

real process transformation” -Product Manager RPA, Xchanging

xchanging.com ROBOTICS PROCESS AUTOMATION | 5

VALUE PROPOSITION OF RPA IN FAO

By eliminating repetitive and manually intensive processes, RPA drives efficiency,

enhances productivity, consistency and accuracy. This enables companies to improve

response time to new markets and adhere to global regulatory requirements

ROBOTICS PROCESS

AUTOMATION

PRODUCTIVITY AND EFFICIENCY

Robotic automation tools are at least twice as fast as human FTEs and can function 24/ COST SAVINGS Robotic automation tools are up to 65% less expensive than offshore based FTEs

SCALABILITY AND FLEXIBILITY

The ability to replicate robotic tools across geographies/business units increases scalability and flexibility ACCURACY Automation phases out human intervention, thus reducing possibility of human errors COMPLIANCE Robotics allows data and processes to be retained onsite

xchanging.com ROBOTICS PROCESS AUTOMATION | 7

Organisations expect RPA to drive productivity (by automating transactional

tasks) and profitability (by gleaning relevant business information from

unstructured operational data). RPA allows companies to save 50-70% on

labour costs by making intelligent use of resources, near-zero error rates,

improved compliance and reduced process cycle time.

Therefore not surprisingly, a large majority of the CFOs are already contemplating RPA to automate a large percentage of their rules-based, repetitive back office processes resulting in: LOWER COST: Robotics Process Automation can create a 25-50% cost savings. Process automation enables round the clock execution at a fraction of the cost of a regular FTE model. A software robot can cost as little as one-two ratio the price of an offshore FTE and as little as one-fifth the price of an onshore FTE. This number can be significantly greater, given overnight system availability. HIGHER EFFICIENCY: Robots can work 24/7, 365 days a year, with no vacation breaks or attrition. This leads to reduced cycle time and enhanced productivity. ENHANCED ORGANISATIONAL PRODUCTIVITY AND QUALITY: RPA can help organisations enhance organisational productivity without significantly modifying the existing process flow. Robotic FTEs are deployed into existing transactional systems operating the processes in exactly the same way that human FTEs do today. INCREASED COMPLIANCE TO REGULATORY NORMS: Organisations are wary of the possibility of experienced process associates skipping any step in the standard operating procedure. The robots are programmed to follow the SOP and hence perform the task in exactly the same way, every single time. In addition, robotic automation also generates extensive audit trails at the ‘keystroke’ level, which provides an extra level of assurance during testing and production. Analysts, however, add a word of caution for organisations considering RPA to be a replacement of their existing systems. Enterprises need to remember that RPA does not and cannot completely replace the existing systems, but can only perform specific rule-based repetitive tasks. In addition, the cost of building automation into the systems should also be well thought through. With increasing incidents of data theft, organisations are treading cautiously when it comes to providing access to confidential business data, under RPA. VALUE DEFINED, VALUE DELIVERED

Robotics Process Automation is maturing in terms of credibility, clarity and

applicability, as more and more organisations are embracing it. According to

Gartner, the focus of outsourcing is shifting from resource augmentation to

outcome-based managed services.

As this continues to evolve, the role played by RPA will be even more significant. Besides process automation, this technology can be applied to a wide range of domains including information technology support and management, and automated assistance, etc. The main challenge with RPA is with respect to handling unstructured data. In the F&A domain, especially in payments and collections, the data—including correspondence, claims, complaints and invoice—are received via email, fax, post and paper, etc. The potential to combine RPA with new “Artificial Intelligence” (AI) engines, would help overcome this challenge. Therefore, together with AI, RPA can make deep inroads in the F&A domain. IN SUMMARY

THE BENEFITS OF ROBOTICS PROCESS AUTOMATION ROBOTICS PROCESS AUTOMATION

EFFICIENCY/COST

BASE REDUCTION

QUALITY/ACCURACY/

RISK MITIGATION

CUSTOMER

SATISFACTION

FLEXIBILITY/

MULTI-TASKING

MI, AUDITING

AND SECURITY

OPERATIONAL EFFICIENCY

REDUCED

DELIVERY RISK

DATA COLLATION

AND MIGRATION

TECHNICAL

APPLICATION INTEGRATION

VIA USER INTERFACE