The theme of this year’s World Economic Forum was the ‘Fourth Industrial Revolution’ with a focus on how global businesses can harness big data and use automation software to streamline operations and grow.
As we see automation and artificial intelligence reshaping how economies work, global organisations are now looking for ways to adjust their business model in order to survive and thrive in the digital era.
The spotlight is being shone on new technologies which will serve businesses and increase their chances of a 1990s-style jump in productivity. One of the innovations where we expect to see significant growth is the move towards robotic process automation (RPA).
The advent of 'cybershoring'
The adoption of RPA which eliminates manual effort across business and IT processes, is transforming the face of business operations. It’s spurring an industrial revolution in the back office, replacing unnecessary manual activities and re-imagining processes to drive continual improvement and efficiencies.
> See also: The real cost of outsourcing IT
Even more radically, RPA is completely altering the business case dynamics for outsourcing.
Businesses have typically strived to keep operational costs low by delegating work offshore. However, the idea behind ‘traditional’ offshored labour is dying as the rising cost of offshore workers simply makes outsourcing unsustainable. In today’s competitive climate, there is no location left for businesses to go to cut labour costs further.
But there is a cybershoring solution which takes away the focus on where the work is, and focuses on the how. RPA unlocks the opportunity to transform business activities, from processing online orders right through to the financial close.
In this case, software robots are beginning to replace and improve business and IT activities that would normally be done by human beings. Even further the smartest robots don’t even have to just blindly replicate human interaction with an existing system, but can go one step further and robotise across business and IT processes in their entirety and therefore challenge business decision makers to see what could be done.
Harnessing smart robotic automation
There are even different levels of robotic process automation. There are robots that focus on a specific part of a task and simply assist or mimic human activity, and then there are smart robots that have the power to replace human effort across processes end-to-end.
These smart robots use in-built intelligence (predefined best practice rules) to make decisions and they only need to notify their supervisor if and when human intervention is required.
It may sound like a term from a sci-fi film but smart robotic automation is here and already in use. Smart robots achieve savings greater than any salary arbitrage and they deliver best practice processes.
They provide improved accuracy and increased productivity – all without the manual effort across end-to-end processes. The benefits of robotic process automation do not just apply to shared services. For companies that onshore, offshore and re-shore the same improvements in accuracy, production and quality can be achieved.
Take the financial close process, a complex activity that all large organisations must tackle, whether onshore or offshore. Our recent research with the Hackett Group found that 55% of even the Top Performing companies – which have already adopted a broad range of best practices to optimise the close – struggle with work-load levelling over the month, with 45% admitting that this leads to staff working overtime.
The research found that top performing companies cut the human effort required to close the books but still recognise the opportunity to remove that effort further. This is where smart robotic automation comes in.
Welcoming a fourth industrial revolution
To remain competitive and sustainable, outsourcers and shared services centres need to adjust their business model. Indeed, the factors that were once the proven benefits of offshoring (such as freeing up internal resources, mitigating risk, delegating mundane processes and saving time and cost) are now the biggest drivers towards EPA as companies seek greater efficiency, accuracy and productivity in their business operations.
Bank of America Corp. calculated that the adoption of automation and robots and artificial intelligence could boost productivity by 30% in many industries, shedding light on the raising productivity expectations that are accompanying this trend.
Gone are the days of offshoring or strenuous manual effort in core processes such as the financial close. True robotics with no manual intervention, offers the consistency, accuracy and speed that businesses need to stay afloat in the competitive global marketplace of today.
Smart robotics and the advent of 'Cybershoring' will be here to stay and those that see the potential of what can be done versus constrained by what has always been done, will enjoy continued growth in the Fourth Industrial Revolution.
Sourced from Neil Kinson, VP EMEA, Redwood Software