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Robotic Process Automation – Pragmatic Solution or Dangerous Illusion?

  • June 2017
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Mathias Kirchmer at University of Pennsylvania
Mathias Kirchmer
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Robotic Process Automation (RPA) has become an important trend in process management and automation. The article examines briefly the value it delivers and associated risks. On this basis it recommends a company specific approach to maximize RPA value and minimize risk.
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Robotic Process Automation – Pragmatic Solution or Dangerous Illusion?
By Dr. Mathias Kirchmer,
Managing Director and Co-CEO, BPM-D
Affiliated Faculty, Program for Organizational Dynamics, University of Pennsylvania
Abstract
Robotic Process Automation (RPA) has become an important trend in process management and
automation. The article examines briefly the value it delivers and associated risks. On this basis it
recommends a company specific approach to maximize RPA value and minimize risk.
Key Words
Business Process Management, Execution, Process Automation, Process of Process Management,
RPA, Robotic Process Automation, Strategy, Value Realization
Digitalization changes dramatically the way organizations operate. New digital tools are available almost
every day – and many of them have the potential of a major impact. They enable the transformation of
business processes to become more efficient, agile, meet compliance requirements, enhance customer
experience or improve the general quality of deliverables. They may help achieving a process
performance you would never have thought of before. Robotic Process Automation (RPA) is one of those
digital enablers. And it is one that has created quite a bit of interest in the past months. It could become
a mainstream trend relevant for many businesses.
What is Robotic Process Automation?
RPA tools are software programs that operate on the user interface of other computer systems in the
way a human would do [1]. They basically recognize and read fields on a screen of an application
software, modify the content if necessary and enter it into other fields of the same or different software.
All of that happens based on predefined rules [2]. The integration of artificial intelligence (AI) and
Cognitive Automation components into the RPA tools makes them even more powerful since RPA starts
handling unplanned situations and deal with unstructured data. Also the handling of verbal information
is possible using “Chatbots” in an RPA environment.
The use of RPA basically transfers the application of robots from the industrial manufacturing
environment to the office and service area. Just like industry robots automate routine manufacturing and
assembly steps RPA robots automate the human work with data and information.
What is the typical Value of Robotic Process Automation?
In practice RPA has already shown significant, impact mainly by increasing efficiency through the
reduction of workforce or better the replacement of human workforce through “digital workforce”. The
check of vendor invoices, handling of routine insurance claims, or the processing of loan applications
are just a few examples where RPA has been used successfully. In general non value-added working
steps are automated, improving process efficiency significantly, often by 40% and more [3][4]. This is
combined with other benefits like the reduction or even elimination of errors entering data, enforcing of
compliance rules, scaling data handling capacity “on demand” or reduction of cycle times.
RPA can also add value in the technical field of software integration. The tools can read the data
produced by one application and enter it into another one, achieving an integration effect without
developing costly interfaces or changing existing software. This leads to efficiency effects in the
information technology department and provides business users the required integration to enhance
process performance.
In the meantime RPA solutions are offered by a continuously growing number of vendors. The Gartner
Group, for example, mentions 15 vendors in their RPA market guide [5]. RPA software is offered often
at an aggressive pricing or even for free. Also implementation cost start at a relatively low level. All this
makes RPA look like a pragmatic and powerful solution. As a consequence more and more public and
private organizations use or plan to use RPA.
What are Risks related to Robotic Process Automation?
While all this sounds promising, the use of RPA creates also some risks, like basically every automation
technology does. While RPA helps to do routine work faster and at a higher quality it also can make
mistakes faster and with certainty. There is no human check before executing an action. Poor data quality
or the insufficient definition of business rules can lead, for example, to the ordering of the wrong parts –
fast and in big quantities. Or missed claim types can lead to significant rework in the claims handling,
overcompensating the automation benefits. RPA requires detailed knowledge about the business
process it is used in – otherwise expected performance improvements will not be realized.
The use of RPA may also just cover symptoms without correcting the real reasons for issues. RPA may,
for example be used for the automated reconciliation of account differences. However, in the mid and
long-term it would be much more beneficial to correct the issues leading to those differences. Hence,
RPA may hinder real progress.
RPA vendors stress that their tools are easy to implement and use – also for a business person. This
may be right for simple straight forward applications. However, to achieve full potential of sophisticated
RPA environments some expert know how is required for implementation and ongoing adjustment [2].
This should be part of the process management capabilities of the organization or RPA expectations
may not be met or not met fully.
These potential risks can make RPA a dangerous illusion. However, those risks can be minimized by
addressing RPA the right way.
How can I reach my goals with RPA?
In general it is important to evaluate RPA in the context of your organization, its goals, challenges and
process management capabilities. The use of a digital technology is never about the technology itself
but about the relevant business impact. To have a clear idea about those goals and how they relate to
your business processes and the potential value of RPA is a simple but important precondition for the
successful use of RPA. You can segment your processes to identify where you get best value by
improving their maturity level through RPA [6].
Once you have identified a process you want to improve using RPA, it is key to create the necessary
transparency. In the relevant functions the process needs to be understood “on field level” and required
business rules based on this data have to be defined. Hence, formal process and rules or decision
modelling play here a key role. Organizations can use their “process factory” or apply at least a simple
but structured modelling approach [7]. This allows to “teach” RPA robots the best possible way and avoid
the fast repetition of mistakes or rework. The model-based transparency ensures that you do not just fix
symptoms where a different solution would deliver better and sustainable results.
A simple process management discipline supports the value-driven implementation and ongoing agile
use of RPA [8][9]. It needs to become part of a pragmatic “process of process management” that
transfers strategy into execution, fast and at low risk. That means a basic process governance is required
as well as a systematic implementation and value realization approach, in addition to the capabilities
discussed before. Applying a simple and pragmatic process of process management realizes the
expected value of RPA while minimizing the risks. The components of the process of process
management especially important for a successful use of RPA are sown in figure 1 [8].
Figure 1: The Process of Process Management with Components especially important for RPA [8].
RPA is about to become a key component of a value-driven process management discipline. Applied in
the right context it enables powerful and pragmatic solutions to selected process automation and
integration challenges.
References
[1] Wikipedia (ed.): Robotic Process Automation. In: Wikipedia.org, 2017.
[2] Harmon, P.: Robotic Process Automation comes of Age. In: BPTrends.com, June 2017.
[3] WorkFusion (ed).: Solutions. In: WorkFusion.com, 2017.
[4] AutomationAnywhere (ed.): Genpact partners with AutomationAnywhere to deliver Robotic Process Automation – An
AutomationAnywhere Case Study. 2017.
[5] Tornbohm, C.: Market Guide for Robotic Process Automation Software. Research Report of The Gartner Group, 07 Nov 2016.
[6] Kirchmer, M., Franz, P.: Targeting Value in a Digital World. BPM-D Whitepaper, Philadelphia, London 2015.
[7] Kirchmer, M.: High Performance through Business Process Management – Strategy Execution in a Digital World. 3rd edition,
Berlin, New York, e.a. 2017 (in publication by Springer)
[8] Kirchmer, M., Franz, P.: The Process of Process Management – Strategy Execution in a Digital World. BPM-D Whitepaper,
Philadelphia, London 2016.
[9] Franz, P., Kirchmer, M.: Value-driven Business Process Management – The Value-Switch for Lasting Competitive Advantage.
New York, 2012.
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... Similarly, research in the area of RPA has tended to focus on benefits, suitable use cases and implementation methods. Much of the work has espoused its benefits including: easy and fast set up [3], [37], increased productivity and efficiency [9], [15], [16], growing the digital workplace [16], increased accuracy [9], [15], [16], lower reliance on IT workforce [10], rapid scale up and easing IT workloads [3], allowing people to do more interesting work [16], [33], and facilitating system integrations that were not previously possible [37]. ...
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Genpact partners with AutomationAnywhere to deliver Robotic Process Automation -An AutomationAnywhere Case Study
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  • Automationanywhere
AutomationAnywhere (ed.): Genpact partners with AutomationAnywhere to deliver Robotic Process Automation -An AutomationAnywhere Case Study. 2017.
Market Guide for Robotic Process Automation Software. Research Report of The Gartner Group
  • Nov 2016
  • 7
  • C Tornbohm
Tornbohm, C.: Market Guide for Robotic Process Automation Software. Research Report of The Gartner Group, 07 Nov 2016.