Monthly Archives: May 2017

Spot the difference – Robotic Process Automation and Digital Transformation

 

 

 

 

 

 

 

 

 

 

 

 

I have noticed a number of conference invitations on the joint theme of Shared Services and Digital Transformation, and when you look at the agendas there is often a big emphasis on Robotic Process Automation (RPA). Are RPA and Digital Transformation one and the same, or are there some fundamental differences to be aware of?

RPA is certainly an important tool in the shared services armoury, and we are seeing increasing breadth both in use cases and in the scope of processes which are being automated. RPA is also proving its worth as a fast and cheap solution to back office systems integration challenges.

RPA is enabling the optimisation of key activities within the end-to-end flow of business processes, through the increasing automation of data capture, data enrichment, data validation, processing, reconciliation and analytics. Software Bots, which are created to undertake these activities, are becoming increasingly sophisticated. Once the initial investment in Bots has been paid off, there can be substantial cost reductions in ongoing operations, often accompanied by quality improvement in mundane task execution.

While RPA now covers an impressive breadth of processes, in many cases the business process which has been first cab off the RPA rank has been Accounts Payable. Shared Services historians will tell you that Accounts Payable was also one of the earliest processes to come within the remit of Shared Services.

But I do question whether this keen focus on process optimisation and cost saving really does equate to Digital Transformation.

Digital Transformation is surely a programme which takes place at the enterprise level, and reinvents the enterprise’s touch points, primarily with customers, and also with partners, suppliers and employees. Digital Transformation has the potential to disrupt and change markets, transforming not only customer experiences but also the whole fulfilment chain of creating, selling and delivering products and services. Digital Transformation harnesses technology enablers such as Big Data Analytics, Cloud, Internet of Things, and often stimulates the design of new Enterprise Architectures.  It is about technology, processes and data, but it is also much more than that – it is about people, organisation, culture and business vision.

If we take Finance and HR Shared Services, typically these consist of back office processes, at one or more remove from direct customer contact. They deliver key elements of an enterprise’s management processes, but they do not normally touch the sharp end of sales or product / service fulfilment. If we accept that Digital Transformation is primarily about reinventing the way that an enterprise sells and delivers products and services to its customers, then I struggle to see how the RPA of parts of say the Accounts Payable process or the Employee Training Course Booking process – worthy though they are – can claim to represent Digital Transformation.

This is not to say that Finance and HR do not have a vital role to play in enterprise Digital Transformation. But to play that role they need to look way beyond the automation of manual steps in their own back office processes.

Finance needs to think about how it can get the right data at the right time to people at the front line of the business, on an accessible device. The data needs to transcend organisational silos, while not compromising security, and it needs to be integrated, well analysed and easy to visualise. Where the fulfilment chain involves partners and suppliers, Finance should be getting together with them to reinvent end-to-end data flows. Finance also needs to help the business to create business cases for transformation and to measure the delivery of benefits, in rapidly changing and often experimental environments.

HR needs to champion the case for organisational and cultural change, recognising that enterprise Digital Transformation carries risk for the people charged with delivering it, and also for the people whose operational jobs and perhaps “empires” are impacted by it. HR needs to promote and enable new ways of working, and to reflect these both in the policies and procedures of the enterprise and also in the way that the enterprise presents itself to potential new “digital native” recruits.

Both Finance and HR also need to be able to lend high quality experts to the business, in support of enterprise Digital Transformation programmes, people who bring core Finance and HR skills and who also understand agility and the importance of customer experience. This is not to throw away the key corporate disciplines which protect shareholders and management, but to adapt them to ensure that they remain fit for purpose.

In conclusion, RPA within a Shared Service centre contributes to the effective and efficient running of the enterprise, and can also deliver cost savings which can then be reinvested in transforming the front of the business. However, RPA should not be seen as the same as Digital Transformation. If Finance and HR, the typical owners of Shared Services, wish to play an influential role in the Digital Transformation of the enterprise, then they need to look beyond the process maps of their own back office operations.