Supercharge Your Process Excellence Strategy
2018 is to robotic process automation what 1994 was to the Internet — an auspicious start, but we ain’t seen nothing yet!”
The understanding and implementation of Process Excellence has matured rapidly over the past decade to the point where it is a core feature of any long-term business strategy. However, after so many years of leveraging established PEX methodologies, many companies now find that they are experiencing diminishing returns as their operations become increasingly lean and optimised.
Business leaders who find themselves in this predicament are now looking beyond traditional PEX strategies towards the next step in the cycle. Increasingly, it looks as if the benefits of automation –as delivered by the use of robotics technology — will provide this paradigm shift in the way PEX is implemented.
Shifting from Outsourcing towards Automation
Companies have historically outsourced production work to countries with lower labour costs, such as China. As labour costs soar across the world, including in China, the economics of outsourcing becomes very murky. By adopting automation, countries with rising labour costs can get and stay competitive, and can continue to produce affordable products to serve their end customers.”
Admittedly, robotics has its detractors who believe that developing its true potential will take years if not decades. There are others who believe that leveraging robotics effectively is already within the reach of mature enterprises with high operational agility. No matter which side of the fence you currently sit, a growing number and diversity of companies are already achieving huge efficiency improvements through the use of this technology.
As global labour costs continue to rapidly rise, outsourcing is gradually becoming less cost effective. This is as true for business process management as it is for manufacturing and a wide range of other industries. On the other hand, robotic process automation (RPA) is becoming more cost effective, that is according to Everest Group’s Finance and Accounting Outsourcing Annual Report 2014, which states that robotic automation tools are up to 65% less expensive than offshorebased full-time employees (FTEs).1
As this balance continues to shift in favour of automation and a growing number of companies begin leveraging it, automation will become an essential tool in order to stay competitive. As a result, companies of all sizes will need to familiarise themselves with its benefits and potential implementation strategies.
Key benefits of RPA
Boosted productivity and efficiency
Robots can work 24/7, 365 days a year, with no breaks, annual leave or attrition, resulting in reduced cycle time and enhanced productivity.2 Research estimates that by the year 2025, the widespread implementation of advanced robotics will allow up to a 30% productivity boost in key global industries that adopt RPA.3
Reduced labour costs
Once the initial outlay is accounted for, companies investing in RPA can look forward to significantly reduced labour costs. Overall, leading exporters of goods and services such as China, the US, Japan and Germany are expected to have their total labour costs lowered by approximately 18% by 2025.4
Eliminating human error
For vital but repetitive tasks where accuracy is key, RPA is an excellent alternative as it ensures that no mistakes are made due to tiredness or inattentiveness. In Singapore, public hospitals are already utilising advanced RPA technologies to pick out and assign drugs to patients based on their bar codes, update stocks automatically and issue an alert when stocks run low.5 This technology will prove especially useful for other industries looking for new cost effective ways to become compliant with regulatory standards and practices.
Moving up the value chain
By eliminating the need for human employees to perform dull, repetitive tasks, companies can encourage their staff to take on different roles that are better at creating value in an age of automation.
Steps towards RPA Implementation
The benefits of digital labour are rapidly eclipsing the benefits of physical labour and service providers can choose or decline to translate that into success.”
Assess the RPA Potential for your Company
It’s essential for any company that decides to implement RPA to fully understand what robotics technologies are capable of and where they might fit into their operational process. The key factor is to determine what is appropriate. For example an initial small-scale tactical deployment that can be used to showcase the technology’s potential is often preferable to an ambitious mega-project. Achieving tangible results early, not matter the scale of your project, will help persuade senior executives who are wary of a “silver bullet solution” that may fail to deliver.
Implementation
Choosing the right robotic automation team with the appropriate level of resources and oversight is critical to the success of this stage. It’s vital to clarify exactly how the RPA implementation project will fit into the company’s daily operations. All relevant departments will need to understand what’s expected from them in terms of resources, commitments and their day-today engagements with the RPA team. It’s equally vital for all relevant departments to know who the project’s business sponsor and process owners are.
Sustain and Scale
Once implemented, RPA technologies should begin to have a noticeable impact on operational efficiency and productivity while securing a host of additional benefits. These newly incorporated robotic processes will then need to be sustained effectively in order to derive the maximum benefits from them. Subsequently, once their ROI and ongoing value has been clearly proven, they can be scaled up to further enhance the company’s PEX strategy in an even more ambitious manner.
Key Challenges to Overcome
Creating a Viable Road-map for RPA Implementation
In order to effectively sell the vision of how RPA, it’s essential to know not only how the process will begin, but also understand the various stages it will undergo over time. The necessary resources and support will be obtained more easily and readily from the company’s leadership if they are able to envisage the company’s RPA journey via a well-articulated and realistic road map.
Demonstrating ROI and Securing Executive Buy-in
As previously mentioned, RPA has its detractors and not every company will see its benefits being applicable to them. The successful delivery of a small-scale tactical RPA project can help allay those fears and demonstrate the potential of automation technology to improve PEX across the entire company’s operations.
Accurately Measuring Success
In order to move from initial tactical projects to a companywide adoption of RPA, it’s essential to be able to show exactly how much of an impact it has made. To ensure this is possible, RPA implementers need to develop a benefits register to track the reduced operating expenditure of business units and departments as well as the ongoing value delivered to the enterprise as a whole. Recording success stories of specific employees is another viable approach; demonstrating their ability to work more efficiently once they’re freed up from their previous repetitive and time-consuming tasks.
RPA: The Evolution of PEX Strategy
The difference between RPA and traditional business process automation could be likened to a driverless robotic car versus a car using cruise control.”
In today’s rapidly changing economic climate, companies need to achieve more with fewer personnel in order to stay competitive. Due to the significant benefits offered by RPA, it is increasingly being accepted as the next step in the evolutionary cycle of PEX, just as outsourcing was the new paradigm over a decade ago. As a result, the pressure is on for companies across all industries need to start considering how RPA will fit into their operational landscape, whilst being mindful of the key challenges and best practices for success.
