AI & Automation are playing a major role in transforming businesses

Criticization and appreciation is a part of the game. And, something similar is happening with disruptive technologies such as Artificial Intelligence (AI) and advanced automation. Many see it as a force of change which will lead to growth, whereas few others criticize disruptive technologies for being the reason of job loss.

Putting aside all such debates, it is high time to admit that disruptive technologies have led to new forms of competition and it has become imperative for businesses to duke it out. However, if we turn history pages, we will be convinced that automation has always led to the creation of a new set of jobs. It is only that transformations in technologies demand patience, as it takes some time for the transition waves to settle down.

Similarly, advanced automation and Artificial Intelligence (AI) are in its stage of evolvement but at the same time, it has also encompassed people, businesses, and economies. It opens the world of enormous opportunities – where businesses can evolve at an incredible speed and the workforce can learn new skills to perform modern-day business operations.

According to a report published by Accenture, “companies that will grow and dominate their industries will be those that systematically embrace automation across their organizations using it to drive the changes to their products, services, and even business models as they continue to transform themselves and their industry.”

Advanced Automation Set to Change Business Landscape

Processes are becoming efficient, dependency on the human workforce has significantly reduced, tasks are being completed with more accuracy and precision, customers get an engaging and interactive platform – Artificial Intelligence (Ai) and advanced automation are changing the business landscape at an unprecedented speed.

It won’t be wrong to say that these disruptive technologies introduce a paradigm shift in the way companies function and the human workforce carry out diverse business activities. Enhancing efficiency is not the only aim, but with advanced automation, businesses can go beyond traditional boundaries of maximising productivity and profitability. Disruptive technologies rather support in long term growth of business organizations, where main focus lies on building a personalized relationship with customers, becoming a brand, delivering true value and enhancing customer loyalty and retention. In short, disruptive technologies such as intelligent automation enables business in remaining fit for even future performances.

Time for Humans to Team-Up with Their Digital Co-Workers

Gone are days when humans guided machines to perform various business operations. With cognitive abilities turning into a reality, it is the automated business system that guides the human workforce. Programmed machines are now performing tasks exactly as a trained employee. And, in some cases better than them.

With cognitive abilities, advanced automation solutions enable the business system to analyze and respond in an urgent situation. This gives businesses a responsive platform, which supports businesses in eliminating performance bottlenecks both inside and outside the organization. As a result, streamlined process supports in seamless business workflow, which significantly helps in achieving organizational goals efficiently.

It is high time the human workforce must team-up with their new digital co-workers. And, it can bring innumerable benefits for them. Programmed machines share much of the workload; employees get an opportunity to learn new skills required for modern business processes; advanced automation saves much of their time, which enables them to be more creative while performing diverse business tasks.

Benefits that Businesses Can Gain

Technologies have always supported business organizations in performing operational and productional activities. But with evolving technologies such as advanced automation, it is time for businesses to reap innumerable benefits.

Advanced automation solutions are designed with advanced business models such as SaaS, Six-Sigma, and Lean production. There various proven business models together play a key role in cutting operational costs. By enabling in updating the business system with the latest development in technology, ability to control entire business activity even from a remote location, supporting in optimum resource utilization and many more – advanced automation solutions in cutting costs by a great margin.

Disruptive technologies are being widely recognized for making business processes robust and efficient. With approaches such as Six-Sigma businesses can ensure that tasks are completed within allocated budget and time; variations in finished product and other services are kept to a minimum level, and most importantly it supports in reducing the error-rate. Lean production, on other hand, supports in eliminating wastes from processes which further aids in achieving organizational goals successfully.

Besides, advanced automation also enables in creating an interactive and engaging platform for customers. With automated processes such as Sales and Marketing, businesses can ensure that customers are informed of sales, discounts and other promotional offers right on time. Customers can put their queries and businesses can deploy advanced measures for an instant solution. This encourages customers to be loyal and also largely impacts their buying decision.

Therefore, it won’t be wrong to say that disruptive technologies enable business in performing robustly at all fronts. With competition getting steep, technologies such as advanced automation is key to success as it can play a larger role in delivering complete satisfaction to customers.

AI and Automation Is the Greater Force

With advanced automation technologies transforming businesses at a breakneck speed, leaders are set to gain a wider market share. As the report published by Accenture further informs “Intelligent automation will enable enterprises to innovate and evolve by increasing their agility, reducing the complexity of systems and operations, accelerating their time to market, and creating the ability to experiment continually with new products and services.”

In the prevalent technology-driven environment, businesses cannot grow using traditional business approaches. They should rather adapt to the change introduced by the new age disruptive technologies. Embracing intelligent automation, companies can drive demands and can successfully deploy advanced business methods to fulfill customer preferences.

Technological solutions are playing a larger role in transforming businesses and is helping them in securing long-term growth. But what matters is – how soon business leaders realize this fact that AI and intelligent automation solutions are the greater force, which can in no way be overlooked?

Source: itproportal-AI & Automation are playing a major role in transforming businesses

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Turning the ship toward automation

My recent post about whether the proportion of offshoring in a sourcing portfolio matters anymore got a lot of attention. As I wrote in that piece (“Why Offshoring Doesn’t Matter“), sourcing buyers are eager to incorporate automation into their environments, but some service providers are struggling to adapt to the new digital world, largely because that pivot requires them to cannibalize existing revenue to implement automation and digitization. Not only does the financial impact slow them down, so do their corporate cultures.

Let’s take a look at the obstacles to automation from a service provider’s perspective:

1. The risk of changing. Traditional service providers have built their businesses selling services that are delivered by people. Even if the price of automation was the same as the price of people (which it is not), revamping an entire portfolio is a big job. And selling services that are entirely new to the market is risky. Service providers that embrace automation risk underbidding the solution and losing money or paling in comparison to a competitor that already has it figured out.

Despite the risks, service providers today cannot afford to stick their heads in the sand. Even cautiously adding digitally automated components to a solution at or close to renewal time is not enough to keep up with changing market demand. The fact is, buyers are not looking for service providers that are lukewarm about automation; they are finding and investing in service providers that embrace it.

And many service providers are investing in digital, automated solutions, as I was fortunate enough to see during a recent tour of several campuses. What remains unclear is whether their sales forces and internal bureaucracies are as willing to embrace the change as their technologists.

2. The challenge of changing. Turning the barge is hard. Service providers have built efficient machines that keep hundreds of thousands of people busy day in and day out. Their cultures emphasize safety over risk. Offering cost-effective services by following carefully-laid-out processes (considered safe) is often seen as preferable to investing in innovative, new solutions (considered risky). Service provider management bonuses are tied to profitability, and profitability is tied to keeping big workforces busy. Career paths at these firms have been designed for engineers who graduate from writing and maintaining systems to managing people who write and maintain systems.

We are now at a point where conformity to process can be a barrier to progress. Yet, for most service providers, the prospect of overhauling an entire business model is daunting. How will managers earn bonuses when their clients demand fewer people, not more? What would management even look like if it involves supervising software robots? Knowing the magnitude of this kind of change, and knowing what we know about human nature, it’s easy to see how such an obstacle will not be easy to overcome.

Some argue that demand for advances in internet of things (IoT) technologies, automation, cognitive computing and digitally savvy robots will keep the legions of developers at IT services firms busy for generations — they will simply write different kinds of solutions than they do today.

And while this may be true, most traditional service providers will struggle in the transition from today’s business model to tomorrow’s. They may understand what is happening in their markets, and they may understand the technology that’s required to meet the new demands of their customers, but they are still saddled with an infrastructure built around people-based services.

The nature of the challenge itself is new to service providers. I have no doubt they possess the technological wherewithal to compete in tomorrow’s market. Will they recognize that the barriers are cultural? Or will they try to solve what is fundamentally a behavior challenge with more technology and more people?

In this new era, I give the smaller players the advantage. Changing the hearts and minds of 10,000 people is a lot easier than changing the hearts and minds of 100,000 people.

Source: cio.com-Turning the ship toward automation

Ethical Automation Decisions in An Age of Digital Disruption

Intelligent automation technologies, including robotic process automation (RPA) and artificial intelligence (AI), offer transformative opportunities for companies to shift the ways organizations do everything from running operations, moving through the supply chain and serving customers.

But making decisions about digital labor — that is, an automated workforce with capabilities to complete work that largely mirrors our own abilities — cannot be taken lightly. These efforts can have enormous and lasting effects on your workforce, on communities and on the entire world — so they require significant thought and preparation, including digging into a company’s deepest core values.

“Companies need to monitor the evolution of digital labor in order to guide their decision-making,” says Todd Lohr, principal, U.S. Intelligent Automation Leader at KPMG. “They have to think about the profound impact of technology on their business, from how the work is done to who is doing the work, job replacement considerations, to the evolution of jobs and how it affects the work environment.” He believes these efforts are the next wave of corporate sustainability, as more and more research shows that buying preferences are based on the perceived ethics of organizations.

The IT organization has a pivotal role in this, adds Cliff Justice, principal, Innovation & Enterprise Solutions at KPMG. The CIO is often charged with ensuring new technology is in line with company values; to ensure data systems are fed are not compromised and that data would not lead systems to learn the wrong things. “The biggest mistake companies can make is to not include IT and CIOs in these decisions from the outset,” he says.

In a new paper authored by Lohr and Justice, An Ethical Compass in the Automation Age: Decisions Require Deep Dive into Company Core Values,” they hone in on a variety of ways organizations can begin to tap into company core values and processes or create new ones as the ethical compass to guide automation decisions, including:

  • Start the ethical discussion within the company. Have frank conversations about the potential impact of each decision. The recent Corporate Responsibility Survey sponsored by Aflac found that 83% of professional investors are more likely to buy stock in companies well known for social responsibility believing these companies are lower risk investments.
  • Define or update the company’s core values. Some companies talk about taking care of their employees and providing value for customers as a part of core values, or focus on safety, environmental and community impact. Making these tough automation decisions pushes existing values and processes to the limit, so explore expanding on these to encompass major business model changes with digital labor.
  • Consider how your core values extend into your technologies. It is critical to encode company values in the technology, because artificial intelligence and data can have bias that can contradict your core values and beliefs. “It’s important that the core basis of ethical decision making be built into a company’s algorithms — so it is not based purely on mathematical logic or statistical data, but instead what is deemed appropriate in terms of societal norms,” adds Cliff Justice.
  • Follow through by establishing metrics to track the residual effects of automation. Many organizations create a Center of Excellence to manage governance. More important is establishing organizational change management programs for employees to help workers learn how to work with new technologies.

Overall, companies need to determine their overarching strategy to deal with the ethics of automation: “They need to weigh some of what they’re hoping to get out of it,” says Lohr. “There are short-term and long-term impacts on the operating model and a lot of decisions will hit corporate sustainability standards, enterprise strategy and overall corporate policies.”

Paving New Ground with Automation: The Early Tip of Change

“Digital labor and automation efforts are new and quickly-evolving, so companies are seeing only the early tip of the disruptive changes that will unfold over the next generation,” says Justice. As a result, discussions about the ethics surrounding these new technologies are just beginning. “We’re paving new ground, and there isn’t a playbook, or a lot of case studies out there,” he says. “We have never had a wave of artificial intelligence sweep through mainstream business in the past — that’s the reason we’ve decided to share what we’re learning as we go through this in our own enterprise.”

All companies, however, need to start addressing these dilemmas, as automation-centered industry disruptions happen faster and more often: “More and more CIOs feel the urgency to be the disruptor as opposed to disrupted,” he adds. As companies deal with a new class of technologies on a new class of platforms and offer services and products that have traditionally been offered through different business models, organizations need to consider how they want to work. Issues related to automation and digitization overall will be some of the biggest decisions CIOs have to face.

“With automation, organizations need to start thinking further ahead about technology, people and culture than in the past, because the disruptive impacts are so significant,” says Justice. No industry is immune to new operators coming in on cloud platforms and moving into traditional businesses. “They have to determine the extent to which they will transform and protect their business growth while maintaining their culture and taking care of employees and customers, as well as maintaining their brand and values in the market,” he adds.

According to the paper, Justice and Lohr agree it’s up to companies to have these discussions and make tough decisions regarding the ethics of automation: “We believe in the power of corporate leaders to make the right choices. With the right tools, knowledge and attention, technology can be the great enabler. But company and personal ethics must serve as the compass. You are the steward of powerful technology. It’s up to you to use it right.”

Source: CIO-Ethical Automation Decisions in An Age of Digital Disruption

Robotics: an alternative view – Intelligent Sourcing

It has a lot of good points. Unemployment is down, so if the robots want to take our jobs they’re being uncharacteristically inefficient about it; it also points out that automation has always forced jobs to evolve and the current wave of automation is no exception. There is a perception of employment vanishing because of deserted high streets and closed shops in malls, but the service industry, languages and soforth have never been more fruitful.

Well…yes. All of this is correct, but it doesn’t make life any easier if you’re in the middle of it.

Call for retraining

Let’s say you were working in a big chain of shops. Your people skills are excellent, you’re a little more senior than some so you can do stuff like mental arithmetic. You don’t have to rely on the till to add things up – customers can see you know what you’re doing. And you made best salesperson of the month just about every month last year.

The store, meanwhile, is on the hit list of stores to close. You’re offered an alternative position in Arkensas; unfortunately you’re in California and that’s quite a commute. It’s OK though, because the company is growing so there will be back office positions and web marketing opportunities and the overall head count will be larger than it was before.

You have none of those skills and your store is closing.

Intelligent Sourcing is not saying these changes shouldn’t happen. We’re not saying they should be resisted, they are inevitable. The point we’d make, though, is that it’s glib for media, analysts and academics to point to growth in overall jobs and to take no account of the people on the ground who find their job is growing in a direction that no longer works for them. This is, in part, how you get to the resentment felt by a lot of working people worldwide when they get told that their economy is booming and it’s all wonderful when they don’t know how they’re going to afford to eat in the longer term.

The substance of the NYT article is correct. Change is inevitable and after a period of settling down, it’s almost always pretty neutral for the total amount of jobs available. However, for the people in the jobs that are fading away, we’d urge sensitivity – and better than that, we’d call for an active effort to invest in retraining and redeployment. At the moment a lot of them feel fobbed off with statistics and figures they don’t recognise from their experience, and that’s no good for anyone.

Source: intelligentsourcing.net-Robotics: an alternative view – Intelligent Sourcing

Thinking Through How Automation Will Affect Your Workforce

Today, executives have to cut through a lot of hype around automation. Leaders need a clear-eyed way to think about how these technologies will specifically affect their organizations. The right question isn’t which jobs are going to be replaced, but rather, what work will be redefined, and how? Based on our work with a number of organizations grappling with these issues, we’ve found that the following four-step approach can help.

1. Start with the work, not the “job” or the technology. Much work will continue to exist as traditional “jobs” in organizations, but automation makes traditional jobs more fluid and an increasing amount of work will occur outside the traditional boundaries of a “job.”

Optimally integrating humans and automation requires greater ability to deconstruct work into discrete elements — that is, seeing the tasks of a job as independent and fungible components. Deconstructing and then reconfiguringthe components within jobs reveals human-automation combinations that are more efficient, effective, and impactful. AI and robotics increasingly take on the routine aspects of both blue and white collar jobs, leaving the non-routine to humans. That challenges the very essence of what organizations retain as human work. The reconfiguration of these non-routine activities will yield new and different types of jobs.

2. Understand the different work automation opportunities. AI can support three types of automation: robotic process automation (RPA), cognitive automation, and social robotics.

RPA automates high volume, low complexity, routine administrative “white collar” tasks — the logical successor to outsourcing many administrative processes, further reducing costs and increasing accuracy. Optimizing RPA can only be done when the work is deconstructed. For example, RPA will seldom replace the entire “job” of a call center representative. Certain tasks, such as talking a client through their frustration with a faulty product or mishandled order will, for now, remain a human task. Others, such as requesting customer identification information and tracking the status of a delivery are optimally done with RPA.

Cognitive automation takes on more complex tasks by applying things like pattern recognition or language understanding to various tasks. For example, the Amazon Go retail store in Seattle has no cashiers or checkout lanes. Customers pick up their items and go, as sensors and algorithms automatically charge their Amazon account. Automation has replaced the work elements of scanning purchases and processing payment. Yet other elements of the “job” of store associate are still done by humans, including advising in-store customers about product features.

Social robotics involves robots moving autonomously and interacting or collaborating with humans through the combination of sensors, AI, and mechanical robots. A good example is “driverless” vehicles, where robotics and algorithms interact with other human drivers to navigate through traffic. Deconstructing the “job” reveals that the human still plays an important role. While the human “co-pilot” no longer does the work of routine navigation and piloting, they still do things like observing the driverless operation, and stepping in to assist with unusual or dangerous situations. Indeed, it is often overlooked that the human co-pilot is actually “training” the AI-driven social robotics, because every time the human makes a correction, the situation and the results are “learned” by the AI system.

3. Manage the decoupling of work from the organization. The future global work ecosystem will offer alternative work arrangements including each of the three automation solutions, along with human work sources such as talent platforms, contingent labor, and traditional employment. The human work that is created or remains after automation will not fit easily into traditional jobs, nor will it always be optimally sourced through employment. Work will need to be freed from “jobs within organizations,” and instead be measured and executed as more deconstructed units, engaged through many sources. Today’s supply chainstrack the components of products at both an atomized and aggregate level. Similarly, the new work ecosystem will develop a common language of work, enabling organizations not only to forecast and meet work demands from various sources, but to devise new reconfigurations of work elements that are best sourced in alternative ways.

4. Re-envision the organization. The combination of automation, work deconstruction, and reconfiguration will often redefine the meaning of “organization” and “leadership.” The “organization” must be reconsidered as a hub and capital source for an ecosystem of work providers. Those “providers” include AI and automation, but also include “human” sources such as employees, contractors, freelancers, volunteers, and partners. The optimal combination of these providers seldom appears if you frame the question as, “In which jobs will AI replace humans?” Only when you look within those jobs, as described above, will you discover the human-automation combinations that redefine work and how it should be organized.

AI will significantly disrupt and potentially empower the global workforce. It won’t happen all at once or in every job, but it will happen, and leaders will need an automation strategy that realizes its benefits, avoids needless costs, and rests on a more nuanced understanding of work.

Source: HBR-Thinking Through How Automation Will Affect Your Workforce

Rethink How Humans and Machines Will Work Together

Rethink How Humans and Machines Will Work Together

Productivity gains from automation are not resulting in job losses, but are enabling companies to redeploy employees to handle higher-value tasks and a greater volume of work.

Automation is creating a polar shift in how work gets done. While technology assists human intelligence today, in the digital organization of the future, intelligent technology will be assisted by humans.

Already, automation is eliminating what I call “swivel chair” work: the mundane, manual cut-paste-and-compare work people have been forced to do between disparate enterprise applications, spreadsheets and scripts.

Such tasks are now being performed by digital robots. Indeed, almost any business process that interfaces digitally and follows standardized business rules can be easily automated. The fact is, robots are better at following rules-based processes than their human counterparts. That is, until they come across a situation that does not follow the standard protocol or requires cognitive decisions beyond repetitive process rules. This is where human teammates provide the needed support to their digital partners and where higher-value decision making is required.

That polar shift

When humans come face-to-face with the polar shift, they usually have a range of responses, from elation at the prospect that unwanted activities can be eliminated, to fear and uncertainty regarding job security.

Yet concerns about job loss are usually overblown, at least at the moment, according to recent research from ISG. The ISG Automation Index found the application of Robotic Process Automation (RPA) is enabling enterprises to execute business processes five to ten times faster, with an average of 37% less labor, as measured by full-time equivalent (FTE) resources. Such productivity gains, the report said, are not resulting in job losses, but are enabling companies to redeploy employees to handle higher-value tasks and a greater volume of work.

The report noted: “Humans are working alongside software robots, be they virtual agents or engineers, to increase their abil­ity to take more customer calls, resolve more service desk tickets and process more invoices. This improved productivity is seeing important downstream effects: increasing operational speed and scalability, improving compliance and avoiding future costs.”

In one real-world example, robots were deployed to take over the task of keying broker quote request information that had been previously performed by insurance underwriters. Automating this work freed these underwriters from mundane data entry and enabled them to focus on their real jobs, including “underwriting risk” and producing quotes. In this instance, the underwriters were truly elated as the mundane and meaningless parts of their jobs were eliminated. The result was a faster turn-around of requested policy quotes, capture of a larger market share of bids, and ultimately an increase in binding revenue.

Viewing automation as a way to eliminate both work and people can be a short-sighted strategy. It is far wiser for senior executives to consider RPA as one lever within a broader transformational journey toward becoming a truly digital company. This entails understanding how RPA can support the digital backbone of the enterprise with automation and then understanding the predictive analytics capability – and growth opportunities – that automation can enable.

Understanding the broader digital transformational journey puts RPA and considerations about what will happen with various job roles in a different light. The opportunity for job creation in this space is yet to be fully understood, but it is certain to create new roles and new jobs that are often difficult to envision at the outset of the journey.

Automation is about taking the robot out of the human by eliminating work that is standardized, rules-based and process rich. While roles and jobs are certainly impacted by automation, there are also important benefits for those humans who can adapt themselves to becoming part of the emerging digital enterprise. These include:

  • Freeing up time to focus on higher-value activities;
  • Timely handling of internal and external customer service requirements that robots are unable to perform (the human touch);
  • Leveraging and controlling the work of digital teammates to achieve higher levels of accuracy, service speed and auditability;
  • Creating a digital labor center of excellence with humans who assist automation rather than being assisted by automation;
  • Providing digital analytics that improve insights into the business that were previously unavailable; and
  • Reducing the use of outsourcing and offshoring as a labor arbitrage strategy by bringing work back onshore to be managed by humans interfacing with digital workforces.

To take full advantage of what RPA has to offer, business leaders must begin shifting their thinking to understand how the digital company aligns to the digital economy. They also must think about how they can help employees shift toward the use and management of automation capabilities, freeing up both labor and budgets to be invested in the transformation of the organization to the new operating model.

The automation “polar shift” is more about an operating model change than it is about a technology change. Technology in and of itself is not transformation. True operational transformation – involving people, processes and technology – is required to take full advantage of digital automation. In the end, automation is a business enablement tool that will be supported by intelligent humans doing higher-value work. This is the future of the digital enterprise.

Source: informationweek.com- Rethink How Humans and Machines Will Work Together

What does automation mean for G&A and the back office?

A lot. By incorporating available technologies, redeploying employees and reimagining processes, companies can dramatically increase performance and greatly reduce costs.

The performance of general and administrative (G&A) functions varies dramatically among companies, and the differential is poised to widen. As new forms of automation—fueled by advances in areas such as robotics and artificial intelligence—transform the world of work, G&A functions will be transformed, too.

Some of the impact will show up in costs. We’ve shown before that top-quartile companies operate at nearly half the cost of their bottom-quartile counterparts in the same sector. Those cost differentials will grow with the increasing use of automation.

Just as important, automation brings with it the potential to improve the quality, speed, and flexibility of work dramatically—and this is where some of the most exciting opportunities in G&A reside. Successful G&A-improvement programs, which in our experience can generate twice as much impact from gains in effectiveness as from increased efficiency, not only improve decision making and the allocation of resources but also help employees to work more effectively. As the pace of automation accelerates, the opportunities for improving performance will only increase.

Technical possibilities

McKinsey Global Institute (MGI) research suggests that companies can automate at least 30 percent of the activities in about 60 percent of all occupations by using technologies available today. These findings are consistent with what we’ve seen in the G&A functions of many companies. For example, about 20 percent of the tasks of a typical finance unit’s record-to-report (R2R) process are fully automatable (requiring no human intervention) and nearly 50 percent are mostly so (with technology undertaking most of the work). Similarly, in the HR hire-to-retire (H2R) process, about 30 percent of all tasks can be fully automated and another 30 percent mostly automated.

As the cost of technology falls and its capabilities grow in areas such as robotic process automation, machine learning, and natural-language generation, the economic case for automation is improving rapidly. A major financial institution recently found that it made economic sense to automate nearly 35 percent of finance-function tasks right now. The technology to automate another 35 percent of tasks—though not in a remunerative way—was technically feasible.

Strategic potential

What those automation figures fail to reflect are the possibilities created by reimagining business processes. Assigning machines to handle discrete tasks and plugging new technologies into existing processes may generate savings, but they won’t take advantage of automation’s potential to elevate your G&A function into a more strategic asset. That requires redesigning processes and organizational structures around both current and anticipated automation technologies.

Of course, sustaining G&A improvements has always forced companies to get things done in new ways, to reconfigure roles, and to adapt the workplace culture. But the changes are likely to be bigger for large-scale automation efforts. Consider the experience of a global insurance firm that used a set of automation technologies to redesign an overwhelmingly manual and error-prone process. At any given time, tens of thousands of policies were held up as a result of exceptions, and management faced mounting pressure from regulators to meet mandated deadlines. More than 30 employees were tasked with working the backlog, and it took about five to seven minutes to bring each policy out of limbo.

Robotic process automation provided a way out of this logjam, as high-performing employees were redeployed to more valuable work. The automated process virtually eliminated errors, cut processing time by 50 percent, and reduced costs by even more. The new, automated process also proved highly scalable.

Another major financial institution, already long established as an industry leader in efficiency, embarked on a rapid program to incorporate automation technologies—such as robotic process automation and natural-language generation—into its processes. Taking advantage of existing market-ready innovations, the company launched use-case pilots to validate new opportunities and build out the necessary capabilities. Even more significantly, rather than just considering how to apply innovations to existing steps of traditional workflows, the company realized that it could reap the greatest benefits by redesigning existing processes—grouping automatable tasks, eliminating handoffs, and resequencing approvals to get the most out of automation. That resulted in a wholly novel model, which drove game-changing performance and efficiency improvements. A reimagined regulatory reporting process, for example, made it possible to complete, in as little as an hour, steps that had previously taken a week (exhibit).

 

 

Into the future

Companies understand that getting started is the easy part; a small centralized team, with help from third parties, can build a few bots or algorithms. But scaling is hard. One way to keep the momentum going after demonstrating early success is to support automation efforts across functions and lines of business by establishing centers of excellence (COE). Effective ones create user-friendly playbooks, contribute advanced expertise, build business cases, manage vendor relationships, track the impact of changes, and develop new capabilities. By working with the business to execute organizational change, maintain automation solutions, and manage risks, the most successful of these units also ensure that automation has a real impact.

One of the biggest risks of automation is demotivating or frightening the people your organization must mobilize to compete effectively. Some of the fears are misplaced: humans are needed to build bots and to “teach” artificial-intelligence platforms how to perform their tasks, some of which will always require the active involvement of humans. Critically important social, emotional, and creative capabilities, for example, are difficult to automate. Bots can’t persuade a leader to run a business unit in a different way or design a new human-resources strategy with millennials in mind.

But automation, if implemented effectively, will inevitably lead to changes in organizational structures, to redefined roles—and, sometimes, to redundancies. There’s no point in pretending these realities don’t exist or trying to hide an automation program behind closed doors. Honesty and transparency are critical. So is a commitment from top management to pursue, as part of any automation effort, initiatives that will benefit employees by eliminating routine work they don’t enjoy, creating opportunities for them to acquire new and increasingly important technical skills, and using the proceeds of automation to fund roles that support the business in exciting new ways. Finally, it’s imperative to be open, from the outset, about how you will treat employees who no longer have a role in the organization.

None of this is easy, but the alternative—being caught flat footed as competitors gain an edge through automation—is a risk that’s not worth taking. Automation at its best can help companies to uncover entirely new ways of executing traditional processes and radically new possibilities for operating more quickly, efficiently, and effectively. That makes automation a strategic imperative for G&A functions. The top-quartile companies of tomorrow will be the companies that start the journey today.

Source: McKinsey-What does automation mean for G&A and the back office?