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Robotic Automation – What impact could it have on the BPO market?

Manufacturing a long time ago turned to robots to reduce costs , increase production speeds, improve consistency and quality, increase flexibility on the factory floor, reduce repetitive tasks  for workers, enhance competitiveness  and try and make “things” just better and faster!  Today many factories operate for long periods of time without human intervention, however people have not disappeared entirely, the “lights out” vision of manufacturing has not arrived at least yet.

So what’s happened outside manufacturing? The equivalent environment in the world of administration where tasks are performed routinely and paper is endless pushed around by staff  with sometimes a little help from smart systems supplemented by email has started to see some robotic action.

The first response from administrative heavy organisations was to consider, and some cases push the outsourcing of administrative tasks to cheaper geographies where staff cost less and are available 24 x 7 x 365.  Manufacturing also took this course in their efforts to produce their wares cheaper and improve quality but times are changing and there are signs that some production is being repatriated  In a similar vein organisations are starting to look for new ways of reducing costs whilst improving their processes through bringing software robots to bear.

Who cares?

Well business is getting tougher. Customers are getting more demanding.  It’s getting harder to differentiate and costs need to be kept under control whilst processes that ultimately “delight” the customer are been shored up and improvements sought.

Many large administrative heavy customer facing organisations are pondering what’s next after outsourcing, whilst some are actively finding ways to automate particularly the “long-tail of administration” where previously it had either been uneconomic or IT resources have not been available.

Reducing costs, increasing agility and competitiveness, generating greater returns and so forth are of interest to shareholders and business leaders alike.

IT rules OK!

IT and all that it delivers plays a pivotal role in business, without it the chances of success are nil. However it is also an expensive, complex and resource draining activity that many companies find challenging to harness. The business world and the IT world despite the many bridges that have been built remain separate islands where communication remains difficult and the translation of a business need into a confirmed IT success continues to remains a much sought after goal.

Often IT resource is fully focused on the big picture, supporting the grand strategy whilst maintaining significant legacy systems. This leaves little for the less obvious, less glamorous but potentially fertile ground of taking the “manual” out of swathe of administrative tasks that many organisations are compelled to work in order to maintain control and ultimately deliver customer satisfaction.

“To maintain our competitive advantage we need to be able to respond rapidly to changes in the market, support our marketing efforts and minimise operational cost whilst ensuring that we maximise customer satisfaction. We have an on-going objective of automating processes where we can,” observed the Head of Credit and Insurance Operations, Shop Direct

Who wants admin robots?

There are many examples of organisations that have an on-going goal to make their back office and customer facing functions more efficient and effective. This can be achieved through automating processes to reduce cost, increase timeliness and enhance the simplicity of its operations whilst ensuring that customer service is not impacted and where possible improved.

Challenges for teams managing administrative processes that support the business include improving the overall agility of the business to respond to a constant and ever increasing stream of changes in business which are both internally and externally generated.  A key objective is to increase the simplicity of administrative processes whilst removing processes which add no value and most importantly identify a fast and cost effective way to automate processes.

In the highly process driven world of the insurance and financial service providers, many organisations are committed to the continual improvement of all their processes. However they can be thwarted in achieving their goal because of limited capacity within their internal IT function because of their need to focus large and critical strategic programme

“Our total change requirements could only partially be catered for by IT who were at capacity through focusing on the larger and critical strategic programmes. What we needed was a solution that would enable the operational change team to increase their own capacity and address the next level of process automations within the ‘long tail of change,” commented the Head of Operational Architecture of a financial services organisation.

The IT function are not business process experts.  What’s required is a solution that the administrators themselves can use to automate the processes they work with every day and fully understand their role and nature. Let them build the “robots”.

The office robots are at the office door

 So finding a cost effective solution that will not put the IT function under further strain, will comply with IT governance and can be implemented by the process owners themselves to build a virtual back office is the order of the day.

This virtual back office could be comprised of a virtual workforce of robotic FTE’s who would automate repetitive rules based procedures supporting the process owners who manage exceptions and drive continual process improvement.  Research has indicated that robotic FTE’s can be up to a third of the cost of an average offshore FTE.

They can run 24/7 without making mistakes, can respond rapidly to peaks and troughs in demand and be rapidly re-configured to deal with new process demands driven by new market opportunities, regulatory demands and business dynamics.

This is possible and organisations are starting to create virtual back offices increasing accuracy and service levels without additional costs.  There are now solutions available that can automate potentially 100’s of back office business processes by creating “virtual” FTE’s which can perform repetitive and rule based tasks, interacting with any existing application.

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