Companies in all industries and all locations are increasingly looking to technology to improve their operations, streamline processes, and save time. While many separate innovations are merging together in this wider push for digital transformation, the benefits of automation and the virtual worker are being embraced more and more.
It’s easy to see why. Any medium-sized company that has been around for even a decade likely has a complex makeup of systems and methodologies layered on top of one another. The setup generally works. But it isn’t exactly how an operational architect would suggest crafting things from the ground up. And these days, companies are coming to understand that functional is a far cry from optimal.
One company that is working to help enterprises become more efficient is Auxis, a management consulting and outsourcing firm that categorizes its mission as helping clients “achieve peak performance” in back office operations.
Raul Vega, founder and CEO of Auxis, ran a Latin America-focused shared services division for PepsiCo in the 1990s and has long been advising a blended model of shared services and outsourcing for his clients, including his former employer Pepsi, DHL, and others both big and small.
In recent years, automation — specifically “robotic process automation” (RPA) — has been growing into a key component of the Fort Lauderdale, Florida-based firm’s strategy, Vega told Finance TnT in an interview. “The whole business world is going through a lot of change and turmoil, and traditional business models are being challenged,” said Vega. “Companies need to adapt.”
Use Cases for Robotic Process Automation
The retail industry is one of many sectors currently being up-ended. The process started two decades ago with the rise of e-commerce before being sped along by the maturity of Amazon and other online rivals. Now the ongoing disruption of digital payments and on-demand delivery is changing the game even more quickly.
While Auxis, which specializes in delivering solutions to optimize finance and accounting, IT, and customer service functions, cannot roll back history for these companies, it can offer solutions that allow them to stop dumping valuable resources into non-essential areas.
“We don’t really help address that sales and marketing issue,” said Vega. “We help them on the operational side to really revamp their business to a more modern model that is more agile and more efficient.”
For Vega, that is the main selling point for robotic process automation: All companies need to focus on their strategic, core business issues while back-office processes are made as painless as possible. These lesser functions must be done — and they must be done right — but they shouldn’t be sopping up more resources than absolutely necessary.
The no-brainer cases for RPA comes down to finding “task-based, repetitive, rules-based processes that typically involve multiple systems,” said Vega.
A lot of interest is coming from the financial sector — and for good reason. Nowhere are there more layers of systems and databases that can benefit from speaking to one another more easily and with fewer duct-tape solutions.
Some of the top applications include order processing, invoice processing, and human resources tasks like benefits administration. “Believe it or not, we have some large, large global clients that still get invoices from clients where they have to go into their website, download the invoice, enter it into a system, route it for approval,” he said. “Now you do that with robots.” In this area, Vega says automation can make the process 70% to 80% more efficient.
Automation can also offer a good compromise after a merger, specifically in terms of trying to blend together multiple ERP systems. A full overhaul to combine everything into one system can be an expensive, time-consuming endeavor, problems that are magnified by the fact that the newly combined company often wants to hit the ground running to quickly unveil some splashy new projects and show off the value of the deal. But the rub is that continuing to use both systems at the same time can be highly inefficient.
RPA offers the ability to simply embed some relatively easy-to-implement software and have a digital worker do all the legwork of going back and forth between systems that would take a human much more time — and bore them to death. “For a lot of workers, their job is going to get a lot more interesting because you’re getting rid of this mundane processing,” said Vega.
This is what shared services in the finance space has been doing for years. In Vega’s experience, from two-thirds to 80% of the workers in these centers are dedicated to processing. Now, the robots can do all that under human oversight. “Then what you do is have these processors elevate themselves to more of an analyst role,” said Vega. “The way I see it is that they are now working with the robots as part of a team.”
The Technical Basics of Robotics Process Automation
Auxis has carved out its niche as a player in the business processing outsourcing and shared services world. Vega recently broke down some of the key benefits of this strategy, particularly in terms of using providers from the Caribbean and other “nearshore” locations in the Americas, in a webinar hosted by the Trinidad and Tobago International Financial Centre (T&T IFC) and Nearshore Americas.
He believes that this blend continues to be the optimal services and back-office strategy, but he says that this now goes hand and hand with automation. The change has been swift but it is most certainly well underway. “RPA is old technology but it really hadn’t been used,” he said. “And now it’s coming to the forefront and it’s embedded really in all the conversations we’re having with our clients, which I would say 18 months ago that wasn’t the case.”
Some companies are still a bit put off, either by the fact that automation can lead to layoffs or simply the technological aspect of it all. “People hear RPA — because of the ‘robotics’ term that has been attached to it — and they think it’s kind of like some Star Wars, way-out-there thing,” said Vega. “But at the end of the day it’s not. It’s relatively basic technology — but it’s very impactful technology.”
The best way to explain RPA is that it is simply a virtual employee. It requires a user login name to access the system and, in many cases, actually works on a virtual machine just as a human worker would, clicking on buttons and accessing different programs.
It can go into Excel and copy info from a spreadsheet cell into the larger management system, whether that is in terms of processing an invoice or ticking off boxes on a compliance checklist. It can schedule alerts that notify team members when a certain number of invoices have been processes. It can answer email.
With the right programming, usually based on relatively simple rules- and exceptions-based coding, the “robot” software can do most any low-level task a person can do. And best of all it can work 24/7 in the background, getting things done faster than any person without ever needing to sleep or even a bathroom break.
Even though RPA does sound less confusing once it is explained, Vega, alongside the Auxis partners that actually specialize in building RPA software, tries to first focus on explaining the benefits rather than getting bogged down in the tech. Again, he highlights that companies need to stop dumping time and resources into payroll and accounting and instead free up personnel to focus on real work that can lead to growth.
“Typically, it’s not in the back office,” he said. “The back office has to be done well and efficiently, but it’s not really going to make a difference.” Instead, he wants to sic the robots on the grunt work and let companies do the important stuff they are neglecting for lack of time, like strategic analysis, pricing analysis, customer insight, and business intelligence. “There is stuff that they need to be doing that they’re not doing,” said Vega.
Implementing Robotic Process Automation
For many companies, getting started is the hardest part. The barrier to entry, while not high, can be daunting due to all the jargon and sales pitches coming from industry vendors.
That’s why the integration process really needs to begin with education. This starts with information and conceptual explanations, naturally, and requires a conversation to assess what processes the company thinks can be automated.
This conversation is helpful in the sense that it reveals the low-hanging fruit, but it also provides a window into how ready the company is to embrace robotic process automation. Are they looking to just dip a toe in to the RPA pool or have they already made the organizational decision that this is something they want to start moving on quickly and broadly?
Either way, the next step revolves around systems monitoring and documentation, which can last for a few weeks. This is actually relatively simple: Software is installed onto the machines of actual back-office workers and it documents everything they are doing. The processes and their inefficiencies become understood.
Typically, the tech experts and implementation partners that Auxis relies on have seen similar processes and results before. So they generally can anticipate problem areas that will need to be smoothed out. But the documentation phase is crucial, as it generates enough data to understand if things can be further optimized or if anything is being missed. All companies are unique, after all, and “The Way We Do Things Around Here” can be quite odd at some places.
Then the software is configured to the specific company and processes. This can take a few weeks depending upon the complexity of the tasks at hand and how unique the operations are. This is then tested to fix any bugs and write the code correctly to ensure it is operating as expected.
Next is the parallel testing, which serves as the proof of concept. This is the time when you have human workers doing the process at the same time that they robots are doing it. They just both work at the rate they can for anywhere from six to 12 weeks. And, usually, presuming all the programming was done correctly, this is where the efficiency benefits become undeniable. “That really opens peoples eye,” said Vega. “It’s one thing to conceptually talk about it, but when they actually see it working, then the really see the applicability.”
This leads to roll out. Companies build the road map of how they are going to integrate this into their business. They define which processes are ripe for automation and then slowly go through the same steps in each area: assessment, documentation, configuration, parallel-testing, implementation.
Really, that’s all there is to it. They then just rinse and repeat in as many areas as the company is comfortable with. The scope and depth of the implementation is ultimately up to the organization. “How fast you want to go is just a matter of the company culture and the ability to absorb change,” said Vega.