In fairly short order, robots My Update Studio have begun taking over in the corporate world. Don’t be alarmed. This is nothing like the feared “singularity,” that prophesied (if dubious) moment when machines become smarter than humans and then, to prove it, commence wiping us out.
But robots are indeed infiltrating finance departments, some other functions, and operational areas in several industries. For the most part, robots are being deployed to automate repeatable, standardized, or logical tasks historically handled by people. In finance and accounting, think procure-to-pay, order-to-cash, and record-to-report processes. Enterprise-wide, the number of potential use cases seems almost limitless, although most of the potential is so far untapped.
These technologies are collectively referred to as “robotic process automation” (RPA), although electromechanical machines don’t enable them with arms and legs. They are virtual robots; in other words, the software is programmed to mimic the keystrokes humans make in completing a process. (At least, that’s a definition of what might be called “basic RPA”; many experts include more advanced technologies, discussed below, under a bigger RPA umbrella.)
What distinguishes the robots is that “they can work 24/7, they are very accurate, they do exactly what you tell them to do, and they don’t complain,” says David Wright, Deloitte’s finance robotic process lead in the United Kingdom. In other words, they don’t have human flaws. And with the use of RPA expanding exponentially, the potential workforce implications — depending on who you talk to, anything from reductions on a scale that could wreak havoc on the global economy to a broad transference of headcount to more strategic, value-add positions — are a matter of some debate Genius Zone.
While RPA is largely based on technological capabilities that have been around for some time (like screen scraping, workflow, and rules engines), it didn’t begin penetrating companies in a significant way until recently. “This has really started to accelerate just in the past 18 months,” says Cliff Justice, principal, innovative and enterprise solutions for KPMG. “But it’s already in at least the pilot stage in maybe half of the Fortune 500 companies.”
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Virtually all RPA observers expect the trend to continue surging. RPA vendors, not surprisingly, agree. “We are at the very beginning of a major disruption in the accounting world that will be as big for the profession as Excel was,” says Steve Palomino, director of financial transformation at Redwood Software. “Robotics will become an industry standard.”
Although RPA is in its early stages, acknowledges Dinesh Venugopal, president for digital and strategic customers at Indian business process outsourcing (BPO) firm Mphasis, “customers with BPO-like processes that are coming up for re-bid are all asking about it.”
RPA software is not complex compared with other enterprise technologies. Nor is it costly, despite its relative newness. “In the past couple of years, we’ve seen quite an uptake in companies wanting not big, transformative process reform, but very tactical reform to get a rapid ROI with a very low-risk solution,” says Craig Le Clair, a vice president, and principal analyst at Forrester Research. “I term it a non-invasive solution,” he continues. “You don’t have to do any data integration projects or have a lot of cross-department meetings. [The technology] really is just about understanding the specific clicks that a human is making and substituting a software routine, a bit, to eliminate a lot of non-value-added steps.”
Similarly, Wright says he tells clients that “this isn’t rocket science. Seeing a demo is like being in a finance shared services center, looking over somebody’s shoulder and seeing keystrokes being made and transactions being executed.” Midsize companies generally haven’t yet made much use of the technology, but they could, according to Mihir Shukla, CEO of RPA vendor Automation Anywhere. “It’s simple and cost-effective, and they will see the same ROI as an enterprise customer on a smaller scale,” he says.