Unlike the large analyst houses where analysts can be swapped in and out like cogs in a machine, HFS has been built on people, their expertise and their personalities. This is a company where people can shine as individuals and aren’t simply turning corporate widgets to grow revenues and meet targets.
With the 10 year anniversary of HFS coming up, I keep getting asked: “what does it take to build a successful brand and company”. Well, the first thing I will tell you is I never set out to build a company this size, it just happened as our reputation grew and more quality people wanted to join our firm. The second thing is that this is all about the people you bring in, as they are part of your brand (and your brand becomes their brand too). You won’t always get it right, but as you get more experienced you will learn from your mistakes and “trust your gut” a lot more… so here are some learnings I wanted to share with everybody. And am pretty sure this applies to any business where people are core to your success.
13 lessons learned when building a firm:
Get past your ego. Decide why you want to run a business. Do you really want the stress and responsibility, the 20 hours days and no real vacation for many years, or do you just crave power? If it’s the latter you will likely blow up and fold…
Have faith in yourself. I’ll never forget when my (then) prime competitor declared “I give Phil 18 months and he’ll be gone”. 10 years later, and we don’t even consider that firm competition anymore. People will snicker and laugh that you think you can build a business, but remember they are just jealous they never had the cojones to do it themselves.
Have faith in people who share your vision. When you start out, there’ll be some good friends / former colleagues who will consider throwing their lot in with you… but you’ll likely have to pay them. But people who believe in you are irreplaceable, especially when you are small and building up the brand. But you have to bring in people to help you, otherwise, it’s a very lonely experience when it’s just you and a few stringers…
Don’t dwell on those who do not…. There will always be people who don’t respect you, but they may be desperate and hit you up for a job. Shy away as they are only out for themselves and will bail on you’re the minute another gig comes along. They need to believe in you, not just their bank balance.
Invest in talent to support your people. As you grow you can’t rely on your loyal warriors to hold the fort forever… they’ll eventually burn out and reluctantly go somewhere else for more money and less hours. So make sure you are constantly evaluating and hiring good junior folks to support them, with a defined career path. You must have a support system for your key breadwinners or you will fail and end up with a broken firm to hold together.
Don’t be afraid to make mistakes. The best part of being the boss is being able to f*ck up – and there is no one to blame bar yourself… and you can’t get fired for it either =) Just make sure you always make a point of learning from your mistakes.
Trust your gut and never regret the odd screw-up. If you can’t trust your gut, then give up now. Your instincts are your life-blood and are those things which will make or break you. If you sense you need to invest in a certain area, or take a punt on a person you think may be awesome, then just trust your gut. When evaluating my decisions on business and people, I think I have about a 70% success rate… we have some brilliant people at HFS whom I know I took a “gut feel on” and we also made some wild decisions – and some turned out great. There have also been some decisions that bombed too… but never regret them. You can’t be right all the time…
Don’t push people to try things that aren’t their core strength. I learned this the hard way, but don’t ask people to do things they are lousy at, or uncomfortable trying out. There is nothing more valuable that your loyal “swiss army knife” colleagues who can wear several hats, but these people are few-and-far-between. Asking people to do things they are bad at will always spectacularly fail.
Don’t hire people with a “big company” mentality. Some people are so used to hiding away from doing actual hard work, flying first class and playing “upward management” politics. Avoid. Avoid. Avoid… they will never adapt to a small company “roll your sleeves up” attitude.
Avoid job hoppers. Running a small growing firm will expose you to the perennial job hopper who will see you as their next escape route form their current misery. Trust me, job hoppers are miserable people who are trying to find some sort of “happiness” when they take on a new job. And they are amazing at feeding you kilos of succulent bullshit at interview. However, as you watch their careers, their honeymoon periods get shorter and the hops get faster… They like the buzz of the new gig, the ego-stroking, the whole romance of “being recruited”, but as soon as it’s time to roll their sleeves up and do some serious work, they fold and start looking around again… and they will bail as soon as their next loving employer gets starry eyed at their wonderful interview technique. I would add that you can give someone a job-hopping pass in their 20s, but those folks who still try this in their 40s and 50s are far too gone to ever succeed. Sadly, there are a lot of primadonnas out there who will always consider themselves too wonderful for any work environment…
Eliminate toxic people… fast. This is imperative, but you will always hire the odd toxic personality, and it can take a while to figure them out. Some people will always play both sides, can make outrageous lies… will try almost anything to get what they want. And the more they fail to get what they want, the more toxic they become. Sadly, these people exist and we have all come across them. All I can say is get them out as fast as you can as they will harm your business more than anything else.
Don’t fail fast… learn fast! To quote the great Jamie Snowdon, “Failing is vital to any business, but simply failing and moving on to the next idea? Throwing your business thoughts against the wall and seeing what sticks, like some perverse infinite monkey approach, is not smart. Failing and limiting the damage from a dead-end pursuit is a good idea, but the real value of failure is what you learn, and how your subsequently apply that learning experience to your business. This is what provides the value.”
Try not to take things personally. This is one of the hardest things to master, and I am still working on this. End of the day, this is business and people will ultimately look out for themselves. Clients are only loyal to a certain extent as are your staff… don’t get too excited when things are great and too miserable when bad things happen… try and stay measured and pragmatic as much as is humanly possible. Otherwise you’ll burn out or drive yourself crazy.
Bottom Line: Be honest with your people and always look yourself in the mirror
Never get carried away with your own success… it’s really just a combination of good judgement, good business senses, good relationships and a lot of luck. Celebrate your success where you can, but never get too carried away… remember, you’re just a mere mortal like everyone else who somehow became an entrepreneur. As a business leader, the more you keep your feet on the ground, the more success you will likely experience.
A cross-section of founding customers, analysts, and advisors assembled in London on November 13th 2019 to debate the key areas the RPA industry must address
Exactly seven years ago, HFS launched the concept of robotic process automation (RPA) to the world via a seminal report and blog. We described a Blue Prism technology offering that “appears best suited for processes that are highly rules-driven and the requirement for which is too tactical or short-lived to justify development by IT organizations that favor service-oriented architecture (SOA) and tools like business process management (BPM) suites.” This was the first time a low-code tool gave business professionals a means to bypass traditional IT protocols to fix and digitize tasks—and potentially entire process chains.
The ugly truth surrounding the first seven years of RPA adoption is that we’ve simply succeeded in using RPA to move data around enterprises faster with less manual intervention rather than to rewire our business processes and create new thresholds of value.
The industry is in desperate need of a renewed vision for RPA—a manifesto for the next seven years focused on long-term value, not short-term land grabs, if we are to realize the potential of a truly digital workforce.
HFS, supported by Blue Prism, assembled a cross-section of founding customers, analysts, and advisors (see above) to refresh and reinvigorate where the RPA value proposition is heading at a critical time when investors are getting nervous with high-profile startups struggling to meet demand. Simultaneously, the systems integrators, BPO providers, and consultants—critical to driving this market—are noticeably losing their voice. In short, the industry known as RPA runs the risk of fading into enterprise insignificance if we cannot communicate its value to the world, set the right expectations, and re-ignite excitement surrounding the long-term value it delivers.
RPA’s success and longevity over the next seven years hinge on it becoming part of the enterprise digital transformation agenda and emerging digital architecture. Without a digital workforce, many enterprises will fail to support the digital needs of their customers, employees, and suppliers, and RPA’s capabilities to support these fundamental process transformations are of utmost importance.
What follows is the result of extensive thinktank brainstorming on what needs to be true to enable the success of RPA. Here are the new rules:
HFS’ Ten Laws of Robotic Process Automation
1. IT and business must work together and share the responsibility to digitize processes, or digital business models will likely fail.
In short, this is the first time many operations executives have dabbled in low-code solutions to improve process flows, and IT is a critical partner to make it work long-term. The two factions cannot succeed without each other. They must agree on the roadmap and operating model for the future because the business must design process flows that support the core business outcomes that IT can enable and deliver. Businesses often love RPA, but IT often misunderstands it because RPA doesn’t fit IT’s logic. Business units must remember that IT has responsibilities far beyond business processes, including security and resilience. Furthermore, IT often bears the brunt of troubleshooting automation gone awry and maintenance, too, whether it was involved from the outset or not. RPA often starts in shadow IT, purchased by the business through an unsanctioned side door. But it’s difficult to get to scale from the shadows. The age-old corporate holy war between IT and business must find its peace if the next-generation digital architecture and workforce of the future is to be achieved.
2. Mutual respect between IT and business massively improves your chances of success.
If one side is not ready for change, then there will never be the required balance to succeed. This maturity is essential to match risk and determine eligible processes. IT must ideally be open enough to accept that their business ops colleagues could work differently, and their forays into RPA are helping change their mindsets. The business needs to respect and embrace IT’s process, risk, and governance capabilities. Anything less relies on luck and hope, and that is not a strategy.
3. Automation and strategy must be led by an overarching business strategy.
If automation is not part of the overall business strategy, senior leadership will not focus on delivering automation projects because of their risk of failure—or at least mediocrity. Most businesses can only deliver against three or four strategic initiatives at a time, so they should stop any automation projects that are not directly contributing to one of them. Automation’s focus always needs to be on the desired measurable business outcomes of these high-level initiatives; otherwise, they become too tactical and will lack management commitment. The short-term targets and KPIs need to have a clear and logical relationship to the bigger picture.
4. Treat RPA as an enterprise application.
If you view RPA as a widget or productivity utility, then it has no chance of supporting broader digital change. Part of business and IT alignment is recognizing RPA as part of the canon of digital change agents that are helping advance how companies are run. No tool alone can ever do the job, but the exponential power of “and” is compelling.
5. Establish meaningful and measurable KPIs.
HFS and the event’s brain trust vehemently oppose the use of numbers of bots as a measure of value or success, and we advise against it as an incentivization metric. Look to what the bots can achieve and the impact they deliver—not how many you have; there is no consistency in bot definitions and functionality, so that number is meaningless. Better measures of value include how many hours bots saved and what they accomplished and alignment with core strategic business metrics like contribution to operational efficiency and employee retention. Ultimately, many enterprises will measure successful initiatives with numbers of FTEs freed-up (or eliminated), but it can take years for soft-savings to become hard-savings as enterprises learn how to best apply the technology.
6. Treat RPA as a gateway to embrace process mining, process discovery, machine learning, data ingestion and advanced analytics to achieve real artificial intelligence for enterprises.
For most business process executives, RPA provides the first toolset on the road to full artificial intelligence (AI) adoption. In short, this is the first time many business process experts have learned to use low-code solutions to remove manual workarounds and correct workflows, and the benefits are naturally driving them to explore advanced process mining and discovery applications, advanced data ingestion and analytics tools, and also learn how to manage machine learning initiatives that pave the way to the ultimate goal of full AI and end-to-end process automation. Moreover, learning to change the logic of processes to delivery business outcomes is driving ambitious executives to look at the world and the desired experience from the user perspective. Users can be customers, employees, partners—anyone. Manual work is not the enemy; poor user experience is. Improve or reinvent processes before you automate them. You must have an opinion on whether a process is good or bad before you automate it. Failing to evaluate processes is arguably RPA’s most glaring missed opportunity. Cultivate these capabilities through Lean Six Sigma programs, process mining and discovery tools, or other means. Then, track the pipeline opportunities. For automated processes, use the baseline to help measure and determine whether you made the right automation choices. There is nothing wrong with trialing RPA with legacy processes to fix manual workarounds, keep older systems functioning, and learn how the technology works, but, ultimately, maintaining legacy will never reap long-term benefits. Go broader than cost and piecemeal process automation. Work toward a desired “to be” state, don’t just automate parts of sub-optimal processes. RPA will never be part of the broader digital agenda if it’s just a band-aid.
7. Automation must orchestrate end-to-end processes across both front and back offices.
New research clearly shows that most automation dollars have been plowed into the back office of companies, notably to improve finance and IT processes. Ambitious enterprises must align investments in automation, AI, and other digital technologies with driving the customer experience, improving the top line, and aligning business operations with customer-driven outcomes. Exhibit 5 details how the ‘’OneOffice” experience is dependent on process flows spanning the customer at the front end of the organization with the supporting operations at the back. Being able to stay ahead of competitors relies on anticipating customer needs, often before the customer even knows them, and RPA can provide capabilities to stitch together applications, activities, systems, documents, screen-scrapes, and other touchpoints. Naturally, this entails the enterprise leadership to break down silos between business functions to design end-to-end processes and craft full-scale automation solutions (Exhibit 5).
How RPA can orchestrate end-to-end processes that deliver the OneOffice experience
8. Bring new talent and perspective into the automation market.
We are generally unaware of our own biases. Despite the rallying cry to drive change, loads of business operation and IT leaders looking for ways to do the same things faster and cheaper are powering the automation market. We must raise awareness and cultivate new talent through schools and universities, reskill workers of all ages and skills, and generally strive to bring new experiences and talent into the conversation. Diversity and new perspectives are proven to drive change and thwart the status quo.
9. Don’t forget hearts and minds.
RPA facilitates the creation of a digital-enabled workforce that concentrates and enhances the human skills and capabilities of the analog-based workforce. RPA does this by taking repetitive tasks offline, which results in more fulfilling work, or by creating substantially enhanced real-time access to data or computational skills, both of which increase productivity and quality of outcomes. It augments humans, which may eventually result in requiring fewer people, but it also provides the opportunity for growth and better customer and employee experiences. Unless we continue to educate humans about the power and potential of RPA and automation, no amount of IT and business alignment or well-intentioned strategies can make it work. Invest in ongoing education about the value and benefits of automation, and use simple language.
10. Consider dropping the word “robotic” from RPA.
There is no doubt that the term “robot” was the catalyst to driving unprecedented interest in RPA since its 2012 inception. However, most RPA engagements today are largely attended desktop processes that constitute barely more than five robots, as opposed to the unattended engagements that were the true initial intention when the solution was invented. So, why persist in using a word that is deeply associated with job elimination, has confused many, and has added little but confusion and ignorance into the market? Related areas, such as process mining, machine learning, and data ingestion, do not need the term “robotic,” so why use it when we are really talking about automating processes and tasks?
The Bottom Line: RPA is dead unless business leaders align it with their broader digital transformation agenda.
Today’s business leaders are inarguably those that prioritize speed-to-market and top-line impact through sales. The laggards continue to focus on cost reduction and efficiencies. Appropriate use of RPA and automation capabilities is no different. RPA must support enterprises’ digital transformation agendas.
Enterprises and the RPA ecosystem must make RPA part of something bigger—part of transformation, strategic initiatives, and broader goals for user experience. Stakeholders must align RPA to other digital enablers: complementary change agent brethren such as process mining, low-code BPM, elements of AI and smart analytics, APIs, and microservices.
The RPA we’ve known for seven years is dead. The fate of RPA for the next seven years is contingent on collaboratively supporting something bigger.
There haven’t been too many better debates since RPA fever took over the world of process executives whether the toolset was the first step on the road to full artificial intelligence (AI) adoption. The consensus has largely been that RPA provides some great process orchestration experimentation that can eventually help us enjoy that ultimate AI high. However, the only way to truly get on that Intelligent Automation Continuum is to redesign processes that drive specific business outcomes, where RPA is an enabler to achieving the desired process flows. If you’re just using RPA to make a crappy old process run better, you’ll struggle to achieve much more than a mild buzz:
However, what really brings home the emerging ambition of enterprise operations leaders is the new data from the State of Operations study that shows AI leaping ahead of RPA as the most significant area of focus for investment in 2020. This clearly means that achieving AI effectiveness is clearly the larger enterprise-wide goal, and experimentation with process automation is encouraging many executives to think about broader business outcomes as the potential of machine learning and other AI facets become more and more intertwined with process digitization:
The Bottom-line: Automation and AI strategy must be led by overarching business strategy, and RPA often provides the first testing ground
If automation is not part of the overall business strategy then senior leadership should not be focused on delivering automation projects as they run the risk of failure or at least mediocrity. Most businesses can really only deliver against 3 or 4 strategic initiatives at a time, so if automation projects are not directly contributing to one of them they should be stopped. The focus of automation always needs to be on desired measurable business outcomes of these bigger initiatives, otherwise, they become too tactical and will lack management commitment. The short-term targets and KPIs need to have a clear and logical relationship to the bigger picture.
In addition, RPA must be treated as an enterprise application. If RPA is viewed as a widget or productivity utility, then it has no chance of supporting broader digital change. Part of business and IT alignment is recognizing RPA as part of the canon of digital change agents that are helping advance how companies are run. No tool alone can ever do the job. But the exponential power of “and” is compelling.
After the recent RPA circus acts, the process automation industry has reached its lowest ebb. Simply put, dollars were being put behind a value proposition that simply wasn’t realistic – but that doesn’t mean the market doesn’t have amazing potential. We just need to refocus (and fast) on a direction that is real and sustainable for the long-term and rally everyone behind it. And the fault lies as much with the enterprises buying the solutions as it does those selling and implementing them.
Far too many enterprises are paying lip service to CX – they love to ”big it up” but aren’t putting their money where their mouths are
We can bemoan over-eager investors and over-hyping marketeers all day long for over-cooking the market, but the reality behind the sluggish uptake of scaled deployments is the simple fact that intelligent automation initiatives and investments are firmly rooted in the back office, according to 590 major global enterprises, where nine times as much investment has gone into the back office versus the front:
So why is such paltry investment being made in the front office, when improving the customer experience and making front office function more efficiently are the biggest drivers? Is the CMO/CDO completely distrusted to spend on technology-enabled initiatives? Is automation simply an activity not worthy of the CMO’s attention and the CFO has to be the one to get his/her hands dirty? Because when you talk to digital leaders on both the buy and sell-side of the equation, they will all confess that both the potential and capability of RPA to fix the gargantuan mess that is marketing and customer service process is massive. Yes indeed people, improving customer experience is the ultimate objective of the majority of enterprises’ intelligent automation strategies. Because you can’t get the full benefit from customer analytics and AI if your processes are glued together by spaghetti code and manual workarounds:
Adoption of intelligent automation solutions is painfully slow because enterprises are failing to define their ideal “to-be” states
When you consider it took a decade just for the finance function to grapple with the seismic shift from Lotus 1-2-3 to Excel, why are we expecting the same people to embrace much more complex technology tools like RPA and Watson as voraciously as ice cream ion a hot summer’s day? Sure, the levels of investment in intelligent automation have already surpassed an average of $50m for the function, but the pace of adoption is still desperately slow, with barely a third of enterprises moving beyond pilots for any Intelligent Automation technology:
The Bottom-line: The process automation industry needs to rebuild the trust of enterprise leaders and investors. That means we need to approach this from an enterprise-wide perspective and quit paying lip-service to the customer experience
The only way to focus on successful automation is for clients to define their ideal “to be” state and then work on solutions to help them get there. For many enterprises, this may be to drive down cost / improve efficiency, but the majority are focused on improving customer interactions and customer delivery execution (see above).
What software vendors need to do: Quit all the marketing fluff and focus your solutions on supporting clients reaching their desired “to-be” states. Just trying to sell licenses as aggressively as possible has only resulted in mass disappointment – and has hurt the market and lost a lot of customer trust. Who cares which brand came higher in the latest analyst report (written by some analyst who has never written a script in his life) or whether Microsoft actually has any clue what it’s doing, making a play into this space with some dated technology? Instead, focus on engaging customers to solve their desires – which are clearly outlined above. This means making sure you have evangelists who can educate clients (not just amplify the same old cardboard marketing fluff from some turgid conference) and invest in a support division which can build a world-class partner ecosystem and support clients directly during their early phases to get this all on the right track. Sure the tech is important, but if it’s not purchased with the right mindset it’s all one big fat waste of time and money – and costs many their careers into the bargain.
What enterprises need to do: Design and define your “to-be state” and use that to flesh out which partners can actually listen, understand and deliver. The first thing you need to do is get past all this “bot for every employee” nonsense and focus on what you need, not how many licenses to buy to keep your local RPA sales rep happy. Most of these products can deliver basic RPA, document processing, screen scraping etc (and you can get deeper into which one performs best to meet your need in time), but you really need to get familiar with the whole concept and potential of intelligent automation technologies before throwing wads of cash at new kit. I’ve already seen several people lose their jobs because they squandered fortunes on licenses they didn’t need and were left carrying the can for a dog’s breakfast of an automation program… Then you need to explore all your critical process flows across the front-to-back offices. While your operations folks in the non-customer facing areas will undoubtedly be more enthusiastic about develop competencies in intelligent automation, getting the frost office executives on board will reap considerable benefits down the road, Marketing workflows are awash with manual workarounds, legacy apps and silos of data… customer services are a real mixed back of good and bad process habit and don’t even get me started on sales. So think OneOffice… think about how the real customer-centric organization needs to operate and you can work backward from there.
What service providers and consultants need to do: get your heads out of the back office and reel in the marketing/sales leads. Simply put, you need to be the vehicle to help your enterprise clients align effectively with what the software vendors are selling. If you are not that vehicle then get out now, as you will be dead in the water. While the CFO and COO (and often the CIO) have budget to spend on software-driven process initiatives, they are often too rooted in stove-piped projects which operate at a snail’s pace with little enterprise impact. You need to drive the intelligent automation discussion with the Chief Digital Officer / CMO to understand, listen and demonstrate the huge impact that these technologies can have in enabling a well-designed customer process and integrating with the operational areas of the firm to support unified data efforts. You have to help join the front and back-office pieces together for your clients if they are ever going to get past task optimization to genuine end-to-end process automation.
Let’s make no bones about it, this has been one sorry saga. All we could do was warn the industry that cheesy marketeers, some lousy paid-for analysts and poorly-informed investors were forming a vicious web of bullshit that would take a solution with real potential and fake a market that bore no reflection of the one we originally dreamed up seven years ago.
And don’t say we didn’t warn anyone over the past year that the RPA market was in grave danger of being hyped out of existence:
So how can UiPath recover from this capitulation, a week after drawing the entire attention of the industry with its $8 million extravaganza in Las Vegas? The trust is wafer-thin (or pretty much evaporated), people are worried, and some fired employees are sharing their agony and disappointment freely.
10 ways UiPath’s leadership can recover the trust of an industry that trusted them
1. Treat the market you help build with more respect. Customers, prospects, partners, and the 500+ employees (or whatever number ultimately turns out to be real) you just sacked who believe(d?) in the vision and the brand. Read from some of the employees who have risked their careers and families’ livelihoods, just to see it all blown away in a few months.
2. Ask for help. Scaling a company and a scaling a relatively new software category are distinct challenges, made harder by them existing within the same company. Don’t imperil a fledgling industry with your lack of experience in the former while you trailblaze the latter.
3. Be honest. We should not have to say this.
4. Stop taking schoolyard potshots at competition. Competition gives your brand context and creates a healthy market.
5. Stop counting customers. We will repeat this forever. Start showcasing scale of customers. We are all still learning.
6. Charge for what’s valuable. Giving your product away or undercharging for it to create stickiness (while touting obnoxious customer numbers) is a road to nowhere. No one values free.
7. Apologize. Daniel’s belated, smug response is insulting to anyone who’s done business or is considering doing business with UiPath. Relationships are based on openness. That Daniel letter looks like an attorney wrote it.
8. Stup f-ing up the company and execute on the product roadmap because it’s good. Elena’s in progress POV after ForwardIII complimented the focus on enabling customers to do more with RPA – enabling functions like process identification and pipeline management, business benefit analytics, and more meat on the AI backbone.
9. Quit the arrogance. Releasing a Forrester Wave as the news of its layoffs broke, simply to drown out its layoff noise, where the analyst is clearly biased towards the firm (which also employs his son) just served to anger people who are craving some humility and less bragging.
10. Quit the “robotic butler nonsense”. Let’s define what we mean by RPA scale versus counting number of bots. “A bot for every employee” simply means “buy loads of our licenses”.
The Bottom-Line: It’s a marathon, not a sprint
Let’s build the white muscle capability to run the marathon versus red muscle capability to run the 100m dash. A few key takeaways for all of us from this:
RPA vendors: Not all of you are completely innocent of the same behaviors that have led to UiPath’s troubles. Be relieved this didn’t happen to you, and make sure it still doesn’t. Focus on value, not potshots and hype.
Service providers and advisors: Really be careful how you approach RPA alliances, as your choice of partner also reflects on you.
Analyst firm leaders: If your analysts don’t understand this space, then please stop bringing down the analyst industry with clearly flawed research and analysis. I’ve never seen analyst credibility reaching these depths before.
RPA users: Use this as a segway to evaluate a multi-product integrated product strategy and do not throw all your eggs in one basket. There are several excellent RPA, data ingestion, process mining and ML tools out there you need to embrace and integrate into your roadmap.
We’ve been speculating for years about who will eventually buy who in this robotic software world. However, when it comes to “outright” RPA acquisitions, so far it’s only been bite-sized stuff like Pega/OpenSpan, SAP/Contextor, Blue Prism/Thoughtonomy. While there have been a lot of strategic partnerships and development initiatives between “Big Iron” software and emerging RPA firms, noone has – as of yet – made a concerted move to outright acquire one of the “Big Three” of Automation Anywhere, Blue Prism or UiPath.
However, if you happened to catch Microsoft’s earnings call last week:
“Now let’s turn to our workflow cloud Power platform. Automating workflows across every function will be key to productivity gains for every organization. We are building Power platform as the extensibility framework for both Microsoft 365 inclusive of Microsoft Teams, as well as Dynamics 365. It brings together low-code, no-code app development, robotic process automation and self-service analytics, enabling everyone in an organization to build an intelligent app or workflow where none exists.
Power platform already has more than 2.5 million monthly active citizen developers. Power apps helps domain experts, those closest to the business problem to design, build and publish custom apps fast. And 84% of the Fortune 500 have already created Power applications.”
Oh, the mind boggles when you think where this conversation is heading… so
Is it any coincidence that UiPath is rightsizing itself?
UiPath is popular with developers, which appeals to the Microsoft culture. One of the major reasons UiPath has experienced such popularity is its Ui alignment with developers’ needs. Blue Prism has always been the darling of the business process executives who hate code, while the low-code appetites of developers eager to learn RPA have drawn many of them to UIPath. AA hopes its new platform A2019 is a bridge between both worlds.
Daniel Dines (UiPath CEO) came out of Microsoft, understands the technology overlaps and how they operate. While one can argue that much of the UiPath tech is already present in the Microsoft UI automation ecosystem Microsoft clearly lacks the know-how to pull it all together into one coherent platform that puts AI+OCR+Workflow+RPA+BI in front of both the business and IT C-Suite.
The RPA market “standalone” isn’t where the broader opportunity lies, but it is a critical piece of the jigsaw. As we pointed out over the weekend, the market UIPath (and others) has been hyping up is far bigger than what RPA is currently addressing. It’s the whole discovery, analysis, mining and management of processes and transformation. The recent acquisitions of ProcessGold and StepShot are clear moves in addressing the broader process automation opportunity.
The Bottom-line – After seven years of robotic love-affairs, is it time for the market to get serious?
Let’s face facts, it’s taken an awfully long time for the tech majors to understand what RPA is all about. Low-code software that business users can operate to fix creaking workflows and tasks? Actually digitizing manual workarounds instead of using APIs? Heaven forbid…
But the world of enterprise software is bored, there’s only so much you can bleat on about AI without actually delivering anything real. Rolling your sleeves up and actually using technology to help you redesign processes has always been the Holy Grail, long before ERP came around over two decades ago. RPA is the first time the worlds of real business processes and IT have come together where both business and IT professionals have no choice but to lock heads and figure out solutions that address highly competitive markets.
The tech purists will tell you that Microsoft does not need UiPath – that they have the tech already. However, what Microsoft does not have is a 1000+ customer base purchasing RPA specifically because it is RPA. A customer base where the prime customer is not sitting in the CIO’s organization. It’s also clear that the tech majors are all waiting to see who blinks first with RPA. Just buying up some kit (i.e. SAP/Contextor) isn’t going to do much. Partnering only really works when there is real skin in the game and a colossal global services network to implement and support the product. UiPath can claim is has built a pretty decent global delivery infrastructure and channel to market – and its huge show in Las Vegas was clearly designed to show that off to the world
The bigger issue is money, and how much these big guys are really prepared to spend on this. Sometimes a few billion add weight to an area to get attention, but the $7bn number UiPath was declaring was probably turning them all off. Maybe a little more realism, a little belt-tightening will reinvigorate the desire to take the plunge and make this market real… And there’s also Blue Prism, whose market cap is well under $1 billion these days, and Automation Anywhere who’s CEO likes to talk about IPO a lot these days. All three provide a plug-in infrastructure to the likes of a Microsoft which has ambitions in the process automation world. But – again – who is going to blink first, and did we just see UiPath blink?
Three of the original RPA pioneers (left to right): Some grinning idiot, Pat Geary (Chief Market Maker, Blue Prism) and Jason Kingdon (returning as Executive Chairman of Blue Prism)
So almost exactly seven years to the day that RPA was invented, Blue Prism’s major shareholder Jason Kingdon has scratched a huge robotic itch to make a return to active duty leading Blue Prism to drive its AI roadmap as RPA prepares for its rebirth in the industry. Current CEO Alastair Bathgate (interviewed here), who has overseen the IPO and evolution of the firm in recent years, stays on as CEO, but Jason will be driving much of the technology roadmap and vision with Alastair more focused on the business side.
Jason has a PhD in AI from University College London (UCL) and has been commercializing AI for over 25 years. He was co-founder of the Intelligent System Lab at UCL and Searchspace where he was CEO between 1993 and until its highly successful exit in 2005, when he sold the business to US private equity.
Blue Prism must now grasp these three critical challenges and opportunities
1) Carefully position itself in the industry as the heritage RPA inventor now taking the industry into a new AI-driven phase. While AA and UiPath have been publicly biting chunks out of each other, Blue Prism has soldiered on with its business with minimal noise and hype. In fact, the reverberations from Las Vegas and New York only help drive more attention to the industry and Blue Prism hopes to capitalize… not dissimilar to the amazing work IBM Watson did creating an AI industry for everyone.
2) Roll out a technology roadmap that takes RPA into the AI era. While both its competitors have focused on what Blue Prism calls an “RPA butler service”, proving bots for everyone’s’ desktops, Blue Prism wants to focus on its years of heritage RPA experience managing robots and aligning them with AI capabilities to make them self-remediating and aligned with transformative process roadmaps for its clients.
3) Recreate market energy around itself and its technology roadmap. In typically British fashion, Blue Prism has ignored the noise generated for its high-impact competitors, but now needs to come back aggressively into the market with a laser-focused technology roadmap that is unique to clients and aligned with their deep-set needs.
Bottom-line: This is a marathon, not a sprint and Blue Prism has every chance to reaffirm its former leadership position
Blue Prism did UiPath and AA a huge favor by going public when it did a few years ago, as it exposed the challenges of having its activities open to public scrutiny. However, Blue Prism, under Bathgate’s stewardship, has survived it well to be in a position to make critical investments in its platform that many of its large client base will be delighted to embrace. While its competitors will continue to toy with IPOs and increased private investment, Kingdon and Bathgate now have the luxury of greater certainty with clients and their respect as the original pioneer of low-code technology for business operations professionals. Having Kingdon’s impressive technology passion and prowess at the helm will significantly benefit Blue Prism’s standing in the market and help propel the firm’s offering into the AI era…
Did you hear the one about the GE finance captive spinoff which ended up as a Top 6 AI Services firm before making a bold move into the front office with the acquisition of the respected Right Point Group? And did you hear it broke into the world of digital service capability without ever succumbing to the delights of acquiring an IT services shop? Welcome to Genpact, folks, the former BPO firm which has been breaking the mold of business services for the past two decades.
This is a serious digital acquisition that brings Genpact right into the customer paradigm
Genpact has been slowly but steadily building thought leadership and capabilities around “experience innovation” over the last few years. Genpact’s 2017 acquisition of Design Thinking consulting firm TandemSeven was its first demonstration of the firm’s appetite to develop a OneOffice capability, aiming to move beyond its back office roots and help its clients develop more holistic experiences. It has now announced an agreement to acquire digital consultancy Rightpoint, with a focus on digital transformation, with capabilities for CX, commerce, and mobile application development.
A highlight of the acquisition and one of Rightpoint’s most distinctive features is its expertise for designing and implementing digital workplaces – its work with Aon, for example, demonstrates Rightpoint’s capability to reimagine the workplace. This is such an important element that many companies need help with, as they struggle to connect experiences across the organization and align to the customer.
While TandemSeven gave the firm a flavoring of customer experience design, the sheer size and scale and depth digital tech implementation across North America puts Genpact right on the digital map, with a unique value proposition of leading with process transformation, enabled by AI and digital capability where we can expect a significant jump from its current position, which we assessed earlier this year in our 2019 Design, Sales and Marketing Services Top Ten report. Genpact landed at #14 in the rankings, largely as it just begun developing thought leadership for front office focused offerings and mindshare has been relatively low on our Voice of the Customer rankings. The Rightpoint acquisition is a step in the right direction to move up the value chain – particularly as it can bring in its strong capabilities around data and analytics to fuel the digital transformation roadmaps for its clients.
Genpact will not force its culture onto Right Point as it learns from the Accenture play-book
We view this as the most exciting acquisition yet by Genpact, as it signifies the direction the firm is taking as a process designer, executor and engineer enabled by supporting digital and AI technology. We also see this as one of the most genuine OneOffice investments made by a (predominantly) middle/back office service firm to unify and front-to-back “OneOffice” offering. While we have seen contact center firms such a Concentrix acquire Tigerspike, and Sutherland partner with Google, there have been few moves from traditional BPOs to bring together front and back office delivery with real technology enablement.Other front-to-back moves in the business process space have also been WNS quietly beefing up its call center capabilities in South Africa, Teleperformance’s acquisition of Intelenet and InfosysBPM’s recent pick up of Irish call center Eishtec.
The challenge will be integrating Right Point into Genpact mothership, and keeping it as a separate entity reporting to Ahmed Mazhari (Chief Growth Officer) as opposed to attempting to force a quicker integration into Sanjay Srivastava’s Digital organization tells us that Genpact is keen to retain the culture of Right Point in the initial phases and not force Genpact’s culture onto Right Point’s people. This is more from the Accenture playbook of 36 digital acquisitions to-date, where they learned quickly not to Accenturize these creative firms too quickly.
The Bottom-line: business process service providers failing to invest in digitizing their capabilities across front-to-back offices are in a race to the bottom
The message to today’s business process services firms is simple – you’re dealing with the institutional processes of the world’s biggest businesses. Help align them with the needs of their customers and you will win. Stay doing the same old legacy processing and you’re probably toast in a couple more years.
Believe it or not, if you’re helping clients manage their processes and data, you’re right where you need to be… but you need to develop or acquire the expertise to help them get where they want to go. That means you need to help them design, digitize, automate and self-remediate their processes to stay ahead of their customer needs, as they simply cannot survive treading water in today’s environment. As we recently pointed out, 75% of enterprises will demand significant changes to their services partnerships when they next evaluate their contracts. So providers thinking most of their clients will tolerate them not making significant investments in delivering digital services are going to be in serious trouble (and some are and are fast realizing it).
Well what a week that was in the world that is automation software… while 11 automation leaders at the HFS New York Summit pretty much all agreed that the world that was called RPA is stuck in the mire of making legacy tasks work better, we then were treated to Automation Anywhere’s launch of its new platform upgrade A2019 right afterward at the Nasdaq center, where CEO Mihir Shukla declared he wanted a “Digital Assistant for Every Worker”. A2019 claims its ease-of-use in the cloud, its new plug-ins into Microsoft Word and Excel, and its ability to be run from a mobile device make it the best task support tool in the business. Oh, the timing! Will UiPath stay safe with its status as the “developers favorite”, will Blue Prism stay true to its “friend of the business pro”, or will AA’s focus on bridging a solution for both business and IT with the day?
So all eyes now turn to UiPath’s flagship Forward III event in Vegas next week, where CEO Daniel Dines and his team are under intense pressure to drive an even more powerful narrative for the industry to keep itself at the forefront of robotic software. The onus is on the UiPath leadership, more than ever, to seize the initiative, especially as their noisy competitors are unlikely to keep the brakes off the PR Newswire next week… (Oh and HFS mega analyst Elena Christopher is there speaking, who co-authored the now-infamous “RPA is Dead, Long Live Intelligent Automation” blog. And Kudos to the UiPath folks for having the courage to bring in an untethered analyst viewpoint after some of the recent utter mush we’ve been subjected to at these things. Oh and a woman too, thank God!
Here are the 25 key tenets where UiPath, AA and Blue Prism must draw battle as they look to cross that chasm from RPA to a true digital workforce
Consultants, fellow analysts, here’s everything you need to advise your clients… steal away as HFS is just giving it allll away….
1. Stop counting customers. Start counting and showcasing growth with accounts/scale… 40% of engagements are still in pilot mode, so these cannot be considered long term clients until they get into some form of live usage.
2. Stop hiring armies of salespeople who have no idea what they are selling. Sorry, but we really needed to say that one…
3. Stop amassing as many partners as possible. Prioritize quality not quantity (which would require well thought out partner programs).
4. Stop referring to SaaS as cloud. Seriously just stop. Now.
5. Make the gap between unattended and attended seamless because customers don’t actually want to decide what flavor of automation they need, they just want automation.
6. Start addressing governance and meaningful management of bots in the context of broader workflow. Don’t let massive attended automation and freedom to automate shift from democratization to chaos. address how attended is managed in a way that does not make the IT shops in all of their clients want to abort mission
7. Bring IT and business visions together as one integrated approach. Education must focus for technical and non-technical resources – into communities and educational institutions globally.
8. Shift focus to an integrated automation roadmap – expansion of functionality beyond RPA/RDA to AI and smart analytics. Badging everything as RPA is definitionally incorrect and fails to give clients a roadmap to follow to advance beyond (legacy) repetitive task automation, desktop and document automation.
9. Provide proven scale and depth of professional service to support the SI/advisor channel. This is the battleground where the winners and losers will be decided… if you have the support available to train the channel and your major direct clients, you will get your clients into double-bot figures.
10. You must drive digital change management to help enterprises grapple with transformation with its services investments. Relying purely on Big 4 advisors and service providers for change management will cost clients a fortune and drive many away. This is a key area UiPath needs to take the lead on.
11. Prove it has the lowest-code capabilities of all the bot players. The shift from low-code to no-code is on… proving real no-code abilities is becoming increasingly critical as frustration build with the ease-of development of some of these solutions. This is the real key to proving “one bot for every employee” is truly possible.
12. Really demonstrate you can win in the cloud. This is the impressive push from AA that UiPath and Blue Prism needs to counter… the ability to create public, private and containerized solutions for large automation is one of the main avenues to moving out of pilot mode into a fully industrialized approach.
13. Have the most mobile-enabled bot solution. Moving bot development into the hands of code-hating business professionals is key and having really cool mobile interfaces is becoming increasingly important.
14. The developer ecosystem must be expanded to extend functionality, libraries etc. Commit to specific goals for how much of their codebase will be available on Github et al to build an industry solution skewed against technology-vendor lock-in. Much of this RPA functionality is not rocket science or any trade secret.
15. Commit specific sums to meaningful partner relationships with leading service providers and consultants, including opensource partner technical support systems, events, education resources, and people to help the industry grow
16. Commit to funding local academies (building on their online academies) especially in blighted neighborhoods near its biggest offices to bring young coders and potential customers together with employees for on the job real-world training
17. Must get focused on core business processes by industry, such as supply chain in manufacturing, core banking in BFS, underwriting in insurance, billing in telecom etc
18. Revisit its client engagement model to ensure it is best serving its customer base – its rapid growth in salespeople may expand capacity, but if sales lacks vision, then clients may not be well served (as per comments in our recent survey above)
19. Commits to drawing down technical debt (Every SW company has it, some more than others). As illustrated above, our customer surveys point out which elements of their platforms and solution are known to need immediate re-engineering and investment
20. Identify and subsidize hands-on automation industry experts and influencers whose independent thinking deserves funding and not just focus on checking boxes with legacy analysts. The automation industry is being impacted by many unique stakeholders.
21. Kick off an enduring and sustainable initiative modeled after Salesforce’s 1-1-1 program
22. Invest in cross-technology customer events that will expand overall value creation, for example partnering more aggressively with the likes of Salesforce, Microsoft, Amazon, Google etc.
23. Spearhead an Automation Industry Technology/Business Roadmap that shows a clear path for enterprise clients to progress from basic robotic task automation through to integrated automation and then to achieving genuine AI value
24. Provide sensible RPA pricing options. A “bot” is not a standard unit of measure. It is an abstract measure and a UiPath bot is different than AA and not the same as Blue prism. Yet most continue to price RPA as some of the function of “bots”
25. Focus on actual business transformation. We are using RPA to run ineffective processes cheaper and faster. That is not transformation and is a short term game.
True leadership will come from those who make the most advancements in these versus fancy rhetorical statements and press events. If you want to be a leader…. then bloody act like one!
Unlike the large analyst houses where analysts can be swapped in and out like cogs in a machine, HFS has been built on people, their expertise and their personalities. This is a company where people can shine as individuals and aren’t simply turning corporate widgets to grow revenues and meet targets.
