For outsourcing to continue to grow contracts need to move beyond simply removing cost and in addition add true value to the client. In HfS’s PoV, Defining the Seismic Shift from Legacy BPO to BPaaS we uncovered what BPaaS really entails. In this study, we identified that BPaaS is not simply platform-enabled BPO as some would have you believe. BPaaS contracts are fundamentally defined to deliver business outcomes such as revenue growth, with KPIs and SLAs like average handling time being more about tracking and reporting on progress as opposed to being the only reason for payment. This approach requires a significant level of trust between the service buyer and the service provider – trust that is based on experience, credibility, or the combination.
The focus and purpose of BPaaS are not on how results are achieved, but the fact of achieving them (or not). In some cases, the service provider is paid based on the outcome, such as incremental revenue that is recovered in a collections operation. In other cases, while there is a specific business outcome in the contract, such as increasing medical adherence, the payment is based on a transaction, such as number of patients managed, or number of payrolls processed. For example, Webhelp’s contact center contract with UK retailer ShopDirect, whereby Webhelp is paid through a combination of FTE pricing and an outcome based model that varies according to service line, examples of outcomes include revenue gained, first call resolution rates etc.
With the amount of control placed in the service provider’s hands, trust is the key building block in BPaaS contracts.
BPaaS contracts are very seldom undertaken by first generation outsourcers. The level of trust involved in handing over complete control of processes is not something buyers are willing to undertake lightly. More often than not these BPaaS contracts evolve from well-established and successful BPO deals.
Another aspect to consider and something I have recently witnessed firsthand as I’ve visited a few South African BPO service providers (jealous much?), is the location of account management teams. Almost without exception, traditional BPO contracts I have witnessed have a top-down directive account management team based onshore with the client. This creates a further barrier to communication between service delivery and service destination, which can potentially hinder the development of trust needed to move to a BPaaS contract. Conversely, all BPaaS contracts I’ve covered during my time here have a dual account management function with one onsite at the delivery location and the other onshore near the client’s head office.
Is this dual account management function a symptom of a BPaaS or is it a key enabler of making these BPaaS contracts happen? The answer, more than likely, lies somewhere in the middle. This dual account management function creates a more fluid communication channel between the delivery center and the client. This communication helps to dispel the fear of complete loss of control from the client side and lead to a greater degree of trust.
Bottom Line: The key takeaway, however, is that this dual account management function could be a key factor in facilitating the transition from traditional BPO contracts to BPaaS partnerships by increasing communication, trust, and onsite presence.
Security’s a hotbed of complexity – many different kinds of threats, technology that’s evolving all the time, and businesses can’t keep up. Changing standards and incredibly complicated threats make most non-technical buyers either throw the problem over the wall to their technology team (and miss out on the value of a business-led security approach) or their eyes glaze over at the mere mention of security and never really give it the attention it requires.
And what’s worse is that this complexity isn’t getting better, it’s getting worse. That’s why we all need to get over our apprehension, fear, boredom, and whatever else is keeping us from really understanding what we need to do in security. The best way to do that is to keep a business-value focus on it, making sure we learn what we need without digging too deep into the weeds and getting frustrated?
Bridge the divide between the highly complex and the need-to-know by focusing on three core, interrelated areas:
Digital trust: Your ability to succeed in the digital environment requires that your trading partners (customers, suppliers, external stakeholders) trust you to be ethical, legally operating, and practicing up to date security procedures to protect their data and IP. If others start to doubt your ability to secure your own data or theirs, you are dead as a business. It’s pretty simple as a concept and amazingly complex when executing.
OneOffice: Digitization and the renewed rise of customer-centricity mean that the wall between back office and front office has collapsed – everyone in a company is customer facing in this age where customers have significant visibility into our internal operations. That means your security policies, procedures, and risk approaches need to be brought up from the basement and shared across your entire organization.
Shared responsibility: Security isn’t just something you worry about within your four walls anymore. As data and IP get shared across trading partners, the need for a shared view on securing digital assets becomes critical. Everyone in a trading network owes the other members a secure environment, so sharing accountability for security will become the new normal.
We started our security resolution early by publishing new research that defines the eight prerequisites of digital trust, including data integrity, business alignment, and device security, among others. And then we’ll be building on that by publishing our findings on how well service providers can help clients with managed security services for digital trust in February 2017.
Don’t be intimidated by security challenges, put them in the context of your business and make progress toward digital trust. Here’s to a secure, business-focused 2017!
The range of information managed in HCM Systems is quite impressive, and in most leading platforms, encompasses data relating to the 3 legs of the proverbial (HR data) bar stool: Administrative, Transactional and Strategic data. Administrative covers what’s needed for policy and regulatory compliance and core HR process support (on-boarding, payroll and benefits admin, etc.). Transactional covers the events in an employee life cycle (changes to job, organization, supervisor, compensation, etc.) or personal life event updates that impact employee benefits for example.
Strategic data covers … hmmm … maybe just see Administrative and Transactional.
Is this HR heresy? Is it a yearning for the simpler days of Personnel Management when key business strategy decisions often excluded HR executives, HR/HCM systems largely weren’t used outside HR Departments, and Talent Management was a term reserved for Hollywood? No, it’s only a lead-in to a question I’ve asked myself over the years, namely: Are we missing something when we point to data tracked on HCM systems like performance ratings, compensation and job progressions, training courses taken or competencies displayed and say this allows us to be very strategic in managing human capital?
Yes we are probably missing something. It seems the data we track in these technology assets, while broadly useful, might sometimes be obscuring the real mission at-hand: The need to manage and provide ready access to WHATEVER people data enables a highly engaged and productive workforce, and the proactive management of business risks and opportunities … thereby creating and enhancing sources of business value and competitive advantage.
So What Needs to Change?
For one thing, let’s not forget the aforementioned mission at-hand. Let’s also not forget that employee engagement, retention, productivity – and business innovation and agility – are all HCM-related themes but they are NOT HR processes with routinely defined steps that can be system-tracked or enabled. Perhaps just as important, these themes rarely have a single process owner with a budget (for enterprise software) that solution vendors can sell to. The main implication of this is that while HR Tech circles continue to espouse moving away from being too process-centric, and being more ‘desired business outcomes’ centric in our systems design and usage, the HR/HR Tech disciplines can perhaps be faster on the actual uptake of this.
3 Examples of (Non Process-Centric) HR Data Worth Tracking
Employee Value Indicators … present a broader picture of the employee’s value to the organization, far beyond performance ratings or competencies. These dimensions or data points might relate to referring candidates who became top employees, serving as a mentor to new employees, suggesting ideas that led to new revenue sources or operating efficiencies, or forwarding personal contacts that were great sales leads and became customers.
And speaking of competencies, how about Latent Competencies … those that employees possess that might be invisible to the organization, and therefore not leveraged, because they are not relevant to an employee’s current job function. These would be pretty handy when a major shift in business strategy is considered which has implications in terms of re-tooling the workforce. Also Competency Value Trajectory (or “CVT”) would be a simple way to note on the system which competencies are becoming more important to the organization due to impending business undertakings.
And finally, one that arguably qualifies as not seeing the forest through the trees, all the valuable data that could be tracked around Career Goals … including how an employee’s goals change over time, progress toward achieving them, and what the organization has done to support them. This way of driving employee engagement could fly by the positive impact of employee surveys or various (non-sustaining) forms of employee recognition for 2 reasons: Employees perceive their needs/interests as being important to their employer; and management decisions about leveraging their people better align with those needs/interests.
Bottom Line: HR Tech’ers should not forget about the virtually limitless potential of these platforms to house strategic, and often non-process centric data
A focus group I conducted a few years ago with a dozen CHRO’s addressed where HR Technology was — or wasn’t — making a difference in their organizations. The consensus was that managing the potential fallout from downsizings, or the people aspects of M+A’s were areas where HR Technology was not playing a major role … both obviously more about potentially game-changing events than defined HR processes.
As HCM system configurability and extensibility capabilities have achieved new heights in recent years, addressing these perceived (historical) system shortcomings have perhaps become a matter of customers doing a better job of defining decision support needs and related data capture processes, and simply leveraging their HR Technology assets better in general.
We did in once, we did it twice… and I bet you never thought we’d do it a third time. Yes, amigos, it’s the 2016 airing of how effective the leading service transformation providers are in that beloved RPA space that just refuses to go away…
Ever since HfS bought the topic to the attention of stakeholders back in 2012, the robotic thrum of RPA throbs louder and louder. With the conference circuit over-flooded with more and more RPA conferences, robotically repeating the same rhetoric, the actual RPA deployments are significantly scaling up and M&A in the space is gaining momentum. Yet, true meaning and definition of what truly constitutes “RPA” are as blurred as ever, as more people jump on the bandwagon who couldn’t define cognitive vs digital vs autonomics, if their job really depended on it. Enough reasons to take stock where this industry is at, and add some definition and clarity to this fuzzy world into which we’re stumbllng. With that in mind, we asked our analytical Automation Overlord, Tom Reuner, to talk to the industry’s stakeholders who buy, sell, implement and generally go nuts over this stuff… and take a fresh look at the market dynamics.
So, Tom, amidst all this noise what is really going on in RPA these days?
Noise is a good way of describing it, Phil. Yet, underneath the surface, we are seeing clear signs of maturation. This maturity manifests itself in different ways. The pace of change in which the suppliers are building out automation capabilities is nothing short of astounding. Most providers are embracing a holistic notion of Intelligent Automation ranging from RPA to Cognitive Computing to AI all the way to self-learning and self-remediating engines. However, we must be careful not to confuse building out capabilities with traction in the market. At the same time the leading tool providers such as Blue Prism, UiPath and AutomationAnywhere are expanding their capabilities mostly toward operational analytics and the broad notion of cognitive. Lastly, buyers demonstrate a much more solid grasp of the implications of RPA, both on the technical side as well as around the business implications. Mature sourcing organizations are starting to build out automation centers of excellence cutting across business units and automation technologies. Thus, the tool-centric discussions (often a pure tick box exercise) of the early RPA days are getting less and less.
However, despite all those positive developments there continue to be constraints. The key one jumping out is the scarcity of talent. Putting a bot into a process is not too difficult. Scaling them up to an industrial level and having both the technical know-how and process knowledge is quite another thing. It is here where the differentiation between the various providers is starting to crystallize.
What has really changed since the last HfS RPA Premier League Table?
Really all change, Phil. The 2015 RPA Premier League Table was a reflection of a still nascent market. At the time, Charles did a great job of benchmarking providers against the HfS Maturity Model, but invariably the emphasis was still strongly around the strategic vision and the effectiveness of the market communication. In 2016 the market has strongly progressed toward understanding and applying RPA as transformation projects. We are finally starting to overcome the early misconceptions that RPA is a turn-key solution, non-invasive, low risk and largely focused on replacing FTEs. Not least from many failed projects the market has learned that, unsurprisingly, life is much more complex. Underlining this point, RPA tool providers have progressed to push notions of virtual and/or digital workforces. Equally, RPA increasingly is seen as part of an automation eco-system rather than a silver bullet.
As a direct consequence, the market is becoming increasingly bifurcated. The leading providers that are heading the 2017 iteration, are positioning RPA as transformational projects. The process owners have been put back center stage and discussions focus on the whole continuum of Intelligent Automation rather than just RPA. Aligned with that data curation is becoming increasingly a focal point as organizations are advancing toward the As-a-Service Economy. With that, we are seeing the rise of the Big 4 but also organizations like Alsbridge who is expanding from broader sourcing advisory. However, the other half of the market remains stuck in understanding RPA as a placeholder for short term cost take out, task automation, often on a sub-process level and often without the knowledge of the process owner.
Lastly, M&A is accelerating with Pega having acquired OpenSpan and just this month ISG acquired Alsbridge. And the market is rife with rumors about more transactions. In our view, M&A is a strong benchmark for increasing maturity as money talks louder than PowerPoint.
So Tom, what was your methodology behind putting together the 2017 RPA Premier League Table?
The RPA Premier League Table is building on and following up on the discussions for the HfS Intelligent Automation Blueprint. Thus, RPA should be seen as a subset of the broader service delivery capabilities of the service providers. The input for the Blueprint was enhanced by additional material and discussions with the respective service providers. Additionally, we had discussions with Blue Prism, UiPath, and AutomationAnywhere to get a steer on their partner eco-systems. Based on these inputs we have evaluated the services providers against the following criteria:
Vision and credibility of RPA strategy
Driving value through end-to-end process view as opposed to short term cost cutting
Breadth and maturity of internal tools and external partnerships for RPA
Scale of deployments
Integration of RPA in delivery strategy
Commercial traction
Effectiveness of marketing effort behind RPA strategy
Not beating around the bush, who is standing out as RPA performer?
Phil, the leading providers are blending a holistic approach to automation with broad transformational capabilities. Top of the tree is Accenture who is complementing its consulting capabilities and a plethora of third party tools with its new proprietary Accenture Robotics Solution. The solution is modular and able to integrate optional technologies for each client, for example, by using Google or Facebook APIs when needed. Deloitte is the strongest riser in the RPA Premier League Table by pushing a holistic transformation agenda. Cognizant’s automation team within the Emerging Business Accelerator (EBA) is at the vanguard of educating the market place on the implications of automation. Close behind the leaders is EY and TCS. EY has embedded its RPA approach into the broader Smart Automation Framework with a strong focus on transformational projects helping clients to move toward self-service and CoEs. Conceptually, EY is moving toward the notion of the OneOffice. TCS’ RPA approach has significantly matured, in particular by embracing a hybrid tool strategy and by focusing its go-to-market around nuanced use cases. However, the context is by no means just BPO centric scenarios. Atos and Capgemini are examples for driving RPA tool sets into application management scenarios. Alsbridge stands out as one of the few sourcing advisors, and the only one with a global presence to expand its capabilities into RPA implementations. These capabilities were a key consideration for the acquisition by ISG.
Gazing into a crystal ball, what can we expect for 2017?
If I would have all the answer, Phil, I could make a lot of money. But on a serious side, two issues are standing out for me. First, M&A will accelerate and disrupt the market. Following on from the acquisitions of Alsbridge and Automic, leading tool providers as well as the leading pure-plays are likely to be absorbed by acquisitions of the next 18 months. This might lead to more proprietary tools being developed, both to mitigate those risks but also to allow for broader functionalities. At the same time, go-to-market strategies have to be adapted as the large management consultancies will play an increasingly dominant role as RPA deployments will pivot around transformational projects. Second, the rise of Virtual Agents. We will see increasing traction of virtual agents that will fundamentally change the notion of service agents. These deployments will push more holistic automation approaches while disrupting workforces. Thus, these agents will increasingly offer broad management capabilities such analytics and integration capabilities for code and files. Therefore, the focus will shift toward enabling a seamless customer journey underpinned by broad knowledge libraries, dynamic case management and above everything else NLP. Thus, RPA will have to be part of ever more holistic automation approaches.
So who do you call when you want a robot? When we embarked on the 2016 RPL, we had to evaluate all the professional services firms operating in the space – both to help clients develop an RPA roadmap, evaluate the RPA software options and alignment with their processing requirements, and ultimately get some help implementing the solutions, developing out the RPA team and creating a workable robo/human governance structure. In addition, many clients find themselves in conflict with their BPO providers and need third party help to bring them together to find workable risk-sharing compromises.
What has transpired is several smart people, mostly working for BPO firms, eyed the RPA value proposition emerging, shortly after time we introduced RPA to the services industry in 2012, and they hatched plans to jump ship, club together and do lots of consulting work to build up their organizations.
Due to the murky, complex – and often very technical – needs of RPA, the demand for skilled expertise from real specialists is unprecedented – which is why we’ve seen the Big 4 leap into this space – but also why we’re seeing some of these small, highly-focused, players in real demand. And they’re not only making money working with clients seeing to RPA-ify BPO and shared services environment, they are also training many of the service juggernaut services to implement RPA for their clients. In short, there’s a lot of business to go round and you will often see these curious RPA pureplay folk huddled in the corners of conferences, sharing war stories and even passing business over to each other because they ae simply too overwhelmed with client demands to take it all on.
So, without further ado, let’s take a look at the seven candidates out there in all their naked glory….
Wipro has recently been firing on all cylinders to get going on its ‘drive the future’ strategy for growth. We wrote about their smart move on acquiring Appirio with the opportunity to bring together consulting, IT integration, BPO, and global delivery scale. From my recent conversations with its analytics leaders, I’ve seen a similar “combination” strategy resonate around Wipro’s analytics stack.
The new Data Discovery Platform, or DDP, is becoming its flagship solution for exploratory analytics projects in the big data realm. It features industry apps and is built using open source technologies, including a Big Data Ready Enterprise (BDRE) data product from Wipro as its data ingestion layer. This platform works across the lifecycle of managing data in an enterprise data lake that makes it possible to ingest, organize, enrich, process, analyze, govern and extract data quickly, significantly accelerating a big data implementation in a cost-effective manner. The DDP is beginning to find meaningful examples with enterprise clients, with upwards of 50 engagements in some stage of piloting.
Apart from DDP, we heard other examples where Wipro is trying to evolve its role to deliver more business value in analytics engagements. What is interesting among all these is Wipro’s approach:
Placing a greater focus on partnerships: DDP, for example, relies on a partnership driven ecosystem, along with open source technologies driving the core. For a life sciences client that has not yet invested in a data lake and gone down the path of setting up its big data infrastructure, Wipro has sought out and partnered with companies in areas such as data cataloging, to stitch together a joint value proposition. It is also actively evaluating how its portfolio can be enhanced by leveraging:
partners such as Tableau and Trifacta
internal capabilities such as Wipro Holmes, which is under the CTO’s umbrella but is being leveraged by the analytics practice for NLP, ingesting unstructured data and automation
companies in which it has made investments such as Talena and Opera
Taking more risk to deliver value: The value of bringing new thought – and more importantly – new actions, cannot be underestimated for a service provider like Wipro that has over a decade of delivering standardized data and analytics services under its belt. A financial services client expressed interest in bringing more integration in its BPO processes and the reporting, BI and data services that Wipro delivers. The service provider collocated the teams and is exploring collaborative opportunities to improve the overall business outcomes for the client from both service areas. In another example, Wipro is making joint pitches to consumer-facing enterprise clients in collaboration with a leading direct mailing company. The combination of the company’s vast amounts of valuable consumer data with Wipro’s big data capabilities is enabling them to have a more meaningful impact on multichannel marketing through targeted consumer insights.
Investing in new kinds of talent: Wipro has recognized the need for more consultative, business-led conversations and expertise as it tries to make its way from the CIO’s office to analytics decision makers in other parts of the client organization. It is steadily building a team of consultants in the U.S. that have functional/vertical experience from working in the industries, working knowledge of analytics and data sciences and can drive early conversations with clients to evaluate their needs, frame the right use cases and work with analytics teams to deliver results against them. Data platform engineering is another area where Wipro is starting to hire new talent locally to help build out the layers of technology required to run analytics in the future, including data architecture, data mining, search indexing and machine learning. To create a business-focused culture, Wipro’s analytics business runs its own competitions like Datathon, and participates in the TopCoder community for data science and advanced analytics competitions.
Bottom-line: The potential is there, but Wipro’s real challenge is aligning analytics beyond the IT function
We believe that these leading indicators of change are promising, and could help Wipro with its goal of more ‘drive the future’ digital engagements, using analytics as a key lever. What is yet lacking is a cohesive and simplified messaging around all the new and ongoing activities. Wipro’s analytics leadership is out there with its technology vision and roadmap (e.g. what information architectures will look like in the future and what partners to work with). We’d like to see how Wipro builds on this approach to champion and enable non-IT (or non-techie) analytics decision makers with an industry and functional lens.
As we dived deep into procurement for the Procurement As-a-Service 2016 Blueprint, we had a lot of almost philosophical conversations about the future of procurement. About the fun stuff, not the procurement grunt work like invoice processing, PO matching, accounts payable. No, about cognitive procurement, predictive analytics, procurement being completely automated and invisible.
Amara’s Law concluded about the future and our estimations thereof: We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run. Bill Gates famously paraphrased: “We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten.”
So, here are our overestimations and underestimations for procurement in two and ten years’ time:
Overestimations … within two years: * Service providers successfully scale the knowledge of their scarce category experts with brilliant cognitive solutions. * P2P platforms completely automate away manual transactional procurement. * Suppliers are completely digitized on what we used to call Supplier Networks or Business Networks and now know as collaboration platforms. * Service providers have adopted on-demand As-a-Service to the extreme – they don’t talk about multi-year contracts or total contract value anymore – just about number of subscribers, active users, churn, annual and monthly recurring revenue (ARR / MRR) growth. * Amazon takes over the B2B Marketplace (if in Asia – Alibaba). Amazon Business is the de facto marketplace in B2B. * If you’re looking for the Procurement department, follow the signs: Brokers of Capability. * Competition from outside outsourcing or procurement disrupts outsourcing of specific categories – like DHL in logistics. * With Blockchain cemented into the core processes, we also pay in Bitcoin.
Underestimations, or what we’ll see (!) in 10 years: * Algorithms will decide the preferred supplier du jour. * Algorithms will determine what, how, where and when to buy, show you options and recommendations. * No one touches an invoice or a purchase order. Blockchain and smart contracts take care of transactions. * Some categories disappear (probably office supplies – as we go paperless, you can bring your own pen or pencil (BYOP). * Connected assets (IoT) in value chains will tell algorithms what to buy and when. * No need for approvals, the algorithm got it. * Predictive analytics decide what you need – the system knows our needs better than we do. * When I want to buy something algorithms, and analytics didn’t figure out already, I just tell Alexa to get it for me. * Stuff will unexpectedly appear on your desk or doorstep. * Fedex and UPS will help return stuff you, after all, didn’t need….by a drone or an Uber.
Bottom Line: The future is already here – it’s just not evenly distributed yet To end with the famous quote from William Gibson. All the forces impacting procurement and driving our overestimations and underestimations are here today. Some very nascent and aspirational – cognitive procurement, IoT, Blockchain, true predictive analytics. Others have been embraced by the market and broadly implemented into procurement and Procurement As-a-Service offerings – procurement platforms, supplier networks, intelligent automation. Ask yourself; will you be on the overestimated or the underestimated side of this transformation? Figure out what the future looks like for your procurement function and start preparing now or risk becoming obsolete.
How do you change a workforce and shift performance management from status reporting and check-ins to an outcome-based approach?
With Pokemon Go! hot news in the press and, frankly, in my house, this summer, I was reminded of an example of gamification used effectively for performance improvement, financial impact, and employee development and engagement at a US healthcare system.
The director of revenue management and patient financial services brought in gamification, along with training and outcome-based performance management, as part of a change and quality management program. Along with an increase in AR staff productivity and engagement, the impact on the business included an increase in payments, a decrease in net days in accounts receivable, and a decrease in denial turnaround time.
Mission: Quality Control
This healthcare provider has a centralized business office that manages the revenue cycle for a group of medical facilities. Within this office, the director launched a mission to certify every one of the over 80 staff coders, having learned that the ability to resolve a claim on the phone with payer is 40% more efficient than if the staffer is not certified. While he hired a coding instructor, he also realized that to really have an impact, the team of coders needed to take ownership and be engaged, to want to learn—so why not inject some competition and a little fun? To make the program less of an “attack,” and more of an incentive, the director worked with HR and marketing to build a program around it—with logo, t-shirts…and a game, one that has helped to drive higher quality and revenue impact among all ages of staff.
This is a great example of up-skilling to generate higher quality results…and also add an element of “competitive and spirited but team oriented fun” into the work environment.
“You can’t learn if there is no proper feedback on a consistent basis,” shared the director. “Accountability through transparency into progress and issues as well as communications is key.” So he found a tool that would generate progress reports on a recurring basis, without being overwhelming: UpdateZen. is a mobile-based program management app that allows team members to share relevant and timely updates in 240 characters or less. This way, the management team can stay on top of a project based on the targeted milestones and deliverables, and not on “what did I do today” updates.
In addition, they set up a scoreboard so that every Monday, employees see which of their assignments are on track, what’s outstanding or delayed, etc. There are online rewards and visible “stars” for exceeding expectations, a leaderboard to show rankings, and call outs for “Top Producer,” for example. The scoreboard also reflects measures for productivity and quality, with flags for where there are suggestions for corrective actions or training.
In the scoreboard, the performance measurements are grouped by outcome. That’s because another element of the program for this operations team is to tie performance to revenue-generating outcomes. As such, there is a revenue indicator associated with each group of assignments. Employees and the management team can see how the work they are doing impacts business results. Of course, there was work “behind the scenes” to tie the work to the business outcomes, and that’s where an analytics professional played a key role.
Powered by performance analytics
The team that defined and implemented the outcome-based performance management with gamification engagement scorecards included an analytics expert from the patient financial services department, and HR and marketing professionals. The effort included identifying performance metrics mapped to business outcomes, defining workflow, performance management and HR coaching. During this time, the staff was also kept up to speed and involved in the effort so that by the time the program went live, there were no big surprises. Along the way, there were people who realized that the new way of working was not for them, and some moved to new roles or left—and those who did shared that they at least appreciated the feedback and interaction the approach created.
Quality and employee engagement results…with more to come
The program has resulted so far in a reduction in denial turnaround time, with higher quality work. The team continues to add to the usability of the system—increasing the use of automation for work that does not need to be done by people on the team, and continuing to add and change the metrics to ensure a continued focus on quality improvement. While the shift to outcomes-based performance management is still a work in progress, this effort does show how bringing together a team—revenue management, patient services, HR, and marketing – can work together to define and roll-out cultural and process changes to move towards an outcome-based and outcome-driven environment.
Pokemon Go! served a role in getting people of all ages engaged in a fun and spirited competition, but also drove change. It unintentionally became the means by which some people learned new skills (using GPS to get home after biking into “new territory” to catch Pokemon), interact in new ways (in the real and virtual worlds), and inspire new marketing and sales opportunities. It also breaks down something big—change in culture, process, and technology—into something smaller and engaging. Infusing a gamification approach into the business can motivate, inspire, and also align people around a shared or similar goals.
There’s been an awful lot of focus on the emerging Robotic Process Automation (RPA) solutions since we unveiled the concept to the services industry in 2012. While early movers, like Blue Prism, have stolen most of the early headlines in the space, we’ve seen other very effective tools and platforms emerge, such as Kryon Systems, UIPath, WorkFusion and Nice.
However, one solution has been especially rampant in the BPO space (especially in finance and accounting) – Automation Anywhere – whose team has been working tirelessly with leading providers such as Genpact, Accenture and EXL to streamline processes and drive all the associated benefits of automating high volume, high throughput tasks that were previously plagued by unnecessary and costly manual interventions.
So we felt it time to sit down with Automation Anywhere’s brainchild and co-founder Mihir Shukla, to learn a little more about what is driving this unprecedented demand for RPA, and where this is all leading as we venture into curious times…
Phil Fersht, Chief Analyst and CEO, HfS Research: Good afternoon, Mihir Shukla. You’ve been at the forefront of so much of the new thinking and ideas in RPA and Intelligent Automation in the last couple of years. Automation Anywhere almost came out of nowhere. So I’d love to hear a bit more about your background and how you really ended up leading this firm. What was the journey?
Mihir Shukla, CEO, Automation Anywhere: Good to talk with you again, Phil. It’s interesting when you look back, how you end up with something. I came to the US to do my PhD around the time when the Internet was just coming around. So I got the disruption bug, and it was a lot more fun disrupting different industries than doing a PhD. 22 years later, I look back and I’m fortunate enough to have led five or six large disruptions in various capacities. First, I started at Netscape, where I had a chance to shape the era of the Internet. Then I worked at Infoseek, which was one of the early search engines, where I got to help define how to access the Internet, how you discover things, and we built an early eCommerce platform. Then I had a chance to be an advisor to OmniSky, creating the first Internet-enabled smartphones. I still remember the time when I was one of the 14 guys in Silicon Valley who could go anywhere in the world and find the nearest restaurant. Today, there are a billion of us who can do that.
There was lots of learning along the way. The genesis of Automation Anywhere came from one of my last disruptions, which was at E2Open, where I had the opportunity to integrate the supply chain of the top 10 high-tech companies. At that time I had a chance to use various BPM tools, enterprise application integration tools, and ETL tools. It was during that experience that I saw the challenges faced in trying to integrate a global supply chain that includes hundreds of applications and thousands of people.
I thinking at that time was there must be a better way to do this.
So in 2003, we started Automation Anywhere—and that was a genesis of RPA. Of course, it wasn’t called RPA back then. But the idea was to simulate human behavior on a computer and be able to automate everything we do on a computer screen. And 13 years later, we’re the largest provider of RPA solutions. So that’s how it all started, and that’s where we are today.
Phil: So what can you share with us about Automation Anywhere secret sauce? What is it that makes you guys tick? What is it that you feel has been the catalyst to this hyper-growth that you’ve been experiencing?
Mihir: There are quite a few things that we do very differently, that are unique to us. First of all, we’re the largest and most fluent platform on RPA today. We have over 500 enterprise customers, the highest number of bots, many large deployments on our platform, and the highest ROI. What that means for a customer is, as I said, the most fluent platform. So the product is a lot more mature, our practices are a lot more refined and we’re a lot more humble as a result of all of that.
Anyone looking at RPA today will see a company that arguably owns 60% or more of the market share—which is us. So that’s the first one.
The second secret sauce ingredient is that, in addition to being the largest RPA vendor, we’re also the only one who has a digital workforce platform. It is a combination of RPA, cognitive and analytics together. What does the combination of these three things mean? One is that if a typical RPA vendor can automate 10% of the processes, our platform can automate 60% or more of the processes, with the combination of the three capabilities together. So what you can automate is significantly broader.
The second part is in terms of returns. You have reported that RPA gives returns anywhere from 30% to 70% and there are some examples of a few hundred percent returns as well. With digital workforce, you could get two to four times more return than just the RPA platform. For one of the large telecom customer, there is an 18,000% return. Yes—18,000%. Almost unbelievable, right? Digital workforce can deliver significantly higher results. So that’s the second big differentiator.
The 3rd differentiator is that often in the industry for RPA implementation you either get scale or you get speed. But how do you get scale and speed? To our knowledge, ours is the only platform that can get 50 people worth of productivity in six weeks, and 500 to a 1,000 people worth of productivity in one year. I have not heard of a single installation outside of ours that can deliver this level of digital transformation.
We also have the largest partner channels—17 of the top 20 companies are our partners. And there are more than 10,000 people trained on our platform in the industry today.
Let me mention one last differentiator. Maybe you’re familiar with it. BotFarm is one of our latest innovations. It’s a bot platform that can deliver anything from 50 bots to 5,000 bots—with a click of a button. Where you need it, when you need it, for however long you need it. That level of scale and speed is just one example of how we deliver. So those are a few things.
Phil: Mihir, you talk a lot about the digital workforce and digitally shared services. What does this really look like, Mihir?
Mihir: A few years back we were looking at what was next. How do we take this beyond what we deliver today? That, for us, is the digital workforce—it’s the next generation of RPA.
Think about it, Phil, what do all of us do at work? About four things.
We think about things, then we do it, then we analyze it, and we drink coffee. Now, think how do I augment these capabilities with technology, of course except the coffee? So cognitive thinks with you. RPA allows you to do things better, faster, at digital speed.
Our real-time analytics allow you to analyze. So now technology has given us a way to augment thinking, doing and analyzing. When you combine them, you get a digital worker with all the three capabilities that we require at work. Each one by themselves is a huge wave, as we know. Combine them, and you get a tsunami. It is the true digital workforce that will lead the next wave in the industry.
Phil: That’s good to hear. You’ve moved so fast as a business. So as you look out where you go next, where does Automation Anywhere develop its capabilities beyond automation? What does the long-term product roadmap look like as you peer into the future, Mihir?
Mihir: Okay. So I think we have come really far, but there is a long way to go. There are two areas where we focus significantly. One is, as I already mentioned, scale and speed.
So, today we can do 50 people worth of productivity in six weeks and 500 to 1,000 in a year. We’re now looking at how to do 200 people worth of productivity in six weeks. How do we get to 5,000 people worth of productivity in a year? How do we push this digital transformation speed even higher?
In the next year, you will see series of innovations from us in various areas, all pushing the boundaries. We’re heavily into R&D investments, Phil. We have about 150 people in our R&D team alone. So one thing for sure is you can expect some amazing things in the next year.
One area we focus on is integrating cognitive RPA and real-time analytics—looking to make it more and more seamless, and more and more powerful. So, take an example of our cognitive solutions today. After many years of effort, we have reached a point where you could get up to 80% return in two months. One of the challenges in the cognitive world has been how to train your system that fast.
It typically takes a long time. I’m very proud of our R&D team here. To achieve that level of sophistication, where you could train a system in just two months, where 80% of the straight-through processing is possible. It is an achievement, I humbly believe.
We’re going to push those boundaries even further and combine these three capabilities to take it to new levels.
Phil: Good to hear. So finally, then, I’m going to give you the keys to the kingdom of automation for one whole week. If you can do one thing to change this industry for the better, what would that one thing be?
Mihir: I like the question already. What would I like to do? Am I dreaming here, or do I have to look at all the constraints?
Phil: One thing you can do with full empowerment.
Mihir: I think I’m going to take the license to One A and One B. There is so much domain expertise and knowledge with service providers. But digital transformation is coming through and they need to re-invent. So I would take service providers private, automate 40% to 70% of everything they do, go back to the public market with three times the valuation and three times the profit.
Easy to say, but there would be a lot of challenges.
The second one is in the shared services space. If I am doing 10 functions, 10 areas where I am doing shared services, I would take three of those functions and make digital workforce the first strategy—and this is not me dreaming, we should start doing it in my opinion.
What it means is that I don’t need a reason to automate. I need a reason to do it manually. It should be digital workforce first.
It should be all digital unless it is required not to be. I would start pushing that way in my shared services and take it from there. In five years every business will be a digital business, operating like Google, Facebook, and Uber. That’s how the world will be in five to seven years. You start there, by taking three departments and say goodbye to manual.
Phil: I think that’s a really good answer!
Mihir: Are you going to grant my wishes?
Phil: I definitely like the one about taking the service providers private. That would get them out of this quarterly mindset and they might actually do something to prepare for the future and not just the present. Being able to help their clients get ahead of digital disruption is very smart, because the biggest threat to the industry right now isn’t automation, it’s digital disruption.
When you look at the Fortune 500 in three to five years time, it will be made up of all these digitally run businesses. Like for example, an insurance company can come along with an Uberized-type delivery model to compete with an Allstate or State Farm, which has 10,000 people onshore processing insurance claims on green screen technology. They’re out of business overnight! You can look at digital banks, for example, targeting millennials with pure app-driven bank account capabilities.
The disruption can put these guys out of business so fast. And they need to pivot a strategy. They need to understand what is happening, so they can react to it – staying ahead of the curve and not reacting to it.
We’re even seeing some clients investing in startups so they can almost move into a startup type model, to get out of the model they are in. So I think helping clients understand, combat and pivot against disruption are really the keys here. Thinking with a digital-first mindset, which you’ve laid out very intelligently, is exactly the way to go.
Mihir: You know, I recently had a chance to travel around the US, Europe, India, and other some Asian countries. I met about 50 of the Fortune 100 leaders, one-on-one. I asked them when digital-first will really take hold. I was talking to people from all industries—banking, financial service, insurance, manufacturing, retail, oil and gas, healthcare and others. Each one of the leaders had a model on when they must fully go digital.
Very surprisingly, almost everybody had the number at around seven years. It was shocking to me, that almost regardless of industry everybody says that in seven years, if they didn’t have full digital scale, they would face an existential threat.
But I would say the countdown is five years. Because no employer or investor is going to wait for rock bottom. What do you think?
Phil: I think it could even be sooner than that…
Mihir: Is five years a good countdown or would you say other industries have more time, before they have to push all-digital button?
Phil: It depends on how we define digital. But I think in some industries we’re seeing the all-digital button being pressed now. So, in retail and travel, I think it’s being pressed now and it’s probably more like two to three years for them. In something like maybe banking, probably more like five to seven. Insurance, maybe three to five. Media, it’s already here. So, I think it depends on the industry. But seven years is probably the slowest. Some of them are already getting in now.
Mihir: Good answer, Phil!
Phil: Mihir, this has been a great, enlightening discussion. Thanks for joining me. I know our readers will enjoy this.
Mihir Shukla (pictured above) is CEO and Co-Founder of leading robotic automation solution provider, Automation Anywhere. You can view his biohere.
It’s quite the humbling experience when your fellow professionals recognize your achievements. The HfS Research team should be very proud of being awarded both Independent Analyst Firm of Year and Analyst of the Year for 2016 by the Institute of Industry Analyst Relations (IIAR), which covered 170 analysts and all the global and boutique analyst firms.
