What is RPA?
November 27, 2021
What is RPA?
Most adopters of RPA, or Robotic Process Automation, are industries that have tasks with relatively simple rules to execute but in huge volumes. With much of its work involving data entry, compliance regulations, statement processing, balance sheets, etc., it is not surprising that Banking and Financial Services is the top user-sector, accounting for nearly 30% of global RPA revenues as of 2019. Other user sectors are Insurance, Healthcare, Manufacturing, Transport and Logistics, and Utilities.
More and more industries are adopting RPA however as it increasingly demonstrates both higher efficiency (speed and accuracy) and lower costs. No wonder RPA is expected to grow at over 30% p.a. annually over the next six years.
So what is RPA ?
Robotic Process Automation is an application of technology to automate business processes without human intervention. It handles high volumes of data and performs repeatable tasks. Humans can provide instructions to the robots using different RPA tools to automate the processes.
Let’s elaborate as follows:
- Robotic: Mimicking a human user
- Process: Sequence of meaningful activities making up a process. Typically involves systems/applications
- Automation: Sequence of steps performed without any human interference (once configured)
How RPA Works to Grow Efficiency and Accuracy
Let’s take an example from banking. Every day Front- and Back-office teams upload their reports to their portals. These reports need to be reconciled every day. Before automation, people would manually download these reports to work on the reconciliations.
Because of the large volumes typically involved, it would invariably both take up a lot of time and have errors and inaccuracies. The process would need 5 Full Time Employees (FTEs) while process efficiency would be 40%.
Now by automating this process, efficiency can be increased to 80% since RPA reduces errors, time, manual effort and increases accuracy and reliability. Using automation, it would take only 1 FTE, so that 4 FTEs can be redeployed to value added tasks, thereby saving project costs.
Increased Efficiency: Software robots can complete tasks about five times faster. They can work 24 hours a day, 7 days a week and 365 days a year. Robots do not take breaks!
Most organizations extracting data from scanned documents, emails, images, PDFs, and even hand written documents struggle with the different types of document templates involved. Cognitive RPA solves this problem. It uses Artificial Intelligence (AI) technologies such as Computer vision, Natural language processing, Fuzzy logic to handle structured or unstructured data, and Machine Learning to automatically classify, extract and validate information and improves the experience for your workforce and customers.
Enhanced Accuracy: Accuracy is dramatically improved with RPA software as it is programmed to follow rules, thus avoiding manmade errors in the process.
Increased Employee Engagement: RPA increases employee engagement and motivation, a key priority for most businesses today, by enabling them to focus on more fulfilling and higher value added work with the simple repetitive tasks done by the bots.
Greater Scalability: As your enterprise grows, you can scale up the power of Robotic Automation to match your changing needs. RPA solutions allow the flexibility to choose software adaptable to your assessed needs. Scalable RPA software boosts productivity and revamps legacy business processes.
Increased Security: Security is the main requirement of all organizations. Bots understand normal usage patterns through monitoring. They then apply this capability to detect or minimize the consequences of malware and other forms of attacks especially when equipped with machine learning. Data access is well controlled and documented with RPA.
According to the Gartner report, between 2019 and 2020, the number of RPA projects deployed at federal agencies increased from 219 to 460, a 110% gain. And the benefits are even more impressive. In 2020, in aggregate, RPA saved 848,336 annualized hours.
Robotic Process Automation (RPA) software revenue will be nearly $1.9 billion in 2021, a 20% increase from 2020. RPA market will increase at double-digit rates through 2024.
The growth rates are understandable. You’d want to use RPA to increase productivity, eliminate errors, and cut costs in your business today too !
RPA ROI (Return on Investment)
RPA done correctly delivers high ROI. The average ROI achieved by businesses, according to Automation Anywhere is, is 250%, typically paid back within six to nine months after deployment.
Measuring the cost
- RPA solution: Licensing, subscription, maintenance, etc.,
- Extra infrastructure: Hardware, software, and networking infrastructure required
- Development: Cost of development tools, time of developers, business analysts, and users to analyze, redesign, and automate the process.
- Maintenance: Monitor and maintain the RPA software
Conclusion
RPA can work as a gateway to broader-scoped automation in the business organization with lower cost and near-zero risk. RPA both minimizes errors and improves efficiency. RPA systems are being welcomed by organizations eager to increase productivity, cut costs, and gain a competitive edge. Undoubtedly, every business across the world will benefit from an automation system in the future. In fact, they already are!
With RPA, companies are:
- Processing extremely high volumes of unstructured as well as structured data
- Increasing worker productivity
- Enhancing operational efficiency
- Reducing costs
- Moving employees to higher value, more strategic work