How much did you spend on automation software this year?
BUSINESSES have been discussing the need to invest in robotic process automation (RPA) for quite a while now — evaluating the advantages in terms of cost savings and efficiency improvements.
So far, most companies see RPA as a solution that can make their executives more productive, rather than a tool that can eliminate a number of jobs.
One of the biggest draws of RPA software is that besides being easy to deploy, it doesn’t require a significant investment in the first place.
According to Gartner, global spending on RPA software is estimated to reach US$680 million this year. Although not a huge figure (given the low costs), it is already a 57 percent increase over the previous year’s figure (indicating that more companies are willing to give RPAs a shot).
In fact, Gartner believes RPA software spending is on pace to meet the US$2.4 billion spending goal by 2022.
The biggest adopters of RPA today include banks, insurance companies, utilities, and telecommunications companies.
Typically, organizations in these industries struggle to knit together the different elements of their accounting and HR systems, and turn to RPA solutions to automate an existing manual task or process, or the functionality of legacy systems.
According to Deloitte, RPAs can help improve productivity and reduce costs. At a Fortune 1000 bank they worked with, for example, 150 bots help execute 120,000 operational requests per week, which helps increase throughput in lending and retail banking.
The bank expects to save US$40 million in the first three years as a result — as it only spent 30 percent of what it would have to spend had it hired additional staff to process the 120,000 requests.
“End-user organizations adopt RPA technology as a quick and easy fix to automate manual tasks. Some employees will continue to execute mundane tasks that require them to cut, paste and change data manually. But when RPA tools perform those activities, the error-margin shrinks and data quality increases,” said Gartner VP Cathy Tornbohm.
Gartner estimates that 60 percent of organizations with a revenue of more than US$1 billion will have deployed RPA tools by the end of the year.
By the end of 2022, 85 percent of large and very large organizations will have deployed some form of RPA.
“The growth in adoption will be driven by average RPA prices decreasing by approximately 10 percent to 15 percent by 2019, but also because organizations expect to achieve better business outcomes with the technology, such as reduced costs, increased accuracy and improved compliance,” explained Tornbohm.
However, RPA is not a one-size-fits-all technology and there are cases where alternative automation solutions achieve better results.
According to experts, RPA solutions perform best when an organization needs structured data to automate existing tasks or processes, add automated functionality to legacy systems, and link to external systems that can’t be connected through other IT options.