- Now that we've gotten a good handle
on the definition of RPA,
let's dive into what makes it so exciting
for businesses today.
To put it simply,
the return on investment, or ROI,
for automation projects
has the potential to be significant.
While I've seen a lot of hyped and inflated expectations,
and frankly, some crazy ROI claims,
the fact still remains.
Handling tasks using digital labor can make a lot of sense,
and save a lot of dollars and cents.
What's more, chances are very good
that your executive leadership is already aware of this.
Recently, I've been fascinated
by what I'm calling the top-down mandate.
This is a situation where CEOs, CFOs,
or others from the C-suite
are beginning to set automation goals
for the organization.
Big, bold goals that effectively say,
"We must save X,
"and we will achieve this thanks to process automation."
For example, in May of 2017,
Wells Fargo, the huge US bank,
publicly announced a goal to reduce annual expenses
by $2 billion by the end of 2019.
In the analyst day presentation,
the CEO stated that this savings
would partially be as a direct result of using,
quote-unquote, digital technology
to automate manual processes.
In similar fashion,
the CEO of the large European bank Deutsche Bank
stated a mandate to bring down their cost of revenue ratio
from 86% down to 65% by 2020,
in part by cutting 15,000 jobs through,
you guessed it, automation.
The list goes on.
CEOs of Nordea Bank, Lloyds Banking Group,
Zurich Insurance Group, and numerous others
have declared bold cost savings mandates
for their organizations
that are predicated on automation.
It's no wonder RPA is a popular topic,
and if you think this sort of strategy
is relegated to banking and financial services,
think again.
Healthcare, manufacturing, logistics, entertainment,
pick any industry.
A CEO is likely declaring automation-oriented mandates in it
so they can survive under increasing operational pressures.
So, if you find yourself the recipient
of such a top-down mandate,
the first thing you'll need is a plan
backed up by a solid business case.
As you saw from the examples I just cited,
the business case will often be heavily oriented
to headcount reduction,
because tallying headcount is a quick way
to get to solid estimates of benefits,
or what we call cashable benefits.
However, I mentioned,
I'm an optimist about the impact of automation on jobs.
It's because I actually rarely see headcount removal
as a result of RPA.
Instead, forward-thinking businesses
are considering how best to reallocate
and repurpose their qualified staff
to perform higher value-adding tasks.
You may hear this referred to as hours back to the business.
The actual benefit equation is far more interesting,
as there are many more nuanced ways that RPA adds value.
You'll wanna know the numerous types of benefits
you should look for if you plan to make a case for RPA.