Technology

Why robotic process automation is becoming the next competitive edge

2021 Macquarie Technology Summit related insight


 

23 June 2021

Corporate interest in robotic process automation (RPA), the software that emulates and automates repetitive human tasks, has not yet been matched by the level of adoption, which varies by sector, industry and the size of organisations, but it’s accelerating rapidly.

As RPA combines with machine learning and artificial intelligence (AI), it will create a digital workforce that relieves knowledge workers of time-consuming and routine tasks, argues Ben Sturrock, Vice President, Software & Services at Macquarie Capital.

Sturrock believes the streamlining potential of this combination of technologies will let organisations unleash more of the creative and intellectual capacity of their employees, allowing them to focus on the complex, higher value aspects of their work. In doing so, it could open up a new source of competitive advantage amongst those who choose to adopt it.

Vijay Khanna, Chief Corporate Development Officer at UiPath, the world’s largest RPA vendor and a Macquarie Capital client, states: “We believe that human talent is key for innovation, and our goal is to remove mundane and repetitive work and enable people to focus on creative tasks and business processes that require cognitive thinking. Our unique combination of UI Automation, API Management, and AI is designed to emulate human workers and help organisations assign all automatable work to robots enterprise-wide.”

“Organisations now have the potential to free up these great minds they have working for them so they can be engaged in knowledge-based tasks that have much more value,” Sturrock says. “In the next few years, we will see the digital transformation of the knowledge worker. The companies that do it best will be the ones who dominate the next phase of technological disruption.”

“We’ve moved beyond the early stages of RPA. The field is exploding and as this happens, RPA can no longer be seen in isolation. Instead, AI, machine learning and intelligent business process management (BPM) software are all operating together and should now be seen as one automation suite.”

Neha Mishra,
Senior Vice President, Software & Services, Macquarie Capital 

A convergence of technologies

RPA, which first emerged in the early 2000s, uses computer software known as bots to execute business processes in place of humans. It has already been employed extensively in sectors such as financial services, insurance, manufacturing and logistics to perform tasks such as data extraction and inputting, application processing and even customer service. In doing so, RPA has helped cut operational costs, reduce business interruption and improve accuracy and corporate compliance.

However, Neha Mishra, Senior Vice President in Macquarie Capital Software & Services group, argues that, as RPA becomes more influenced by other technologies such as AI and machine learning, it can now be used in an even more ambitious and potentially ground-breaking way.

“We’ve moved beyond the early stages of RPA. The field is exploding and as this happens, RPA can no longer be seen in isolation. Instead, AI, machine learning and intelligent business process management (BPM) software are all operating together and should now be seen as one automation suite.”

Mishra adds that it’s not simply about cutting costs anymore in utilising this technology. It’s essential for businesses to stay competitive in a fast-paced marketplace where everything is increasingly digital and fast-paced.

The rise of employee developers

UiPath is taking the lead on the convergence of RPA, AI and machine learning.1 The company began by building SDKs used by developers to automate their processes. During this time, they perfected their Computer Vision technology, which today is at the core of the platform. It was this technology that led it to develop software robots with the ability to view a computer’s desktop and make sense of the various applications, windows, and user interface features. This allowed it to adjust dynamically to any changes in the automation workflow.

With other players, including Microsoft, also now entering the automation space, UiPath remains focused on delivering holistic automation for knowledge workers and enabling the fully automated enterprise. Central to this is its robust ‘low code’ or ‘no code’ platform, which allows non-developers to create their own bots using a low-code drag-and-drop interface.

Sturrock says that UiPath’s impact is being felt across organisations and that there is a collegiality developing among its users, many of whom are helping each other eliminate the more mundane elements of their jobs through automation. With more than 1.5 million members and growing, UiPath notes that it has the largest automation community in the world, connecting customers, partners, freelancers, enthusiasts and beginners to UiPath.

“UiPath is not open source, but you have a lot of users from different organisations willing to share their experiences on how they’ve automated different tasks and how others can easily do it too.”

A new wave of creativity

Low code and no code are becoming hot topics. Tech companies talked about them 974 per cent more frequently in 2020 than in 2019, according to Macquarie Research estimates. Mishra argues that those companies who best employ low code and no code platforms, like what is made possible by UiPath Apps, will improve their processes, reduce costs and solve both internal and customer problems more rapidly.

By empowering their employees to spend more time on strategic and higher-value work, they will also potentially unleash a new wave of creativity. This could give them the opportunity to develop new products and services and generate revenue in different ways.

“Low and no-code platforms put the power in citizen developers’ (i.e. non-coders) hands, helping companies automate bespoke processes, resulting in significant productivity improvements and the ability to respond to customers more rapidly,” Mishra explains.

“The first impact will be in the role of junior knowledge workers. You won’t have analysts spending all their time compiling detailed research reports and junior lawyers will be liberated from the discovery or due diligence room.”

Ben Sturrock,
Vice President, Software & Services, Macquarie Capital

The future of knowledge work, rewritten

When taken together, these trends have the potential to change both career trajectories and the nature of day-to-day intellectual work. IDC forecasts that, by 2024, 45 per cent of enterprise employees will be involved in automating parts of their own jobs.

It is also likely to displace some roles, particularly lower-level professional roles that often involve a high proportion of administrative work. However, a 2017 McKinsey study found that ‘even with automation, the demand for work and workers could increase as economies grow, partly fuelled by the productivity growth enabled by technological progress’.2

Sturrock agrees that knowledge workers are likely to see more benefits than disadvantages from the trend towards automation.

“The first impact will be in the role of junior knowledge workers,” Sturrock believes. “You won’t have analysts spending all their time compiling detailed research reports and junior lawyers will be liberated from the discovery or due diligence room.”

But Sturrock says that eventually, the change will flow right to the top, impacting the work that CEOs and managing directors perform. He also believes it will also cut across all professions, including the medical and health sector, education and professional services.

Mishra also points out that the work professionals engage in is likely to become more interesting and more fulfilling, leading to higher job satisfaction.

“Instead of manually completing mortgage paperwork that require considerable time, a worker can review data populated along with discrepancies identified by an AI powered bot, significantly improving productivity and satisfaction while delivering better value to clients.”

The sheer scale of this opportunity means that Macquarie Research estimates RPA market will grow from around $US2.0 billion in 2021 to $US6.9 billion by 2024, with increased commoditisation and low/no code technology reducing cost barriers and opening the field to smaller players, including SMEs. The result will be that some smaller enterprises may find they can build a robotic workforce and infrastructure to their much better resourced competitors, potentially opening the door for greater competition in areas such as professional and financial services.

“In fact, there isn’t a function in any enterprise – public, private or nonprofits – that cannot greatly benefit from software automation that makes people more productive,” Khanna states.

Mishra concludes, “Essentially, what this means is that every single knowledge worker will have their own personal intelligent bots on hand with the capability to carry out whatever mundane tasks they can delegate to them, driving future innovation."

 

  1. Information sourced by UiPath as at 22 June 2021.
  2. Jobs lost, jobs gained: Workforce transitions in a time of automation, McKinsey Global Institute, December 2017, https://www.mckinsey.com/.

Neha Mishra
Senior Vice President on the Software and Services team at Macquarie Capital based in San Francisco

Ben Sturrock
Vice President on the Software and Services team at Macquarie Capital based in San Francisco

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