Align costs with business strategy

Organize your future withrobotic process automation

The impact of Robotic Process Automation on a company’soperations and competitive positioning is significant on a number offronts: economic value, workforce advantages, quality and control
improvements, and flexible execution. In fact, a couple of RPA’s
greatest benefits are often overlooked: its ease of deployment and thespeed and agility it confers on the enterprise. But given the inevitabledisruption caused by RPA, business leaders should focus on a few
key implementation principles: automate as much as possible, focus
on frontend processes, maximize productivity, and aim for 100%
auditability. RPA can help companies organize themselves for thefuture. It is a foundation for machine learning, artificial intelligence
and a more autonomic enterprise.

45%

of work activities can be automated$2 trillion
savings in global workforce costs

Based on PwC estimates

By now many executives have heard theterm Robotic Process Automation (RPA).
Although sometimes misinterpreted dueto the absence of robots, RPA software
is a powerful tool to perform manual,time-consuming, rules-based office tasks
more efficiently by reducing cycle timeand at lower costs than other automation
solutions. PwC estimates that 45% ofwork activities can be automated, andthis automation would save $2 trillion in
global workforce costs.
Besides the cost and efficiency
advantages, a couple of RPA’s greatest
benefits are often overlooked: its ease of
deployment and the speed and agility
it confers on the enterprise. Until now,
most cost optimization and efficiency
improvement initiatives have reduced
costs through centralization andstandardization of processes. However,forcing all or most parts of an operation
into a standardized business process

over time reduces the organization’s
ability to react nimbly to changes andbusiness opportunities. This tradeoff
between cost, efficiency and businessagility presents a difficult choice forbusinesses.
Companies have tried to use Business
Process Management (BPM) andProcess Transformation to manage thesetradeoffs. But these solutions often
meet resistance during deployment andfail to achieve widespread adoption
across an enterprise. For example, while
BPM can streamline process flow andeliminate wait and downtime between
process steps, actual process execution
largely remains manual. As for Process
Transformation, companies often shy
away from the massive change and costs
necessary to redesign processes andjettison existing work methods.

The most overlooked beneﬁts of RPA
Ease of deployment
Enterprise speed
and agility
Organize your future with robotic process automation | 2

By comparison, RPA allows separatebusiness units within a company tocustomize solutions to rapidly digitize
processes, delivering significant andsustainable value in short timeframes
while reducing overall risks. Bybuilding and deploying these intelligent
operations at the business unit level,
managers can support repetitive
processes without conforming tocentralized standards for those
processes, thus achieving efficiencies
and cost savings while preserving
flexibility. These types of processes
are especially common in finance andaccounting, HR administration andclaims processing but can also be foundembedded in several different functionalparts of the organization.
For example, a high growth technology
company located in California with $2
billion in revenues recently conducted
an RPA Proof of Concept (POC) as partof a finance and accounting processtransformation. The company selecteda variety of front office and back officeprocesses with varying degrees of

RPA complexities to test. The resultsof the POC illustrated reduced costs(10% - 15% based on the process),
improved controls (100% auditability),
compressed cycle time (saving 3,000hours) and the ability to realign talent
to focus on value-added activities.
Encouraged by these results, thecompany is preparing to expand the useof RPA across the broader organization.
On an even larger scale, consider
the experience of a top 5 U.S. bank.
Executives there had aggressively
pursued outsourcing and offshoring tolower costs for years but realized thatthose avenues were tapped out. In theirsearch to implement the next stage ofbusiness process improvements, theydecided to investigate RPA. Specifically,
the bank commissioned a POC
around digitizing its loan processing
functions. The results were dramatic:
an opportunity to compress activities
by 60% and reduce headcount by 30%.
As a result, the bank established aroadmap to implement RPA across loan
processing functions.

Organize your future with robotic process automation | 3

The Power of Automation

growth with speed, agility, and resiliency.
Meanwhile, traditional workers can shiftattention to higher value, more strategictasks, and other business development
activities.

Economic Value

Quality and control improvements. RPA
digitizes expensive and error prone
manual processes. Every step in theprocess, every activity performed, andall sources of data have a digital audit
trail. By carefully planning a company’scontrol processes, a company can embedthresholds and guidelines into theautomated processes, expediting testing
and risk compliance. This reduces errors,improves quality and compliance, andcan also improve customer satisfaction
through reduced queries, and complaints.

Workforce Advantage
Quality and Control Improvements
Flexible Execution

As these company examples show, theimpact of RPA’s capabilities on a company’s
operations and competitive positioning aresignificant and can be felt on a number offronts.
Economic value. RPA can reduce
operational costs and attain ROI goals
faster than a traditional enterprise
resource planning (ERP) deployment.
There are two major reasons for this.
First, RPA-inspired process automation islocalized to a business unit or function,
which means the solution can be deployedfaster and more precisely. Second, RPA
does not require navigating throughcomplicated systems integrations orrequire higher level programming. It
works through the user interface andavoids traditional process integration,such as IT resource investment, business
requirements documents, and significant
development time. Reduced integrationneeds and implementation times lower
costs and create faster ROI.
Workforce advantages. Companies canshift from a labor centric operating modelto a technology enabled operating model,
and be less constrained by labor costs,labor supply and local labor legislation.
A digital workforce is capable of working
24x7 and requires limited to no oversight,
and can scale in response to business

Flexible execution. Unlike traditional
ERP initiatives or process transformation
initiatives, which are usually large scale
and measure success in years, RPA
initiatives can be deployed on a variety ofscales. Some small scale deployments canrealize benefits within a few weeks while
benefits from larger scale transformations
may take 6 to 12 months. In otherwords, companies have the flexibility toexperiment with RPA or to fully commit
based on the depth of transformation theywant to pursue.
A digital workforce is capable ofworking 24x7

Organize your future with robotic process automation | 4

Organizations will also need to define
and address RPA ownership. Indeed,
the role of the Global Process Owner(GPO) is critical.1 They are put in chargeof determining how to make a process
efficient and error free. Under mostcircumstances, business units should own
the automation of tasks for which they are
responsible in order to give them agility.
However, the business units should workwith the CTO’s office to consider theimpact of this change on the organization’s
IT strategy and roadmap, as well as thechanging role of IT.

Managing Through Disruption

RPA deployment also means that moreof the company’s transactional work
currently outsourced to third-parties
can come back in-house or remain
in-house, allowing companies to maintainownership of their processes and controls.
As a result, businesses will need toreevaluate their vendor management
organization and outsourcing contracts
to ensure they are still relevant andbeneficial.

Redeﬁne Workforce Roles
Reorganize Structure
Review Sourcing Relationships
Enable Cross-Functional Collaboration

Any company that chooses to embrace
this disruptive technology and theopportunities it promises must be
prepared to manage the significant
technological and cultural challenges thatwill ensue.

By automating processes, organizations
can refocus, redeploy and/or reduce theworkforce. However, senior leaders willneed to allay fears that employees may
have about their future roles by explaining
the shift in focus to tasks that are higher invalue, including innovation, analytics andmanagement of source data.

Business units that may not have typicallycollaborated in the past will have anopportunity with RPA to share crossfunctional processes with one another.
Ideally, this will open opportunities togain cross functional process efficiencies
and lead to greater cost reduction. But toensure participation of all business units,
senior leaders will need to make clear thatcollaboration is a priority for the company.

1 Help your GPO succeed: Benefits, innovation, andchange arising from the role, Thomas Torlone, U.S.
Leader of Enterprise Business Services at PwC, 2016
URL: https://www.linkedin.com/pulse/help-yourgpo-succeed-benefits-innovation-change-arisingtorlone?published=t

Organize your future with robotic process automation | 5

Getting the Most Out of Automation
Implementation of RPA usually begins with a Proof of Concept. End-to-end POC takes
approximately one to two weeks to complete (see Figure 1).

Figure 1: Proof of Concept

Phase

POC Selection

Activities

Process
Re-engineering

Programmingand Testing• Determine Complexity• Interview Process• Install RPA Software• Confirm SME AvailabilityStakeholders• Evaluate Process
Efficiency• Develop Automation• Estimate Value Impact

Solution

Level of Effort

1– 2 Days

2– 3 Days

5 – 7 Days

Stakeholders
Involved

Business SME/
RPA COE

Business SME/
RPA COERPA COE

SMEs - Subject Matter Experts

COE - Center of Excellence

Once that is complete, business leaders undertaking an RPA deployment should focus ona few key principles to maximize value from the initiative.
Automate as much as possible. Evaluate current processes with an end-to-end, crossfunctional lens and maximize automation across processes.
Focus on frontend processes. Maximize the use of automation during initial steps of aprocess and work in coordination with other departments or functions because upstream
process improvements have a magnified impact on downstream steps.
Maximize productivity. Evaluate process dependencies between the traditional anddigital workforce and schedule RPA solutions intelligently to optimize uptime while notoverwhelming production systems.
Aim for 100% auditability. Consider applying automation to processes to create acomplete digital trail and improve controls for tasks that are otherwise too labor intensive
to fully audit.

Organize your future with robotic process automation | 6

Moving toward Artificial Intelligence (AI)
Although RPA is still a relatively new application, early adoption by leading companies
shows that by redefining work processes and reassigning employees to higher value
activities, by reducing cost and human errors, and by increasing compliance andefficiency, RPA can take companies to the next level of productivity optimization.
As companies increase the scale of automation within the enterprise, they will steadily
improve their automation algorithms and continue to see new applications for RPA tocreate sustainable and long-term transformational change and competitive advantage.
In other words, RPA can help these companies organize themselves for the future. It’s
the next step toward cognitive computing, artificial intelligence and a more autonomic
enterprise.

Organize your future with robotic process automation | 7

Authors
Thomas Torlone
U.S. Leader of EnterpriseBusiness Services, PwC
thomas.torlone@pwc.com+1 (513) 349 6122

Rodger HowellPrincipal, PwC’s Strategy&rodger.howell@pwc.com+1 (708) 267-0590

Fanny Ip
Director, PwC
fanny.ip@pwc.com+1 (805) 208-7881

Anuj Mahajan
Manager, PwC
anuj.mahajan@pwc.com+1 (512) 529-5204© 2016 PwC. All rights reserved. PwC refers to the US member firm or one of its subsidiaries or affiliates, and may sometimes refer to the PwC network. Each member firm
is a separate legal entity. Please see www.pwc.com/structure for further details. 169037-2016