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For Mid-Market Clients, RPA Is About Generating Revenue, Not Managing Costs

The cost savings that RPA can generate, whether through increased efficiency or a smaller workforce, have compelled many corporate implementations, but some clients may be focusing on the wrong benefits.

richard mackey
Richard Mackey, SVP of Information Technology at Intalere

“Frankly, in the mid-market tier, companies don’t have the scale that warrants the usual cost-saving proof of concepts that Fortune 500 companies are performing, so they should be using automation for its revenue-generating opportunities,” said Richard Mackey, SVP of Information Technology at Intalere, a healthcare supply chain management company.

As an adopter of RPA, Mackey argues that companies this size don’t have the same critical mass as the larger players, meaning that the resulting cost savings would be minimal. Instead, they should adopt automation as a means to boost income, a goal that Intalere has successfully achieved.

Process Improvement by the Numbers

The company is a client of Auxis, a BPO provider that supplied the bots to handle different revenue-generating activities, such as analyzing if customers can be upgraded to higher-level contracts based on how they interact with distributor websites.

After implementing the bots, Intalere found them to be more accurate and faster, resulting in a 50% improvement in cycle times, which were often delayed because human workers found the tasks to be mundane compared to their core analytical work. There has also been a 30% improvement in the quality of data, with the bots negating human errors like typos and copy-paste fumbles.

“This means more revenue for us, since the more studies we can complete, the higher the number of customers we have spending on our contracts,” said Mackey.

The company’s core employees are now focusing on tasks that require more human judgement, such as detailing descriptions on contracts, dealing with customers in direct interactions, performing sales, or measuring the eligibility of new customers, for example.

And the resource cost of time and money was not what they expected.

“The implementation of an RPA solution isn’t as long or expensive as first thought, which also opens it up for more middle-market enterprises to dive in and generate revenue,” said Mackey. “There is relatively low risk and the market knows that these types of back-office projects are doable, so even if you argue that it’s about getting people inside your organisation comfortable with it, you can move the needle faster by focusing on the profits that can be made.”

Preparing the Team for RPA

In the case of Intalere, the company’s analysts were already highly skilled, so they welcomed automation with open arms. But not every company would have the same experience, meaning additional cost in training or hiring new talent.

Eric Liebross
Eric Liebross, Senior Vice President at Auxis

When asked about this, Eric Liebross, Senior Vice President at Auxis, was unconvinced that the level of up-skilling being communicated in the industry was actually occurring.

“RPA changes peoples’ roles, because the transactional, manual, rules-based activities — while not necessarily completely eliminated — are taken over by the automation,” he said. “It requires companies to change the role of the person who is left behind, or hire for a new role altogether.”

In the company’s Costa Rica facility, Liebross explained that roles have been changed by having people take on different tasks, or performing more tasks that they didn’t have time for pre-automation.

Invoice processing is a good example, as it involves a lot of manual data entry tasks that a robot can handle, so the retained person focuses on handling exceptions and issues that the robot is not designed to resolve.

“This makes them more of a specialist in exception handling,” said Liebross. “Their job becomes more about supporting the vendor inquiry process and related internal processes to ensure higher quality and timeliness. RPA gives them a chance to take a more proactive role in resolving issues that prevent the process from being completed. ”

Shifting Skills and Change Management

In order for employees to step up to these new responsibilities, they need to be proactive workers who have a combination of communication skills, attentiveness, and prior knowledge, which means not everybody is suited to such higher-value tasks.

“A lot of people are more effective at straight transactional work, so when the job changes they may not be suited to the new role,” said Liebross. “We’ve seen the fallout of that; sometimes it has worked really well, but other times the person may not have been the best fit.”

In some cases, Liebross has seen companies open up new roles in areas they want to invest more in, such as data analytics or variance analysis. In these cases, a transactional worker is not the right person for the job, so the company can either invest resources into training, or find a suitable replacement.

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“The number-one challenge that companies have with RPA is exactly this situation: the realignment and restructuring of roles in the organization to address the changes that take place,” he said. “You can’t always take a person out of one role and plug them into another – it doesn’t work like that. You have to evaluate what role a person is capable of moving into on an individual basis.”

Planning Ahead is Key

The resource burden of training existing employees for new roles is far greater than most companies understand, and, now that RPA is gaining momentum, this reality needs to be communicated by automation providers.

Clients must also plan for this way ahead of implementation: Will the software displace workers? How many? What roles could they move into? How will we train for those new roles? These are vital questions to ask before adopting RPA.

Identify what the true impact will be, including cycle time or task redistribution, and understand what will change ahead of time. Evaluate your team for people who can work with the software or take on more operational roles, then single out the strong players that need to be retained and plan for where they will be transitioned.

In the end, as the cycle of automation adoption continues, the companies that understand the best way the technology can work for them and plan ahead to get the most out of the technology will be the long-term winners.

Matt Kendall

During his 2+ years as Chief Editor at Nearshore Americas, Matt Kendall operated at the heart of both the Nearshore BPO and IT services industries, reporting on the most impactful stories and trends in the sector.

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