Robotic Process Automation (RPA)

Robotic Process Automation (RPA) This article is an extract of the CH&Co.’s Fintank yearly publication. This article is an extract of our CH&Co. Fintank yearly publication on Innovation for Financial Services. The 2018 edition addresses ways for incumbents to collaborate with Fintechs, Insurtechs and Regtechs through technologies driving the industry’s digital transformation. CH&Co. is a leading Swiss consulting firm focused exclusively on the Financial Services Industry. With 7 offices worldwide and 300 professionals, we proudly serve the industry’s major banks, insurance companies, wealth managers and investment funds. To read more please visit Fintank.net or Chappuishalder.com GENEVA · HONG KONG · LONDON · MONTREAL · NEW YORK · NIORT · PARIS · SINGAPORE Robotic Process Automation (RPA) With the proliferation of computer processing RPA = MORE BOTS THAN ROBOTS power, technology has reached a point where When we talk about robots in service industries, we it is now capable of performing human-like are essentially talking about bots.There are various tasks. Most people think of robots as physical names being used for robotics in service industries humanoids acting as humans and interacting such as Rapid Automation (RA), Autonomics, Robot- with humans, or big machines with steel arms ic Process Automation (RPA), Intelligent Process Au- making car parts (like in Toyota factories). Oth- tomation (IPA) and Artificial Intelligence (AI), but all er robots, less known to the general public, these terms essentially refer to the same concept: allowing organizations to automate tasks as though a are called “bots” which refer to non-physical real person was performing those tasks across appli- robots, such as software like “Chatbots” that cations and systems. Functional trained robots are are designed to simulate an intelligent conver- virtual workers and they execute rule-based informa- sation with one or more users via auditory or tion processes, improving accuracy and efficiency. textual methods. RPA in the Financial Services industry can extend the creative problem-solving capabilities and productivity of human beings and deliver superior business results. 2 RPA IN THE FINANCIAL SERVICES Interest over time robotic process automation RPA in the Financial Services industry can extend the creative problem-solving capabilities and productivity of human beings and deliver superior business results. Thanks to RPA, employees have the potential to attain new levels of process efficiency, as they leave the repetitive, time consuming and low value-adding tasks to robots, thus reducing operational costs and increasing speed, accuracy and throughput volume for the organization. Worldwide. Past 5 years. In addition to obvious cost savings, the benefits from Source: Google Trends implementing RPA include: Reduced operational risk with higher quality and lower error What many leaders currently regard as “automation” rates is most likely driven by core IT investments (i.e., the Time savings due to automation of repetitive tasks implementation of specialized enterprise apps such Scalability by improving standardization of process workflow as ERP, CRM or BPM); all of these can drive automa- Reduced friction (straight-through processing) tion — but not at the level that RPA can. New processes/products launched So, RPA refers to the use of computer software to con- New technologies explored but with non-intrusive trol and automate manual, rule-based, repetitive tasks integration by reducing reliance on multiple systems/screens to complete a process or processes without the need for human supervision: Improved customer experience Compared to traditional automation, RPA has low technology impacts with neither change in the existing Also worth noting, the amount of initial investment infrastructure nor complex integration needed to start benefiting from RPA is low, especial- Robots are able to mimic the human actions at the software ly when compared to IT integration or outsourcing presentation layer, also known as the graphical user interface strategies. Investment in RPA usually has a short (GUI), and interacting with multiple applications, just as a payback period since it costs approximately only person would and can follow instructions $20k to build a robot (with the assumption that an RPA robots can be fully audited, recording all the changes average project would require a 4-man-week effort at and accesses a daily rate of $1,000, and this excludes any running Robots can free up the employees for value-added cognitive processes in departments, can collect knowledge that can be costs such as licenses for maintenance, server costs built up and extended to other new robots and any virtual desktop costs). In addition, RPA is quick to implement and in some instances, the development of a robot can be done in as little as just a few hours. 3 RPA IS NOT ONLY ABOUT CHOOSING TECHNOLOGY RPA is more of a process and change project than a technology alone. Automating an inefficient or poorly controlled process only amplifies the issue. Sample key performance indicators / metrics Description A Process Quality • Measure the elimination percentage of human error when performed by bots compared to the tasks performed by the FTEs • Reduction in operational risk arising due to human error B Performance • Measure the amount of work performed and time consumed by the bots as compared to the FTEs • Enhancement of operational efficiency • % of reduction of errors • # of reductions in manual steps • % of process steps automated • % amount of time (cumulative time by entire team) saved C Availability / Reliability Effectiveness of RPA • Measure the reliability of the bots in terms of complying to the agreed service levels and timely availability of the bots = A Process Quality x 4 B • Number of exceptions handled with human intervention for the in-scope tasks Performance x C Availability HOW IS RPA BEING USED BY FINANCIAL INSTITUTIONS? In India, ICICI, the country’s largest private lender, BNY Mellon has a dedicated RPA team using Blue was the first in the country to deploy robotics. The Prism® to program bots with rules that let them bank has re-engineered 200 business processes with perform research on orders, resolve discrepancies software robots that are configured to capture and and clear trades. It takes a human 5 to 10 minutes to interpret information from systems, recognize pat- reconcile a failed trade. A bot can do it in a quarter of terns and run business processes across multiple ap- a second. In addition to faster speed, bots can work at plications to execute activities including data entry night, saving employees from having to work night and validation, automated formatting, multi-format shifts. They can handle overflow when a stream of message creation, text mining, workflow acceler- work outpaces the available staffing. ation, reconciliations and currency exchange rate processing among others. A European insurance group processes automobile insurance applications that are delivered as 4-page documents featuring 60 parameters. These forms had to be manually entered into the Back Office systems. Thanks to an RPA project, the average handling time was reduced by 40%. SAMPLE USE-CASES FOR RPA IN BANKING Finance & Accounting Regulatory & Compliance Financial Risk Management Record to Report (GL): Personal Account Dealing: Credit Limit Management: • Record journal entries • Periodic disclosure of attestations with changes • Perform GL account reconciliations • Perform margining calculations and identify causes behind margin deficits • Record intercompany transactions • Review of account openings with paper statements • Maintain accounting master data • Paper trade entry • Paper statement upload to accounts Travel & Expenses: • Audit expense reports • Recommend remediation based on analysis Data Quality: • Execute timelines, accuracy, and comprehensive checks, and initiate remediation actions where required • Transfer disclosures KYC: Fixed Asset Accounting: • Collection of client information • Calculate asset depreciation • Risk scoring / due diligence level information • Account set-up Licensing and Registration: • Data entry and validation for U4 Form and other jurisdiction forms • Transfer amendments 5 Risk Reporting: • Aggregate and segment data for standard reports (e.g. Top 50 Counterparties Report) OVERVIEW OF THE RPA LANDSCAPE Below we present a non-exhaustive list of companies providing RPA solutions: Company Description • The global leader in Enterprise Robotic Process Automation • The company has added more than 60 large enterprises to its family of over 425 worldwide enterprise customers, including large financial institutions (the company also deployed over 800 bots at Australia’s largest bank) • Their new product, Bot Farm, allows companies to buy RPA tools on a usage basis rather than on a capacity or license basis • Gartner has recognized Blue Prism as one “Cool Vendor”, acknowledging their vision and leadership in world of Robotic Process Automation (RPA) • The have been featured in a number of articles in major publications about the disruptive technology of RPA and its potential impact • They have been making steady inroads in markets that include: Financial Services, Energy, Telco, BPO and Healthcare • • • • Founded in 2005 by Daniel Dines, UiPath has developed a rich set of Robotic Process Automation software products Their mission is to “eradicate tedious, redundant tasks” by using software robots to take on that work They focus on providing a robust set of capabilities for developing an “agile robotic workforce” Their products work within an industry standard enterprise architecture enabling them to be integrated within IT environments that comply with security requirements • Founded in 1998, IPsoft initially focused on the automation of the Data Center • With the development of Amelia, a robotic cognitive agent, IPsoft has expanded its reach into the automation of almost all of the typical enterprise processes • It strategic partnership with Accenture will extend its market presence beyond that of today’s impressive customer list • • • • Infosys Technologies Ltd. has been ranked by Forbes 19th among the top 100 most innovative companies So, it should not be surprising that in January of 2013 Infosys launched AssistEdge a call center automation tool that includes robotics Since its launch it has been successfully deployed in 350+ contact centers across 40 countries Finacle, Infosys’ banking solution from EdgeVerve Systems (owned by Infosys), offers FS • Provides end-to-end services to clients by evaluating, implementing, maintaining and operating automatic processes • They help their clients analyzing existing processes, designing and mapping the automatization of processes, developing the automation within their Autonomic Platform, and implementing the solution • Calling their services inSTREAM, its technology uses sophisticated algorithms, including artificial intelligence and cognitive learning to streamline labor intensive clerical tasks and decision making • Celaton works also in partnership with Genfour • As part of their solution, NICE allows organization automating back office services using Robotic Process Automation technology FINAL WORD Overall, we can anticipate that the adoption of roOver the past few years, businesses in North Ameri- botics in banking will be evolutionary. While its rap- ca and Europe have been seeking to reduce their op- id adoption is almost inevitable, leading firms will erating costs and increase their overall efficiency by use it as a way to not just reduce costs, but also to standardizing, centralizing and sometimes outsourc- improve controls and the effectiveness of their staff, ing a wide range of processes. Over time, more com- making them more productive and valuable within plex and sensitive processes became candidates for the organization. “industrialization”. RPA is the next step in the ability for companies to reduce costs while increasing accu- Even though RPA adoption comes with some inher- racy and control. The use of robotics also brings along ent challenges such as misplaced expectations and changes in the organization: the need to monitor ro- resistance from employee unions, it is emerging as bots (“Control Tower”), how to handle the Business a major game changer and will likely only gain in Continuity Plan, and how to repurpose jobs and re- popularity as more and more successful use-cases write job descriptions to fit these new roles. are published. 6 Acknowledgements & Contacts CH&Co. Digital Expertise Booklet Editorial Team We are deeply involved in growing the global FinTech community and Pierre Bustamante use our knowledge to enhance our public Fintank.net database. We Patrick Bucquet cofounded FinTech hubs, such as FinFusion in Montreal or Finance Edith Hitt Innovation in Paris, and regularly co-organize FinTech meetups in New Elodie Cohen York, Singapore, France, London and Geneva. The events unite leaders Megan Armitage from the Financial Services industry, startups and other innovators Julien Soulard featuring panel discussions, demos and insights from our FinTech Guillaume Rico experts that are among the world’s top influencers. Yannick Gaillard Sébastien Meunier AMERICAS EUROPE ASIA-PACIFIC DATA STRATEGY CIB: CIB & Retail: CIB & Retail: Stéphanie Baruk Charles Dally Stéphane Eyraud Laurent Liotard cdally@chappuishalder.com seyraud@chappuishalder.com lliotard@chappuishalder.com Sébastien Meunier Louis Forteguerre Guillaume Rico smeunier@chappuishalder.com lforteguerre@chappuishalder.com grico@chappuishalder.com Marc Lapostolle Jit Yew mlapostolle@chappuishalder.com jyew@chappuishalder.com Retail: Alexandre Hovette ahovette@chappuishalder.com Julien Soulard Insurance and Wealth: jsoulard@chappuishalder.com Sebastien Vorger ehitt@chappuishalder.com Insurance and Wealth: svorger@chappuishalder.com Insurance and Wealth: Pierre Bustamante Karen Yip pbustamante@chappuishalder.com kyip@chappuishalder.com pbucquet@chappuishalder.com Hélène Driancourt hdriancourt@chappuishalder.com Vincent Wiencek vwiencek@chappuishalder.com Edith Hitt Patrick Bucquet sbaruk@chappuishalder.com REG TECH Oliver Garcia ogarcia@chappuishalder.com Florent Palayret fpalayret@chappuishalder.com CH LAB Daniel Corrales Benoit Genest dcorrales@chappuishalder.com bgenest@chappuishalder.com Yannick Gaillard Patrick Seifert ygaillard@chappuishalder.com pseifert@chappuishalder.com Sylvain Hostetler shostetler@chappuishalder.com 7 Fintank.net Your FinTech Database THE INNOVATIONS THAT MATTER Our comprehensive database of company profiles covers a full range of financial services solutions from FinTech start-ups to large corporations. Each case study contains a thorough overview of the company’s solution, business plan and strategy. We also know that implementation is key and we strive to provide a repository that will help inspire the development of disruptive innovations by sharing insights on breakthrough ideas blossoming all over the world, including best practices and recent trends. FinTech Directory Want to invest in FinTechs? Fintank is the place to get an international list of start-ups in the Financial Services industry. CH&Co. Lab The CH&Co. Lab is an incubator that develops prototypes based on our best ideas and convictions. We develop solutions and share them with our clients, such as Highway-to-Mail. Innovation Booster CH&Co.’s methodology around crystalizing energies in corporate organization to foster innovation – inspired by start-ups’ approaches and business practices. FINTANK MULTISEARCH APP Available on © 2017 CH&Co. All rights reserved.