We are nearing the end of an outsourcing journey that many thought would last for a long time to come; the off-shoring of back office work to low cost countries. While it’s true that off-shoring initially provided many firms significant cost advantages over their competitors this advantage has been largely eroded because all the available labor arbitrage levers have now been pulled by so many industries.
What is next is Back Office Process Automation.
While many off-shore firms are racing to move their operations to secondary and tertiary cities trying to wring the last few cents from every process they automate, the reality is that Robotic Process Automation is quickly replacing the need to have scores of workers doing manual, rules-based tasks at all. Off-shoring is not going away over night but the trend to back office process automation is here to stay and will accelerate significantly as companies strive to improve productivity and quality while lowering the costs of work activities.
A real life example of how automation is replacing the need for human workers can be found at your local supermarket. Many of us can still remember when grocery clerks stood all day in front of an ‘automated’ cash register keying in the cost of each item purchased. While this was a huge improvement over the manual cash registers, the process was still less than perfect as clerks often keyed in the wrong amount – sometimes in favor of the consumer and sometimes not. As technology improved scanners were added to reduce the human errors but the process was still boring and highly repetitive. Now when you go to a supermarket many lanes are simply kiosks, which are operated by the consumer. Kiosks are able to operate because smart software engineers found ways to teach the computers a way not only to interface to multiple hardware devices but also to connect to sophisticated banking and back of house systems. Now with these systems in place the human component can be freed to tackle higher value work.
Advancements in digital technologies are not going to stop; they are going to accelerate. Innovative firms are already finding that many – if not most – of their rules-based work activities are strong candidates for Robotic Process Automation. As long as the underlying systems are available to the software robot, work that was once done with thousands of workers can now be automated and managed by a few humans. And, since one software robot can often replace as many as three to five humans the economics are jaw dropping. Lower errors/re-work, increased customer satisfaction, and improved regulatory compliance are additional benefits that can’t be ignored.
If you’d like to understand how Robotic Process Automation could be applied as a competitive differentiator in your firm we’d be happy to chat with you. Our firm, Virtual Operations, specializes in helping companies achieve their financial and operational goals through the implementation of automation technologies.
Let us see if we can help you!