The Long Tail of Robotic Process Automation
How to scale Robotic Process Automation or RPA meaningfully within an enterprise? This is the billion dollar question on the minds of venture capitalists, RPA software vendors, service providers and enterprises alike.
In the 2006 book The Long Tail, author Chris Anderson presented a (then) novel business concept – that the future of business is selling less of more.
This business model quickly gained popularity among retailers, particularly e-Commerce retailers. For example, Amazon, which began life as an online book retailer, offers tens of millions of book titles on its website, many of them obscure ones. By comparison, a typical book superstore (where they still exist!) carry around 100,000 titles.
This concept has been successfully applied in other industries too. In digital marketing, marketers frequently talk about long-tail keywords as part of their Search Engine Optimization (SEO) strategy.
And in 2011, Forrester Research, in a paper commissioned by Blue Prism, introduced the concept of the long-tail of IT requirements. The key finding is that more than half of enterprise automation opportunities go unsupported, often due to factors such as lack of IT resources and rapid pace of change in business.
Their key recommendation? IT to help facilitate business functions to self-fulfil their automation requirements through the use of highly accessible technologies like RPA. Business users are empowered to configure and deploy their own software robots (which mimic human behaviours) to perform mundane, repetitive tasks. Typically, these software robots interact with a multitude of enterprise applications at the Presentation or User Interface (UI) layer, where business users are most familiar with and/or proficient in.
Focusing on the long-tail of automation rather than the high volume, repetitive tasks goes somewhat against the grain. After all, focusing on the latter, especially in an outsourcing or shared services environment, can yield tremendous Return on Investment (ROI) in a short period of time. This partly explains why a lot of the early adopters of RPA are service organizations like banks and telcos with sizable back office operations.
There is just one chink in the armour though. These are not your typical organizations. Anecdotal evidence seems to suggest that many RPA implementations fail to scale meaningfully beyond the initial pilot.
This should not come as a surprise.
After all, according to the McKinsey report Harnessing automation for a future that works, less than 5 percent of all jobs can be completely automated using currently available technologies. The corollary is that the promised land of cost take-out and FTE elimination/reduction might not be easily attainable (or even realistic).
On the flip side, for approximately 60 percent of all jobs, at least 30 percent of their constituent activities can be automated. This is, in fact, the long-tail of automation, and the sweet spot where company executives with a long-term orientation should focus their automation strategies on. By returning hours back to their businesses, employees can now focus on the work that truly matters, be it unrelenting customer focus, bottom-up innovation, real value creation, etc.
Attended or Unattended Automation
So how would the long-tail of RPA look like?
Well, attended robots will rapidly gain prevalence over unattended ones. For the uninitiated, the following provides a quick comparison between attended bots (otherwise known as Robotic Desktop Automation) and unattended bots (RPA):
In fact, the RPA industry itself is already pivoting towards the long-tail. As Guy Kirkwood, Chief Evangelist at UiPath highlighted, the ratio of unattended to attended robots was 70:30 in 2017. In a short span of a year, the ratio is now 54:46. The trend is undoubtedly towards the use of automation to augment the human workforce (i.e. attended bots) rather than to displace them (i.e. unattended bots).
The math is actually very simple. Eliminating just 5 minutes of tedium across thousands of employees across the organization is much more valuable (and liberating) than a few isolated cases of FTE savings. And is much easier to scale too!
The Democratization of Robotic Process Automation
As the industry strives to empower “automation for the masses” (or what some referred to as the democratization of RPA), 3 critical factors to eliminating friction to RPA adoption will emerge: price, convenience and education.
Price will be the main battleground as RPA software vendors enter a race to the bottom. There are many good reasons for this: more competitors (including established, well-funded ones) entering the fray, shifting of focus towards capturing a small slice of a big pie rather than a big slice of a small pie (as is status quo), ensuring the commercial viability of most long-tail RPA opportunities (where meaningful volume is absent), etc. At the minimum, it is likely that the common practice of charging annual software subscription will be replaced by the more palatable option of perpetual licensing.
On the convenience front, RPA software will become increasingly integrated into the greater software ecosystem. We are already seeing this being played out with the recent announcement of the acquisition of Contextor by SAP. The Holy Grail is surely the bundling of the RPA software into each and every computer’s operating system in the same ubiquitous manner as the Microsoft Office suite, thus heralding the age of “one robot for every user”.
The final piece is the race to win the hearts and minds of end users in a world where network effects often result in a “winner takes most” outcome. Education is the key here, for in spite of the best efforts of marketeers to position RPA as a low code or no code software, the reality is that any meaningful automations usually require some technical dexterity on the part of users. Hence, it is important to get the students of today acquainted with RPA software and perhaps more crucially, to encourage them to adopt an “automation-first” mindset. Get this right, and the rest will take care of itself.
Day 1 for Robotic Process Automation
To rephrase Jeff Bezos, this is Day 1 for RPA. There is definitely going to be lots of growing pains as the industry collectively matures. But make no mistake, the opportunities and risks ahead of us are even greater than those behind us. Who dares wins.
Do you agree with our views on the long tail of Robotic Process Automation? Do drop us a comment below.
For more insights and to keep up to date on the latest in Robotic Process Automation and Artificial Intelligence, you can subscribe to our mailing list on the right. Also, follow us on LinkedIn or like us on Facebook to follow our latest blog posts. Lastly, feel free to drop us your comments in the comment box below. We would love dearly to hear from you.