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RPA Doesn’t Begin with FTE-Based Assumptions (Part One of Two)

Alsbridge Managing Director Bill Huber recently interviewed Sean Tinney, Global Head of Innovation and Transformation at Sutherland Global Services, to discuss the current state of the Robotic Process Automation (RPA) market and to examine where the technology is headed.

Bill Huber: Tell me about your background and current responsibilities.

Sean Tinney: I have been in the BPO space for 13 years. My career began with a focus on O2C, transitioned into management, then account responsibilities. My current role is running innovation and transformation from a delivery perspective at Sutherland Global Services. I work with the Platform Development team — beginning at the pilot phase, determining what works best as a point solution and what the appropriate scale should be. Our focus is bringing innovation and scalability to our customer solutions.

BH: What does RPA mean to you?

ST: That’s the million dollar question. There are multiple definitions out there. To me, RPA is another way to have a virtual workforce handling transaction-based or decision-based transactions. The software itself is not a substitute for front end automation but it is software that automates process exceptions. It thrives when subjectivity is driven out of a process and improves the use of rules-based decisions, keeping quality and efficiency up, and driving errors out of a process. It can be a substantial differentiator or value-added service if you are fundamentally committed to changing the process.

RPA is designed around automating process exceptions that are a result of not having automation up front. It quantifies all of the various secession points. We believe that it will move up the cognition scale. You are seeing a degree of it now, in terms of fuzzy logic and historical trends. True cognitive robotics is a ways away, as there are so many different variables, both in horizontal process and all of the vertical variants of the same.

The next level of integrating analytics into the process will enable the software to make better educated guesses. That will be a major step toward improved cognitive processes.

BH: What are the advantages of using a provider for RPA work?

ST: It goes back to the sensitivity of the process, and the software. It requires hands on maintenance. Anything occurring upstream affects the coding of the robots, requiring a dedicated team to stay on top of it. It requires a whole new level of change management and necessitates an ingrained transformation organization that can be cost prohibitive or impractical for a client organization. Working with a provider, an organization can leverage the economies of scale, the process expertise, as well as the collective learning of a BPO organization. They get faster deployments that are more cost effective, with more impactful implementation when using a provider. The provider knows the vertical, the horizontal and the technology.

BH: How is contracting different for an RPA solution vs. a normal BPO solution?

ST: There is significantly more flexibility with an RPA solution. An RPA solution does not even begin with an FTE based assumption, but rather goes immediately to a transaction-based model. It opens up outcome based pricing opportunities because there is a new level of detail in process documentation and transformation, it provides a comprehensive view and thorough understanding of upstream and downstream processes. For example, when you apply an RPA enabled solution to a traditional manual order processing process it provides a better understanding of how it impacts billing, cash applications, DSOs, etc. This enables gainshare, with a more lucrative revenue stream because of the benefit of reducing bad debt or improving working capital. As we see RPA mature and become more adapted, there will be changes to contracting, with the FTE model slowly dying out. There will be a natural shift toward analysts and advisors. RPA will erode the traditional size and scale of resources involved in BPO. This will be an evolutionary process as the market will have to shift.   Some analyst firms base rankings on the number of contracts and people. I believe that this will become less and less important. For a company like Sutherland, it plays into our sweet spot. We have flexible commercial terms and have always leveraged technology and platforms.   RPA will be an opportunity to further differentiate ourselves.

This is nothing different than what Sutherland has been doing for nearly 30 years, RPA just reflects a continuation.

BH: What Are the Barriers to Client Acceptance?

ST: Some clients are innovators and some are more cautious. Clients are reading about new and emerging technologies. There is a natural concern about anything that could impact our client’s customers. We have two different approaches that we take. The first is proof of concepts – a small selection of sub processes or an individual segment of accounts. We will demonstrate what is possible and develop a transformation roadmap to roll into larger scale. The other approach is a traditional lift and shift, with transformation after we have control. Sutherland builds a transformation roadmap after we have control of the process.



About the author

Bill is a sourcing industry leader and active proponent of helping to create professional standards and best practices. His areas of expertise include sourcing strategies, shared services and contract negotiations. Throughout his career he has been responsible for both business development and delivery of strategic advisory services in procurement, vendor management and operational transformation.