Robotic Process Automation (RPA) — A Bridge to Enterprise Success

by Dan Steketee, Managing Director

Robotic process automation, or RPA, is a technology driven process used to automate business processes and workflows. RPA uses software “bots” to accomplish and alleviate employees from repetitive, routine tasks like claims processing, forms processing, applicant reviews, scheduled reports generation, data normalization and consolidation, purchase order issuing, HR tasks, and data entry that are traditionally handled by employees in financial services firms.

RPA’s main benefit to our clients is it automates the existing graphical user interfaces (UI) control process when an application/platform does not offer APIs. The RPA process involves everything from screen scraping, image processing, Optical Character Recognition (OCR) and robots steering graphical user interfaces.

The current RPA toolset is very robust. The large number of RPA platforms consist of everything from enterprise SAAS platforms selling minimal code solutions to python code-heavy platforms. Most tools available, including those from industry leaders UIPath and AutomationAnywhere, integrate the old legacy applications and as a result help firms, like our clients, who are challenged with integrating and retiring legacy applications due to the significant amount of ‘spaghetti’ code and stored procedures built over the years. Historically, firms either internally built or bought off-the-shelf software that didn’t have proper APIs and/or custom solutions with an UI as the primary or only interface, and thus their legacy system integrations were typically done on a database level with clumsy enterprise application integration (EAI) tools or batch jobs. As a result, SLAs were constantly missed, and developers spent additional hours researching and resolving defects and issues.

In today’s financial services firms, IT architecture and infrastructure need enterprise modernization. RPA can be the bridge to modernization by helping firms expedite the legacy application retirement process. Unfortunately, RPA adoption is never easy and here are some challenges we and our clients have encountered when implementing it.

1) Employee Resistance — IT resources perceive RPA to be intrusive and believe it will result in significant architecture changes. Resources are worried about data security and system integrity, and also concerned that RPA is intruding into their level of expertise.

2) Increased Costs — RPA causes increased short-term costs including implementation and consulting costs. Recurring configuration, licensing, maintenance and customization costs must also be considered when building the RPA business case and calculating the ROI.

3) Ownership / Change Management — Who owns and manages the RPA process and fixes it when it breaks going forward? IT or Business?

4) Keeping the Lights On / “Business as Usual” — With RPA, IT resources believe there will be too much time spent on maintaining existing legacy applications. This is typically known as “keeping the lights on” and it stops many firms from innovating and tackling new projects. Statistics show that some financial services firms spend approximately 80–90% of their IT budget on maintenance and RPA. If RPA is not executed properly, it will create more problems.

5) Transparency Issues — With multiple processes running behind the scenes, it becomes difficult to figure out what process is running what and where. Without the right monitoring system in place, the concerns are valid.

6) Timing / Lack of “Forward Thinking” — The existing company culture and mindset may not be able to execute RPA successfully. With the core enhancements in technology and digital disruption over the last few years, it has become very clear that most leading financial services firms have become essentially IT companies and are now focused on providing ‘information only’ rather than ‘tangible goods’. For example, if you look at industry leaders like JPMorgan, Goldman Sachs, and Capital One, they are literally transforming from the old legacy banks that deploy tech to innovative enterprise technology firms that distribute finance. The mindset may prevent firms from executing RPA successfully.

To successfully transform, firms must acknowledge RPA as only an interim technology and focus on integrating all platforms/solutions via proper API’s, whenever possible. When implementing RPA, engage IT in the process from the very start and explain safety measures, governance and change management to all the future users and key stakeholders. If your firm currently uses RPA, make sure the strategic ‘lens’ is always focused on the future and continue to execute RPA in parallel with the long-term strategy for the firm. Although it may initially cost more, hiring more intelligent, skilled and sophisticated employees to help build for the future and sustain your company now, is better than continuing to build workaround bridges to run platforms off years of home-grown spaghetti code. RPA also needs to be fully part of your future IT strategy and roadmap until it is no longer needed.

With the right set up and approach, RPA can be a great addition to your firm’s toolbox. It will successfully integrate legacy applications that do not provide APIs and help your firm optimize and stay focused on the future roadmap. By combining RPA tools with a workflow BPM engine that automates, monitors and controls the underlying business processes, your firm will be guaranteed future success. The tool combination is very powerful and will allow your firm to have a best-of-breed architecture and keep the lights on with significant advantages — proven methodology, best practices, unified approach for automating business process (including both APIs and/or RPA), and efficient human task management. The advantages will allow your firm to evolve and address operational challenges around deployment, governance and flexibility and continually address change. As a result, it will expedite your firm’s modernization and allow it to become a much more successful high-margin business.

Only firms that embrace and continually improve IT will get ahead of the market and survive in the long run. Using RPA as interim step will help get you there. Executed properly, it will improve integration between systems, increase compliance, create better operational process management, and as a result improve the customer experience.

In the next few years, we most likely will see RPA platforms leverage more machine learning to automatically provide business­­ processes with additional analytics, showing key stakeholders the overall optimization and improvement in firm wide efficiencies and where 3rd party vendors and internally built software should be retired.

Time will only tell where RPA is headed next as more and more firms modernize and adopt ai/machine learning technologies.

Cenotech Solutions has a long history of automating business processes and working with RPA vendor applications, their clients, and other leading asset servicers, investment managers, asset owners, and financial services vendors.

Founded in 2013, Cenotech solutions is a financial services technology consulting firm focused on asset management and asset servicing firms.