Value of robotics

Indian IT providers are developing robotics process automation as a core capability

For a number of years, the fear of job losses had restrained key board members at Americorp* in sponsoring robotics automation initiatives, though they engaged with their global IT solutions provider from India in ongoing business transformation. In particular, it had a large supply chain management team to manually gather data, create purchase requisitions and generate purchase orders (POs) in their SAP system every week. The POs were then downloaded and emailed to the respective vendors as PDF attachments. Earlier this year, the Indian IT provider offered a “PO bot” that automated the data extraction, purchase requisition creation and approval, PO generation and emailing processes to process transactions four times faster, completing the PO cycle in less than five minutes. The bot also allowed unlimited, on-demand requisition and PO creation based on monitoring live requests and triggering related processes. It reduced the manual effort by 65-80 per cent, freeing up 1700+ man-hours per year in supply chain management activities that were directed to more strategic value-added tasks, as well as help manage its ever-expanding IT and compliance-related tasks.

Research at the Aston India Centre for Applied Research reconfirms that leading Indian IT providers are continuing to develop robotics process automation (RPA) as a core capability for service delivery, offering a cost-effective alternative to rapidly eroding labour cost arbitrage-related opportunities to their global clients. RPA is starting to seriously change the delivery of services and the nature of jobs by stripping those parts of the job that are conducive to such automation as brought out in the Americorp example, while devoting human effort to activities such as strategic data analysis of supply-chain data, leading to changes in client business models and freeing up time for organisational innovation without any significant layoffs.

Most interestingly, RPA has provided Indian IT providers an effective tool to compete against threats of insourcing. The overseas backlash against the impact of automation is increasingly leading them to seek assistance from Indian IT providers, rather than sponsor their in-house automation initiatives. In parallel, Indian providers continue to get better in using automation to cut costs and improve process metrics including responsiveness, timeliness, quality and ease of use. Automation will only breed automation and progress from routine manual tasks to non-routine cognitive tasks, resulting in even HR teams at clients eventually developing an emerging view of talent and capability that would come not just from humans, but also technology.

Let us consider another example at the European firm Law& Law LLP*. Attorneys in their team manually reviewed hundreds of thousands of documents for relevance to the litigation, within extremely challenging timelines and limited budgets. After years of resistance to automation and overseas outsourcing, they worked with a global business process management (BPM) provider from India this year to develop a “learning” algorithm or software model and train it with examples of relevant and non-relevant documents and metadata. Additionally, this algorithm iterates by adding additional examples to improve the model’s intelligence and evolve as a predictive model to score documents based on relevance. This allowed Law & Law LLP to safely and defensibly exclude over 87 per cent of the documents from the review population and outperform time and cost expectations, once again without any significant job losses.

Indian IT and BPM providers, who have emerged as global players are at a cusp of change. Having made several investments over the past few years in emerging technologies, specifically including RPA, their shareholders are holding their breath to reap the rewards. In the words of Leslie Willcocks of the London School of Economics, “Robotics-driven vendors operated at the bottom of the BPO stack as of 2015. Yet if the promised cost reductions and other benefits do materialise, this technology will find much bigger markets.” The recent quarterly results of the major players indicate that this tipping point may now have been finally reached. As always, the future is already here, just not evenly distributed. And as Indranil Choudhury, CEO of Lexplosion, says, “We are all waiting for this digital distribution to get more normalised!”

*Names changed on request