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Software robots transforming IT services industry

IT service providers, particularly large, global outsourcing firms, are helping customers deploy robotic process automation and also using the technology internally.

Editor's noteThis is the first of two articles exploring the role of the IT channel in robotic process automation. Part one provides an overview of how IT services firms expect to benefit from software robots, while part two examines deployment models, labor issues and the technology's future.

IT service providers are beginning to deploy robotic process automation, a technology poised to eliminate the manual effort associated with many IT tasks and business processes.

With robotic process automation, or RPA, software robots are configured to carry out repetitive tasks that humans previously handled. RPA taps foundational technologies such as artificial intelligence, machine learning and big data analytics to get the job done. RPA deployments vary in sophistication. Bots employed today may execute a script to repeatedly perform a particular function. But the emerging field of Cognitive RPA goes a step further: Software robots can learn about the tasks they are performing and make adjustments. That type of flexibility is what industry executives believe will set RPA apart from earlier forms of automation.

At the moment, large global IT and business process outsourcing (BPO) companies appear to be the most actively engaged with RPA. Those companies use software bots internally to deliver IT services more efficiently and at a reduced cost. In addition, they help customers install RPA within their own companies to automate business processes.

Sreekanth Lapala, senior vice president and global head of Outsourcing Transformation Services, VirtusaPolarisSreekanth Lapala

"It is already part of the mainstream pitch," said Sreekanth Lapala, senior vice president and global head of Outsourcing Transformation Services at VirtusaPolaris, an IT consulting, technology and outsourcing services company. VirtusaPolaris, based in Westborough, Mass., has operations in the U.S., Europe and Asia and employs about 10,000 people.

He said some Virtusa customers are in the early stages of conducting RPA proof-of-concept trials, while a few are doing production pilots. The company is also exploring internal use of RPA for finance, human resources and expense reimbursement processes as well as IT.

Automation Age

Bhaskar Ghosh, group chief executive, Technology Services at AccentureBhaskar Ghosh

IT service delivery is clearly one use case that's captured the imaginations of industry executives.

"The way we do … delivery today is going to completely change in the future," said Bhaskar Ghosh, group chief executive for Technology Services at Accenture. "And the large part of the transformation will happen through automation."

Ghosh said the technology journey over the past several years has been primarily driven by the forces of industrialization and globalization. The next prime mover, he said, will be intelligence -- with AI and robotics at the forefront. He said Accenture uses RPA with an eye to eliminating repetitive, manual work. Accenture's recent alliance with Splunk, a machine data analytics vendor, will help buttress its RPA effort, which Ghosh said requires "a strong analytics base."

Labor savings is a key theme with RPA and one that IT services firms have started to document. In the globalization era, the outsourcing industry turned to labor arbitrage -- offshoring projects to countries with lower labor rates -- to cut costs. With RPA, smart automation rather than sending work overseas reduces labor costs.

Howard Cohn, senior vice president of retail, Sutherland Global ServicesHoward Cohn

Howard Cohn, senior vice president of retail at Sutherland Global Services, a business process outsourcing provider based in Rochester, N.Y., said RPA gives a provider the ability to "offer a lower-cost solution" at as little as one-ninth the cost of a human per robot.

RPA is "often used to greatly reduce labor headcount," Cohn noted. The resulting cost savings enable providers to "become more competitive in offering domestic solutions at an affordable price to their clients."

Siddhartha Singh, senior vice president and head of BPO at NIIT Technologies, also pointed to labor reduction via RPA. Software robots, he noted, can compare data gathered from different systems that humans once had to reconcile.

"An example of one RPA process is where we take data from one application and match the data against specific rules from another application," Singh said. "Prior to RPA, the process was being done with 15 full-time employees, which is now being done by three robots."

NIIT Technologies has been conducting RPA pilot projects for the last two years and launched a formal intelligent automation offering in February 2016.

RPA: Where does it fit in IT services?

Lapala cited a couple of IT service lines that will come under RPA's influence. Help desk operations focused on application support and maintenance is one such field. He said RPA can automate non-ticketing activities that occupy 25% to 40% of a help desk's time -- activities such as monitoring, providing clarifications and reporting. As for ticketing, RPA can help automate common service requests such as password resets and users' requests to access systems, he added.

Another area of impact is IT infrastructure outsourcing. Here, software robots can keep tabs on critical thresholds -- such as storage capacity -- and take corrective action.

"Robots can monitor the thresholds and, under certain threshold breach conditions, robots can even go and address the fix if [they are] configured to do so," Lapala said.

RPA: IT services adoption trends

As CEO of Automation Anywhere, Mihir Shukla has firsthand experience with IT service companies' adoption of RPA.

Shukla said 16 of the largest 20 IT service providers partner with the company and its RPA software. He said the company works with the big four professional services firms as well: Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers. Those two sets of companies "act as a channel for us on large deployments," he said.

The company's channel partners, he said, are taking RPA to "an industrial scale," training thousands of employees on the technology. But while RPA is most prevalent among large companies, Shukla said the software robots will move downstream to smaller service providers and eventually become a consumer technology.

"Like any other technology, it starts at the enterprise and eventually makes it to the consumer," he said.

He said IT services companies are deploying RPA in those areas to take the manual effort out of supporting customers with multiyear contracts.

Cohn said Sutherland Global leverages RPA in many of its client projects.

"As we perform our due diligence for a solution, we are consistently looking for processes that exhibit the characteristics to apply RPA," he said.

Processes ripe for RPA include those that are rules-based, high volume or span multiple systems, Cohn noted. Processes that involve repetitive tasks, collation of data from various sources or data entry tasks are also candidates for software robots, he added.

When it comes to IT services companies, [RPA] definitely has a tremendous amount of benefit.
Sreekanth Lapalasenior vice president and global head of Outsourcing Transformation Services, Virtusa

RPA cuts the labor costs out of such processes, but that isn't the sole benefit of the technology. The technology also offers a less intrusive method for integrating systems. That's because software robots access applications through the user interface, as humans do. Singh said the robots connect to various UIs, including legacy green-screen applications, and don't touch the underlying software. Since programmers don't need to modify the back-end applications or build custom interfaces, RPA projects require less time and money than traditional automation projects.

Siddhartha Singh, senior vice president and head of BPO, NIIT TechnologiesSiddhartha Singh

Singh said automation projects would typically take anywhere from six months to three years to complete and cost between $500,000 to $2 million or more. While the timeframe of an automation project depends on various factors, some RPA projects can be up and running in as little as six weeks and up to 10 weeks for a more complex process. An RPA project can cost about $150,000 to $250,000 for five robots, he said.

Other RPA advantages, according to Cohn, include better quality, faster processing times (i.e., hours vs. weeks), substantial improvement in traceability for audit purposes and increased analytics for better business intelligence and reporting. He added that RPA also affords the ability to more easily scale and address fluctuations in volume.

"When it comes to IT services companies, [RPA] definitely has a tremendous amount of benefit," Lapala added.

Next Steps

Read more about software robots and their implications for IT/business process outsourcing firms

Find out about the linkup between robotic process automation and business process management

Learn about robotic process automation's role in shared services

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