Automation isn’t the panacea for all digital transfomation challenges. In this 5 essentials, founder of Haraa Labs Rags Gopalan details why well-defined processes are key to digital trnaformation.
What are some key themes we’re likely to see in digital transformation over the next decade?
While every industry has their own definition of digital, it’s a very difficult task to get 10 people to concur on a definition of digital. In the last five to seven years, we were focusing largely on customer experience and digital transformation, which is largely a B2C journey. So out of a longlist of 14 technologies we identified seven platforms which have a high impact on customer experience.
This includes CRM as a platform–which has omni channel capabilities–digital wallets, business analytics and intelligence.
What happens is people often think that digital transformation is a technology-led activity. It is certainly technology-led, but what happens is you need to re-engineer the digital processes if most of the processes are not 100 percent automatable. Some of them are 70% automatable, some of them are 30% automatable.
What is critical is, if I automate 70% of the process, I need to relate 30% to the process reengineering. And I need to run two sets of people with different skills. One set of people who can run digital processes and the other set of people who can run a traditional process. This is how the people impact the process.
What are the major challenges with digital transformation?
I think there are two or three challenges depending upon which market you’re talking about. The common challenges are the ability of the IT organization to handle these digital transformations. The biggest challenge is IT evolving into a business and functioning to deliver business transformation.
The second aspect of it is wherever the process maturity is very less digital transformations are bound to fail. We have implemented automation projects for companies where the process maturity is very low. If you take no process maturity companies these processes measured by these companies will fail because digitalization is actually automation of a process which is very well defined. If you have not even defined the process or if your processes are immature, you find it very difficult to automate and run a successful program. These are the top two things which we have seen.
Thirdly, you can’t see automation as a solution for everything. This is a quick ROI program, at least on paper. So everybody is interested in automation because they can show certain things quickly because the ROI timelines for organizations have moved significantly from 18 months to 24 months in getting approved. In many organizations, the ROI is less than a year, typically nine months. Organizations want to spend money and they want to see the impact of this year, not two years later. So automation becomes the easiest business case that could be put up saying that I will put up this business case and I will try to automate.
Are you saying this is a mistake?
No, it’s not a mistake. It has to be approached as if you are automating a business process. And not a technology that’s seen as a quick fix, so to speak.
This is the other problem right now. IT projects where you don’t have a clear view of business processes. You have implemented it for one activity but it is not scaling up so you talk to any of the automation vendors today you ask them what is the biggest challenge they will say that my businesses are not scaling up.
Automation doesn’t solve the problem of scaling. There are certainly many success stories of automation scaling up. We implemented a program on a pre-paid model. That’s probably the first time anybody has implemented automation on a pre-paid model. But the scaling up stories like this are all very well driven program wise and also business-led.
The market is very fragmented today. One vendor does understand the customer’s business completely. He may understand even a process where there are also people. For example today if I have to automate one inbound process for a customer, I require approximately 25 tools and digital platforms and minimum I need to engage about 10 to 12 partners.
So RPA is one mentor and one partner in workforce management becomes one platform and one separate vendor. One guy doesn’t understand the other platform. You see this is the challenge in the industry and the high level one that technology is going to catch up to. The skill sets now are not technology skill sets that are required. You also require skill sets that understand business processes woven into it and you need to have knowledge of adjacent domains if you’re a solution provider. Because no customer buys one platform if it doesn’t impact this internal process.