By Iya Datikashvili, Director, Brickendon
The UK is becoming an automated economy, and we believe 2018 will be the year that automation becomes the norm across the financial services sector. Technologies such as artificial intelligence (AI) and robotics are growing up and now performing tasks that were once carried out by teams of individuals, saving companies time and money, and increasing their competitive edge. One such technology is Robotic Process Automation (RPA), a software robot or ‘bot’ that mimics human activity by carrying out routine processes. Many people believe that RPA has the potential to unlock significant value within a company by performing a range of complex, time-consuming and repetitive functions, thus freeing up employees to focus on value-added work and ultimately, overhauling archaic systems and transforming the way the financial services sector operates.
The key is to embrace these developments now. Financial institutions, including banks that fail to engage and incorporating technological advancements, such as RPA, risk falling behind.
With overwhelming amounts of information on the subject and conflicting opinions saturating the market, now is the time to comprehensively assess whether RPA can improve the financial services sector.
What is RPA?
Defined by the Institute for Robotic Process Automation & Artificial Intelligence (IRPAA) as the application of technology that allows employees to configure computer software or a robot to capture and interpret existing applications for processing a transaction, manipulating data, triggering responses and communicating with other digital systems, the advantages of incorporating RPA into your business processes are many. In a bank, RPA has the potential to reduce the number of operational errors; increase efficiency as robots can operate 24*7; reduce costs as all the people involved in the manual processes can be replaced by a single programmed bot; add scalability, as the number of bots can be increased or decreased based on operational volume needs; increase customer satisfaction due to a faster turnaround; and improve accountability as the audit logs of robot operations would be constantly available.
Implications for the future
Does this really mean that in the future all humans will be replaced by machines and that robots will eventually try to take over the world in the style of the Terminator movies?
In reality, the answer is no. The intention behind RPA implementation is to ensure organisations are able to better utilise their employees in areas that add value to a firm’s operations and delegate the repetitive tasks to automated machines. The ‘bots’ need to be programmed to replicate the human actions required in the process, while humans are also required to provide support and supervision to ensure any issues which may impact the process, such as network failure, a ‘bot’ crash due to error, or exceptions in the operations, can be dealt with.
Is RPA for you?
Not all business operations would qualify to be automated using RPA. Firms will need to assess their operations to establish selection criteria for processes which can be automated. Some questions to consider are: does the input have a defined structure; is it a standardised process; is the re-work rate high due to a large amount of manual/human error; does the process have to be replicated in multiple geographical locations and require support teams; is 24*7 support required?
The tools which enable RPA are proprietary and licensed, meaning the process of adoption can be costly. As a result, organisations need to assess their business-as-usual (BAU) processes for the suitability of RPA application and then develop a strategy to determine how to introduce RPA for the candidates identified, as well as performing a Return on investment (ROI) assessment and ensuring the most appropriate tools are selected.
Ultimately, firms should only adopt RPA if it provides substantial benefits in the longer term, but given the aforementioned advantages that can be reaped, there is no doubt that for the right projects, the ROI will outweigh the initial costs and investments.
One thing to note is that thus far, the bots used for RPA can only demonstrate intelligence based on what they are programmed for. However, constantly evolving technology has introduced innovations like Artificial Intelligence (AI) which can empower the bots to adapt to issues and behave accordingly within business processes, i.e. enact remediation actions. So, while there may currently be limitations, the opportunities for future developments are vast.
Functions of businesses such as procurement, supply-chain management, accounting, customer service, HR, purchase-order issuing, and generally any other process area where tasks are manual, repetitive, standardised, and rule-based and involve structured data, could also benefit. In IT, RPA can be embedded within support and management operations like network monitoring, service-desk operations, and automated customer assistance. Typically, these operations are essential to keep organisations operating effectively, though they are often overlooked when it comes to funding because they do not necessarily generate revenue.
So what’s next?
The key is to assess your options. There is no doubt that as RPA becomes an increasingly popular buzzword, its benefits merit further consideration. After all, automating even just a few of the vast number of processes necessary to make a bank function would enable organisations to improve their operational efficiencies and reduce costs – and in the end, cost and efficiency are what matters most to businesses.
Predictions 2021: The Path To a New Normal Demands Increased Business Resilience and Cost Efficiency
By Jussi Karjalainen at Valtatech
A global pandemic, wild bush fires, a stock market crash, a presidential impeachment, and presidential elections – 2020 has been a year like no other and the impact on some businesses has been devastating. 2020 has highlighted how vulnerable many businesses are, and what they need to improve to survive and thrive – a topic that I recently wrote about. The key focus for businesses moving into 2020 will be on how they recoup their losses from 2020 and set themselves up for success. With that I mind, here are my 5 predictions on what 2021 will bring for businesses and what they need to be thinking about as we head into a New Year.
Continued Business Disruption – There are some serious global headwinds that businesses are set to face next year. Many countries are likely to go in and out of lockdowns, which will impact on local and global supply chains, consumer, and business spending, as well as overall business confidence. There is also the unknown of how the results of the US Presidential election and final transition of the UK out of the EU will impact global trade relations. Recent talk of a vaccine to stem the COVID-19 pandemic may provide some reprieve, but we predict continued business disruption heading into 2021.
So, how can your business prepare for disruption? Business resiliency is key. Namely your business ability to rapidly adapt and respond to business disruptions. 2020 taught us that finance and procurement operations are key to driving business resiliency. Getting a view and a grip on where your business is spending its money? What can be consolidated and what can be reduced? Having full control and visibility over your finance and procurement operations are key.
Cost Efficiency Should be at the Top of Everyone’s Agenda – If 2020 has shown us anything, it is that we need to have greater control over our cost base. Not least because sales are, largely, harder to come by than ever before. Every organisation should be looking at the return that they are getting for every dollar invested – a simple equation of your total spend divided by your total revenue will give you a high-level overview. The focus for businesses will be on how to improve this ratio. For example, for every dollar spent enables $1.60 in revenue – increasing that number can have a huge impact on your overall profitability.
You can take a few approaches to getting this right: There is the 1% improvement approach – how can you make each process 1% more efficient and reap the benefits of the cumulative impact of those 1% gains. The alternative is to assess a specific process in more detail. Take your procure to pay process as an example. Map out your current process, identify the pain points that take the most time, and build out a business case to drive greater efficiencies in that process. It is a process we have undertaken with several businesses to deliver real bottom line value.
Konica Minolta Business Solutions Asia recently outlined the results of their procure to pay digital transformation project which “helped us to reduce costs, identify risks and improve value delivery across the business; while providing the visibility and insights my team and I require improving risk mitigation, due diligence processes and governance.”
Public Sector Spending Spree – Most national and state governments have announced large economic stimulus packages to get their economies going again. This will likely continue heading into 2021, with many tenders and grants being made available. Businesses wanting to take advantage of this spending spree need to be mindful of the likely compliance requirements for public sector contracts and grants. To qualify for many public sector contracts or grants, businesses may need to prove they comply with regulations around supply chain sustainability, modern slavery, buy local and national initiatives, diversity, and inclusion, for example.
In order to prove you qualify it helps to have systems and processes in place that can make supply chain mapping and transparency much easier giving you clear visibility over your entire supply chain. This enables you to know exactly where your goods are coming from in your supply chain, from who whilst being able to capture important information relating to compliance around sustainability, modern slavery etc.
Data, Data and even more data – As businesses seek to ensure their business resiliency, the demand and need for more accurate and timely data across business processes will greatly increase. Businesses that can track efficiency at a process level are going to become more cost efficient and future-proof their business. Equally, as business disruption continues, the demand for business agility can only be fulfilled through executives having access to accurate and timely data, which will put more pressure on teams to supply that data.
An effective combination of people, processes and technology can provide hugely valuable and actionable data insights. Considering the source to pay process, having access to data insights, such as invoice processing times, percentage of purchase orders and invoices sent and received electronically, and percentage of managed spend (e.g. spend going through contracts, preferred agreements etc) can reveal some real opportunities to drive efficiencies in your process.
Technology being the answer, rather than the enabler – It is only when the right processes and people are combined together with technology that real transformation can occur. Too often businesses look to technology as an answer to a problem, rather than an enabler to help solve the problem. Picking the technology before truly understanding the process that they are trying to transform has led to many failed and ineffective technology projects over the last 20 years. As businesses find themselves under more and more pressure heading into 2021, businesses will likely continue to make pressured transformation decisions based on fancy, shiny technology, rather than a clear understanding of the outcomes that they are hoping to achieve. Creating unnecessary and avoidable risk into their transformation activities.
Instead, why not conduct an in-depth analysis of your current business requirements through key stakeholder interviews and current process reviews? This can help to deliver valuable insights and resources such as:
- Key insights into the current processes
- Identification of key pain points
- Identification of key levers to drive user adoption
- Identification of key areas and drivers for financial return on investment
- Identification of quick wins and longer-term development areas
- Current state technology landscape map across your processes
Beyond the bottom line: why brands must show they care to connect with customers
By Vadim Grigoryan, Partner, Lunu
Over the past few years, we’ve witnessed an ever-growing activism among consumers, with public opinion demanding that their concerns be heard and addressed. No industry has experienced this more than the retail sector, with brands regularly slammed by NGS or consumer-led initiatives for violating legal requirements or moral principles. Moving one step further in the experience economy, brands are not only required to provide a first-rate customer experience, but also a conscience. The product must be good quality, as should the experience of purchasing it. But now on top of that, consumers should feel positive about where they’re spending their money. This is particularly true in the crypto community, with cryptocurrencies regularly pointed out as too speculative as a product, or to energy-intensive. Is this really a surprise coming from a generation whose top concerns are collective ones such as the environment and global warming? The answer is a straight no! Brands have to face this new reality and embrace it accordingly.
This next step in the experience economy, that can be called conscious consumerism, provides an opportunity for brands to reinvent themselves and bring to the top of their agenda something that has so long been kept at the bottom, or on the side. Brands need to stand for something bigger than themselves. If they fail to do so, they will also fail to make an impact in the consumer’s mind, ultimately disappearing as a brand altogether.
- From the experience to the conscious consumerism. Today’s economy is as much about giving people the opportunity to feel good while purchasing the product or service, as it is about the feeling after the purchase. Environmental, social, and moral concerns are increasingly at the top of consumers’ minds and on the front pages. Brands need to realise this and adapt, but also accept this as an opportunity rather than a constraint. Profitability isn’t the number one priority anymore and they now have the chance to fully develop their CSR programmes without facing many of the internal/external constraints they would traditionally have faced.
- Having a meaning actually means something. Modern brands have to stand for something and if they do, they will also stand out in the consumer’s mind. Your brand won’t just be a jewellery maker anymore – it will be one that aims to make diamonds cleanly and ethically by creating them in a lab instead of digging them out from thousands of meters below the ground. Standing for something will also give you a voice and help you break through the noise, reaching out to ever more consumers.
- Having a purpose provides a valid reason to exist. By this we mean existing in the customer’s mind, as well as in stores and shops – because the truth is, both are now linked. To truly connect with your customers, brands need to go beyond their bottom line. They also need to show that this bottom line serves a purpose and isn’t a finality. Don’t be scared to embrace a cause if you want to keep a place in consumers’ hearts and minds.
The largest event in e-commerce history? ‘Tis the season
By James Booth, VP Head of Partnerships for EMEA, at PPRO
Sometimes, change happens slowly. Other times it chases you down like that boulder at the beginning of Indiana Jones. In 2020, change is fully in boulder mode. And the holiday season is when it either catches up with you or you leap triumphantly from the temple entrance, golden statue in hand.
The shopping season kicks off on 11 November, with the 11.11 Global Shopping Holiday (formerly Singles’ Day). According to analysts, Alibaba and its merchants are on track to rack up $45 billion worth of sales on Singles Day alone , up from $38 billion last year . And if last year’s results are anything to go by, a large proportion of those sales will go to non-Chinese companies. Last year brands such as Bose, Estée Lauder, Gap, Levi’s, Nike, The North Face and Apple all made over 1 billion yuan ($143 million) on Singles’ Day .
Increasingly, US and European consumers are also participating in Singles’ Day. However, both markets shift into proper holiday mode with Black Friday on 27 November. And there is every indication that this, too, will be bigger in 2020 than ever before.
Adobe Marketing Insights predicts a 20% increase in e-commerce spend over the Black Friday to Cyber Monday weekend . Looking at the holiday season as a whole, Deloitte forecasts that seasonal e-commerce — online spending is expected to grow by up to 35%, compared with just 14% last year .
But that doesn’t mean you can just relax and wait for the holiday season sales to rack up. As well as driving customers online, lockdown has also disrupted brand loyalties. During lockdown more than two-thirds of customers in some markets have tried a new product or service and of these, a quarter do not plan to return to their old habits once lockdown has ended .
Old shopping loyalties have been upended, and that means their holiday-season shopping is up for grabs.
For instance, 43% of over-65s are now shopping online compared to just 16% before lockdown . For online merchants the grandparent present budget just became accessible. But to win your share of it, you have to provide a customer experience that this demographic will love.
Making the checkout page a priority
The question then, is how to prepare your merchants’ or your own e-commerce site for the holiday shopping season. It’s only a few weeks until Black Friday, so there’s no time to lose. You need to find out where gaps are in your customer journey, and plug them, before those customers run away to someone else.
The customer experience at checkout is particularly crucial. One of the surest ways to lose customer trust at the checkout, is by not offering shoppers’ preferred payment methods. According to research by PPRO, up to 50% of customers have abandoned a transaction because the merchant did not offer their preferred payment method .
It’s a question of localisation. Except in this case, you’re not necessarily localising for customers in a particular geography. Instead, you might consider localising for consumers in a particular age group who are now shopping online for the first time. Or customers from a range of demographics who have never shopped online for a particular category.
No one size fits all when it comes to global payment preferences
If you want to succeed in global e-commerce, you must offer the preferred payment methods for every market and demographic you want to win over.
Worldwide, consumers use alternative or local payment methods in more than 70% of all consumer transactions . These are the payment methods whole markets and demographics grew up with online and trust. Fail to offer them and you can have the best possible customer journey, but you’ll still lose basket after basket at the checkout.
With the acceleration of e-commerce and the influx of online competition, anyone who hasn’t optimised their payments offering will be desperately racing to catch up. Merchants need to think now about how they are going to maximise their revenue from what looks to be the biggest online holiday season ever. And payments is a crucial part of that conversation.
9. Original PPRO research.
Predictions 2021: The Path To a New Normal Demands Increased Business Resilience and Cost Efficiency
By Jussi Karjalainen at Valtatech A global pandemic, wild bush fires, a stock market crash, a presidential impeachment, and presidential...
Is now a good time to consider art as an investment?
By Anita Choudhrie, Founder of Stellar International Art Foundation Back in April, as Covid-19 began to have a significant impact...
DAC 6 – D Day is imminent – Update of key elements
By Andrew Knight is managing partner of Harneys Luxembourg office and head of its Tax and Tax Regulatory team in...
5 steps for SMEs to budget properly for the coming year
By Fabio Comminot, Head of Dealing, Switzerland at Ebury, one of Europe’s largest Fintechs, has provided a five-step guide to...
Cash in the time of Covid-19: A tale of financial exclusion
By Matt Adam, company’s chief executive, We Are Digital Financial exclusion rates are on the rise thanks to Covid-19. But...
Track and Trace and Other Lost Data
By Ian Smith, General Manager and Finance Director at Invu You, like me, were probably amazed by the now infamous...
Why ID verification is no longer a barrier to global growth in banking
By Barley Laing, UK Managing Director at Melissa Issues related to effective identity (ID) verification have restricted the global growth...
Digital Finance: Unlocking New Capital in Disrupted Markets
By Krishnan Raghunathan, Head of Finance & Accounting Services at WNS, explores how a digitally transformed finance department can give enterprises...
Beyond the bottom line: why brands must show they care to connect with customers
By Vadim Grigoryan, Partner, Lunu Over the past few years, we’ve witnessed an ever-growing activism among consumers, with public opinion...
O-CITY enters Kenya to drive contactless payments across Matatu bus service
Up to 10,000 buses to become cashless with O-CITY’s M-Pesa-based ticketing solution O-CITY, the automated fare collection provider by BPC,...