Business automation is booming as organisations shift to a digital-first model with the aim of improving customer experience and increasing productivity at an unprecedented scale, all while driving down costs.
Automation is already helping to improve customer interactions in data-rich industry sectors such as financial services, healthcare, insurance, transportation and logistics, travel and hospitality.
As a result, enterprise investment in intelligent automation, which includes artificial intelligence (AI), machine learning and robotic process automation (RPA) is growing fast – expected to reach $232bn by 2025 compared to $12.4bn today, according to research by KPMG.
“We are moving into a customer-centric world more geared to individual situations,” says Brian Safron, worldwide programme director for digital business automation at IBM.
Companies who are used to offering a limited range of products to customers are being outpaced by rivals who are using big data, analytics, decision management and software ‘robots’ to personalise products and services.
“Organisations are in a position where they can serve each customer’s individual needs without the overhead of configurations. They are able to scale up and to change the way they serve customers,” says Safron.
This customer-centric evolution is fuelling the demand for automation and tailor-made services on a huge scale.
“Instead of a bank offering 10 or 20 types of loans, they can now offer 250 types of loans and keep track of everything. The concept of automation enables scale and pushes the limits of individualisation and personalisation and enables organisations to provide customers with what they really need,” says Safron.
New technology-savvy competitors, such as fintechs in banking and Airbnb in travel, are often faster to exploit automation.
“Fintechs have built smart, automated systems that can service and manage a greater level of individualisation, but every company whether they are big or small must figure out how to do this,” says Safron.
Even if existing companies believe they are maintaining retention rates, competitors will be cherrypicking the most profitable customer accounts by offering alternative tailor-made services. A retail bank might hold on to traditional services such as a customer’s checking or savings account, but fintech rivals will be edging their way in to grab the highly profitable loans or credit cards an individual might want.
“Lost opportunities to existing customers are often the most profitable. Rivals are siphoning off the high-margin products and can offer more individualised services because they use analytics and AI to determine just what products their customers need, and flexible automation to provide a streamlined self-service experience,” says Safron.
The ability to automate is changing every sector. Thousands of decisions can be made which are factored by data and analytics. Automation enables organisations to understand the best offer to make to a customer and do it automatically and in real-time.
PNC Bank, for example, has automated the majority of loan applications that just a few years ago had to be processed manually, reducing by over 80% the number of applications that must be manually reviewed.
Speed of automation
Many organisations remain encumbered by time-consuming manual processes. Management consultancy McKinsey found that in 60 % of occupations worldwide, up to 30 % of activities can be automated.
The speed and scale of automation and digital transformation is highlighted by the fact that in a typical bank, a few years ago a medium-sized loan would take several days to approve, but today approval can be achieved in minutes or seconds, almost in real-time, says Safron.
“Business rules, real-time analytics, AI and decision management are tackling more and more complex problems. People can be assigned to work where they really add value to an organisation rather than doing repetitive, time-consuming tasks,” he says.
Scaling operations to become more competitive and flexible and putting the customer at the centre of the business is increasingly making organisations turn to digital business automation.
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