Robotic process

automation
White paper

03 December 2015
Contents
1. Executive summary .................................................................................................................... 3

2. What makes RPA different? ........................................................................................................ 4

3. Building a better working world with RPA ..................................................................................... 6

4. RPA versatility: opportunities galore ........................................................................................... 8

5. Demand for RPA to shoot up in the coming years ....................................................................... 11

6. RPA delivery models ................................................................................................................. 13

7. EY credentials .......................................................................................................................... 14

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1. Executive summary
Increasing volatility and an uncertain macro environment have increased the complexity of doing
business, globally. Organizations are investing in innovative technologies to tackle the rise in labor costs
and lack of skilled resources. Existing enterprise resource planning (ERP) systems have their own
limitations, such as lengthy implementation life cycles, and also require significant human intervention
and change management. Businesses are therefore approaching a new era of human–machine interface to
transform business processes and reduce costs.

“Robots” are software tools that have emerged to simplify business process delivery. The technology
behind this development is called robotic process automation (RPA).These software robots offer improved
business efficiency, data security and effectiveness by mimicking human actions and automating
repetitive tasks across multiple business applications without altering existing infrastructure and systems.
Enhanced productivity, reduced cycle time, and improved accuracy and compliance are some of the
benefits of this technology.

Today, high-volume, highly repetitive, multistep tasks with many validation rules, and manual processes,
are automated end-to-end using RPA. This revolutionary technology will continue to leverage elements of
artificial intelligence for sophisticated decision-making in the future too. For example, within a few years,
RPA will operate more like a human brain, which can adapt and assess, and perform cognitive tasks by
sensing, predicting and inferring; it might even have a certain level of emotional intelligence. In short, it is
all about “giving power to the robot.”

RPA is increasingly the innovation of the day, with a renewed focus on efficiency, cost reduction,
compliance and deploying employees on high-value tasks. The scope for RPA is wide and encompasses
many sectors. However, reaching this potential might take time, and business cultures and societies will be
affected once they adopt it. Robots will have an effect on social agendas, tax policies, talent management
strategies and global business services (GBS) sourcing strategies, among others. Hence, businesses
should start preparing for, and understanding, the potential impacts of this technology according to their
needs.

This white paper focuses on software robots, and hopes to educate you on the coming tsunami, so that
you stay relevant, are proactive, and become part of the conversation at the front end rather than being
reactive. Embracing what is coming and leveraging your company’s culture to accelerate its adoption will
give you more control over your destiny and enable you to use robotics to support your company’s
strategy.

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2. What makes RPA different?
The Institute for Robotic Process Automation (IRPA) defines RPA as the application of a technology. This
technology allows employees in a company to configure computer software or a robot to capture and
interpret the existing applications for processing a transaction, manipulating data, triggering responses
and communicating with other digital systems.1

So what is RPA? RPA might be the most disruptive technology that many have never
heard about. It is an overnight sensation developed over the last 10 plus years. Some
say, “Hold on! It is just the relabeling of scripting or other automation tools, which have
been around for 20 years.” Others say, “RPA will change the way we look at work
forever.” Today, it is probably somewhere in between, but leaning toward the latter.

RPA emulates a “virtual human,” and takes artificial intelligence and expert systems to a higher level. The
ability of a software robot to adapt to circumstances and situations, compared with traditional automation
systems, make it eligible for almost any function in an organization, in any sector. RPA holds the top
position in any company’s information technology infrastructure. It drives the existing application
software in the same way as a human employee would do, with the same access rights. This allows any
organization to implement the technology quickly and efficiently, without changing underlying systems
and processes.

As markets and technology change and evolve, so do systems and processes. RPA enables companies to
react quickly, without recoding or reconfiguring projects or developing new interfaces. RPA in one form or
another will be around for a long time for this reason.

In short, RPA is automation. However, it is not desktop automation like scripting, screen scraping or
macros, which are easy labels to categorize it, or diminish or dismiss its impact. These labels also make it
easy to “understand” where it fits in the technology stack. RPA is not cognitive automation, but is
definitely moving in that direction so, at the moment, it is somewhere between the two.

Organizations at the forefront of ‘innovations’ will automate now.

Others will slowly follow as the technology matures.

There are three classes of RPA technology.2 The first one is basic process automation, which focuses on
automating tasks that depend on structured data (data in spreadsheets, CSV and XML). Easier
implementation and management of Class I automation is being increasingly adopted. Class II, or
enhanced and intelligent process automation, works largely with unstructured data as input (e.g., email
and documents). This type of automation can learn from experience and apply the knowledge to process
different requirements. The third class, of cognitive platforms, can understand customers’ queries and
execute tasks which previously required human intervention.

Rules-based Enhanced and intelligent Cognitive

automation process automation platforms

Decreasing intelligence Increasing intelligence

1.“what-is-robotic-process-automation — IRPA,” IRPA website, www.irpanetwork.com/what-is-robotic-process-automation,
accessed 10 September 2015.
2.“Xephor Solutions — Technology,” Xephor website, www.xephor-solutions.com/technology.html, accessed 29
September 2015.

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What makes RPA different?

Classes of RPA technology and estimated cost savings:

Level Types of RPA technology Description Estimated

cost saving
Class I Basic process automation Macros, screen scraping and business workflow 10%–20%
technologies in the presentation layer; not integrated
into the IT system
Class II Enhanced and intelligent Technologies using natural language processing; able 35%–50%
process automation to understand unstructured data and apply it to
process automation
Class III Cognitive platforms Cognitive computing systems that essentially attempt >60%
to solve problems in the same way as humans, by
learning from experience and acting on that learning

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3. Building a better working world with RPA
RPA supports the corporate strategy of building a better working world at EY. Our Global Delivery Network
(GDN), which comprises more than 13,000 people, our Global Business Services (GBS) and our client-
facing talent hubs, are currently implementing robots.

We expect that with RPA, employees will be able to lessen the time spent on manual, repetitive and rules-
based tasks, focusing more on customer service, innovation, analytics and business-value projects. This in
turn will improve overall employee and client satisfaction. Upskilling of talent, improved data security and
the potential to effect a better work-life balance are some other anticipated benefits. We believe our
clients should also see similar results.

3.1 Automation’s next frontier: the value of RPA

Decreased operational costs
Offshore outsourcing has been the favored business strategy for reducing operational costs for the past
few decades. This is because labor is very expensive in western countries compared with developing
countries such as India and the Philippines. US multinational firms hired nearly 2.4 million offshore
employees and cut 2.9 million jobs in the US between 2000 and 2010. Offshore has its costs, but it is not
nearly as high as payroll within the US. RPA technology has proven to cut the cost of an offshore full-time
equivalent (FTE) to half.3

Virtualizing workforce: the next generation of back-office efficiency

Traditional
onshore
Offshore labor Digital labor
labor
US$38K/year US$13K/year
US$100K/
year

One of the most powerful benefits of RPA is the scalability of its

usage across industries: it can work 24 hours a day for 365 days
a year with 100% accuracy.

3. Robotic process automation primer June 2015, IRPA.

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Building a better working world with RPA

Data analytical ability

The software robot generates process logs whenever it executes work, containing a lot of management
information (MI), which can be further analyzed for improved decision-making. This is possible at both the
micro and macro levels of business processes. As processes are micro-managed, this would enable
companies to track gaps and deploy measures to allow further optimization.

Improved regulatory compliance

Regulatory compliance is very important for companies expanding their operations globally. A fully RPA
automated process would enable them to track every step and systematically document them. This helps
companies to be more compliant with industry and audit regulations.

Increased efficiency

A software robot is capable of working all day, every day a year, and does not require any time off.
Typically, a single software robot can replace between two to five FTEs.4 Software robots can execute
more work in less time, thereby gaining control of resource requirements during peak processing periods.

Increased employee productivity (flexibility and multitasking)

Employees can devote their time to complex tasks, adding value to the existing processes, while software
robots handle repetitive, tedious jobs. They can be involved in activities that call for greater human
intervention. This includes personal interaction, problem solving and decision-making processes. This all
adds on to employee productivity and benefits the organization on a broader scale.

Reduced error rate and delivery risk

Software robots virtually eliminate processing errors if a process is properly optimized and its sub-
processes are mapped. However, they require testing, training and governance to achieve desired
outputs.

Increased customer satisfaction

Automation results in more efficient and error-free processes, giving employees more time for direct
interaction with customers, enhancing their experience, improving customer satisfaction and building
their relationship with the company.

Logistical advantages
RPA eliminates the need for offshore labor, and complications with recruiting and managing employees in
different time zones, together with any cultural and language barrier among employees. Companies can
also reduce training costs significantly.

3. Robotic process automation primer June 2015, IRPA.

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4. RPA versatility: opportunities galore
Organizations are constantly identifying processes that can be automated. The best candidates for RPA
have the following three key characteristics:

• Actions are consistent, with repeated steps

• Template-driven, with data entered in specific fields in a repetitive way
• Rules-based to allow decision flows to alter dynamically

The figure below illustrates the effective use of RPA by individuals and teams:4

Perform complex Access more

decisions based than one system
on algorithms to complete a
process

Carry out
Undertake information
structured, searches,
repeatable, collation or
computer-based updates
tasks

Areas of RPA implementation

4.1 Processes: RPA in action

With definable, repeatable and rules-based processes, RPA can make a marked difference in any industry.
Industries such as health care, banking and insurance dedicate a considerable number of labor hours to
handling monotonous tasks and so hold the most potential for RPA technology.

There is negligible demand for RPA in some sectors and functions

now. However, uptake is expected to penetrate more widely in the
near future and then increase sharply.

4. Robotics process automation ushering innovation, cost Savings, Xchanging.

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RPA versatility: opportunities galore

RPA can be more effective at operating multistep tasks across multiple systems, including, but not limited
to, the following:

IT Supply chain HR

Installation Inventory management Payroll

Work order
Email-related tasks Onboarding
management

File management Freight management Benefits

Batch processing Returns processing Compliance reporting

Personnel
Server monitoring Contract management
administration

Finance and accounting Sales and marketing Legal

Procure-to-pay Vendor management Contract analysis

Order-to-cash Incentive claim Extract or report data

Sales order Sales order Deal analysis

Incentive claim Collection Payments processing

Collection Trend tracking Negotiation

Finance and
accounting
Sourcing and
procurement
HR
IT
Sales and
marketing
Legal
Banking and Technology,
Travel and Energy and
financial Insurance media and Manufacturing
hospitality utilities
services telecom

Most attractive areas for RPA Emerging areas in RPA Currently has nil or low applicability

Source: EY analysis based on secondary research.

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RPA versatility: opportunities galore

Organizational preparedness for RPA deployment

Organizations might face challenges while implementing

RPA. Stakeholders may raise questions on financial The opportunities are many, but so
benefits and whether RPA can live up to its promises. For
the successful and smooth deployment of RPA, and to
are the adoption challenges.
avoid unexpected challenges around introducing, Stakeholders may raise questions
implementing and managing robotic automation, an
organization has to be well prepared in the critical areas on financial benefits and whether
shown below.5 RPA can live up to its promises.

1 Develop robotic skills

Learning or hiring additional skills in

2 Explain business costs
to C-suite executives

Getting the buy-in of C-suite is the first

testing and quality assurance to handle step, which involves explaining the
bottlenecks that may not surface until business case for the cost of robotic vs.
robots are executing processes at a scale in-house or offshore FTEs.
and are subjected to variables of live
virtual machine environments.

Critical areas
of RPA
deployment

3 Be ready with business

case

Having a detailed understanding of the

4 Collaborate with IT
team in novel ways

Getting the buy-in of the IT team is

current cost of the business process to be essential to the project’s success. IT
automated. It is difficult to prove savings support is critical to tackle new issues:
that could be achieved with a robot capacity planning and failover for servers
unless it can be quantified against the and storage, licensing of virtual
cost of human employees. machines, and network latency and
response times.

5. Robotic automation emerges as a threat to traditional low-cost outsourcing, HfS Research.

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 5. Demand for RPA to shoot up in the coming
years
5.1 Market overview
Organizations that are mature in outsourcing have an increased focus on automation as the next level of
cost reduction. This has set the market for RPA to grow very strongly.

The key factors driving the market include cost benefits and the improved efficiency of RPA. RPA’s ability
to interact with application software without integration and its ease of use as an alternative to offshore
outsourcing may increase its adoption in major horizontal functions and sectors.

The highly transactional and regulated nature of banking makes it ideal for process automation.

The global RPA market is expected to achieve a compound annual

growth rate (CAGR) of 60.5% between 2013 and 2020, reaching a value
of almost US$5b in 2020, up from US$183.1m in 2013.6

Around 68% of RPA customers are based in North America and the UK.

Global RPA market size (US$m), 2013–20206 Global RPA adoption trend by region, 2014 7

4,980.0 Eastern Europe

Europe
North America
3,051.4 Asia-Pacific

1,907.1

1,191.9
745.0
465.6
183.1 291.0

2013 2014 2015 2016 2017 2018 2019 2020 Early adopters Nascent stage
Note: This graphic depicts the RPA adoption trend, based on Everest Group’s research on profiles of customers that were listed on
automation vendors’ websites (sample size:71).

6.“Global IT Robotic Automation Market,” Transparency Market Research,

www.transparencymarketresearch.com/pressrelease/it-robotic-automation-market.htm, accessed 22 October 2015.

7.Service delivery automation market in 2014, Everest Group study.

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5.2 Impact on marketplace
RPA-enabled outsourcing solutions automate repeatable, rule-based tasks and execute processes with less
human intervention in less time. The convenience and cost advantages are favorable to some industries,
while it negatively affects IT service providers.

RPA is good for industries struggling

to cut down their outsourcing
expenses as RPA can offer 25%–40%
labor cost savings.

For regulated businesses that

require a high level of compliance,
RPA also offers an effective solution,
as automated processes are less
prone to errors.

RPA adoption will not be positive for

most IT, ITO and Business Process
Outsourcing (BPO) service providers,
as this can negatively impact
existing contracts that are based on
resource utilization.

Economies such as India, that are

hugely dependent on the IT services
sector, will be severely affected.

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6. RPA delivery models

RPA delivery models

BPO service providers

RPA
Procured RPA In-house
technology End
technology developed RPA
pure customer
players

Robotics as a Service

Provides automation consultancy,

deployment and run services

Technology and BPO service Robotics as a

service providers providers Service
• They are typically • They are the • Robotics-as-a-Service
technology and existing IT and BPO (RaaS) is a service that
software developers. service providers manages clients’ robots
• They also help who develop RPA on a day-to-day basis.
companies implement technologies or buy • (i.e., an arrangement in
ideas to automate their technology from which it manages
business processes, third-party vendors. clients’ robots on a
maximize ROI and • They use it for their day-to-day basis on
provide onsite or existing operations their behalf)
offsite training and and deploy RPA
assistance. solutions for
external customers.

Note: this is not an exhaustive list.

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7. EY credentials
At EY, we have The Innovation Hub (TIH) asking not “what can we do with RPA?” but instead “what can we
not do with RPA?” Such questions help us drive more innovation into the market, pushing the boundaries
of RPA’s application.

EY’s automation engineers and automation process analysts help our clients in a number of ways. Some of
our biggest clients have chosen to team with our Innovation Hub to develop innovative applications of
technology to meet their specific needs. Since innovation is sometimes at odds with operations, this
separation from the business allows ideas to be developed into truly innovative solutions. And we become
an extension of our client’s innovation team.

The core of our service offering to clients is focused around RPA strategy development, proof of concepts,
implementations, managed services, COE design-build-manage and innovation labs. We have linked over
70 offerings that support clients throughout the RPA journey, which leverage our risk, tax, controls, PMO,
talent, change management and other offerings to maximize value and increase adoption rates.

Why choose EY?

We have the right “innovative” people
We help businesses to be “smart” enabled
Our multidisciplinary approach creates value
We have deep industry and process knowledge

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EY credentials

Case 1 Case 2 Case 3

• A global bank, sought to • The CIO of a global • A global insurer sought
use robotics to facilitate insurer sought to cost savings and
suitability reviews of establish a robotics-based efficiencies in an overly
product sales for digital engagement manual operations and
improving customer channel with consumers wanted to automate their
service • EY developed a labor-intensive back
• An automation software production grade office processes
was selected to automate software robotic solution, • EY delivered accelerated
the file (case) collation including overall process POC in six weeks (four
component of the review. design, interfaces and weeks build), which
• After automation, the interactions with existing included all key solution
client could reduce costs systems or web portals, components, addressed
by 50% for assembling calculation stages and technical risks, and
files and cases for review exception handling provided a robust
procedures business case, which
• File collation accelerated demonstrated the
by 2 months, providing • Developed showcase
materials and benefits of using software
improved customer robotics
service demonstrated POC to the
client’s executive board, • Developed and deployed
• Following a successful and business and IT software robotics
POC and production leadership solution, including overall
deployment, EY was process design, interfaces
asked to evaluate wider • After automation, the
client could achieve 98% and interactions with
usage of robotics across legacy systems and
the client’s operating automation of the
insurance claims exception handling
model procedures
submission process
• Productivity was • After automation, the
increased by a multiple of client could release 27
7.4 FTEs (25% of team)for a
51% cost reduction for
delivery of high-
frequency tasks

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About EY
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© 2015 EYGM Limited.

All Rights Reserved.

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This material has been prepared for general informational purposes only and is not
intended to be relied upon as accounting, tax, or other professional advice. Please
refer to your advisors for specific advice.

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