As COVID-19 tore into business and operating models early in the year, the pandemic provided a spur for executives around the world to rethink their companies' automation projects. According to an EY report on mergers and acquisitions released in March, 36% took steps to change the speed of automation, 41% understood "the need to re-evaluate" it, and just 23% were fixed on the status quo.
Forward to July and in a poll conducted during the Association of International Certified Professional Accountants' Agile Finance Reimagined series of webcasts, "explore automation" was second only to scenario planning in terms of the strategies that finance leaders were considering or already implementing.
At London-headquartered global financial services company Legal & General, a finance automation project that started in 2017 with small-scale "concept automations" has made some progress during the pandemic, the company's automation delivery manager for process transformation, Gareth Williams, told FM. He explained that employees working at home, a demand for greater business resilience, and the ability of software robotics to work beyond normal working hours combined to dial up the need for automation (see the sidebar, "What Is Robotic Process Automation?"). "We expect there will be an increasing appetite for further automation activity going forward as business activity stabilises," he added.
Initially, however, as the company began to navigate the pandemic, existing plans to onboard new technologies and expand the IT team working on finance automation "naturally" took "a back seat", Williams explained.
Anastasia Fokina, ACMA, CGMA, is chief operations officer at Home Credit Vietnam. Previously, as CFO at Home Credit Bank in Kazakhstan, she led a project to automate cost control within the bank's procurement processes, which encompass the purchase of laptops and other IT equipment, marketing services, and even stationery. In recent months the need for this control — including facilitating timely payments without penalties — had accelerated.
Fokina told FM that the pandemic immediately revealed the deficiencies in automated processes — some semiautomated processes had proved cumbersome and had become "big obstacles". She added: "[The] control of ... processes when everyone [was] not in the office [was] becoming even more crucial. ... [We] just realised that we [had] to do it — everything — immediately. Once the pandemic hit, we immediately created workarounds to have a quick solution and started to work on full automation."
The bank's response was to adopt agile teamwork. "Instead of [a] top-down approach, [a] waterfall approach, we switched to agile mode. We asked IT to dedicate separate IT teams ... in order to accomplish the project very fast," Fokina said. All main end-user groups — commercial, HR, legal, operations, finance, and IT — were involved in user-experience testing, she added.
Fokina said the bank had earlier this year frozen hiring, except for new IT staff. This exception was an invest-to-save policy that was designed to reap post-automation benefits.
L&G's finance robotic process automation (RPA) project began in the fourth quarter of 2017 to reduce the need for manual, repetitive, nonjudgemental tasks. Successful "concept automations" followed. The choice of RPA technology — Blue Prism — was carefully determined by considering a range of available technologies and the types of business processes initially ripe for automation. "Blue Prism fitted our initial purpose and was already used within Legal & General, so it was a technology we were familiar with. We knew what benefits it could bring and had experience within the organisation to help us get things started, which was a great help," Williams said. Many of L&G's business divisions and processes are quite similar in terms of technology and process steps, he said, so knowing it was already working in some of the other business divisions made the decision easier.
The project's initial challenge was to "sell" how automation can complement existing finance operations, particularly to those not experienced with using the technology. "From the outset the focus has been on removing the manual, repetitive tasks to allow our people time to focus on value-added activities," explained Andrew Sword, senior project manager involved in the L&G automation project.
Non-IT staff who had not seen automation in action found it difficult to visualise software robotics' capabilities, Sword said. "That's why doing a small-scale concept automation invariably always opens up the door to further opportunities," he said.
Sword added: "We have overcome ... hurdles by ensuring the correct message is filtered from the top down and by showcasing some of our success stories across the business."
He explained that the automation team worked closely with other business units, bringing them on the automation journey. "We have a clearly defined flexible engagement model and delivery approach with teams who are new to automation or who already have an existing digital workforce [automation robotics] supporting them," Sword said.
He added that his finance team's close working with existing automation teams across the business ensured that best practice, which is constantly reviewed, was applied to the automation model used.
Williams quantified that around 25—35 virtual robotic "workers" with logins and email addresses and doing the repetitive tasks previously done by a similar number of humans have been deployed across the L&G Group and the L&G Investment Management divisions over the past two years. "This equates to approximately 40,000 hours of [human] manual work being processed by our digital [robotic] workforce annually," he said. The robotic workers cover a wide range of business areas and processes and sometimes operate 24 hours a day.
"These changes [involve] robots that save significant time, remove risk, improve speed of delivery, and improve employee and/or customer satisfaction," Williams added.
For the L&G automation team, the key lesson learned is to avoid doing too much at once. "Sometimes it's a better approach to quickly remove the high-volume elements of a process leaving ... small exceptions of a process to be completed manually [rather] than to spend every effort trying to fully automate the entire process and every scenario around it," Williams said.
Williams's, Sword's, and Fokina's further advice for management accountants starting on a finance automation journey includes:
- Gather support from the business leadership team. Naturally, people will initially be worried about automation and what it means for their future, so having senior support and getting the correct message across about why they support it is crucial.
- Ensure business expectations are set out upfront. Business involvement, including from legal or compliance teams, is needed through the development lifecycle. Spending time first with the business customer to get the design right will save time further down the line.
- Start small, learn, innovate, and adapt. Understand how automation could work in your environment and scale incrementally. You'll naturally build momentum quickly, which you can then capitalise on.
- Consider the risks and benefits. A more accelerated approach is likely to introduce a significant amount of risk into your operation and impact the cultural shift needed in the business. You may, however, deem the benefits to be worth the risk.
- Don't merely copy the legacy process when automating it. If needed, it should be redesigned and optimised before automation so that the same unnecessary steps are not replicated in the new process.
- Use the best tools for the size of your company. You may not need to implement expensive technology for making enterprise resource planning system automations. Consider more agile and less expensive tools that are available.
What is robotic process automation?
Robotic process automation (RPA) combines the ability to record and automate steps in a process with the ability to extend that automation across more than one application.
RPA can be described as a virtual robotic worker that drives processes across applications by performing tasks previously done manually by humans. For example, the robotic software can see when a project is completed in one application and automatically generates and sends an invoice seeking payment in a different application.
Software vendors have released a number of applications that allow users to program RPA software robots without coding knowledge. Some of the best-known vendors include Automation Anywhere, Blue Prism, Microsoft Power Automate (formerly Microsoft Flow), Pega, and UiPath.
Costs can range from free for certain "community editions" to five figures per user for developer licences. Prices vary widely even within vendors, but in general, Automation Anywhere and Blue Prism would be considered upper-tier providers while Microsoft Power Automate and UiPath would be cheaper options.
Oliver Rowe is an FM magazine senior editor. To comment on this article or to suggest an idea for another article, contact him at Oliver.Rowe@aicpa-cima.com.
- "Directing Change Management in Automation Projects", FM magazine, October 2020
- "3 Tips for Introducing RPA", FM magazine, 27 February 2020
- "How to Verify Vendor Claims and Manage RPA Deployment", FM magazine, 9 January 2020
- Digital Mindset Pack — Automation Focus
- Robotic Process Automation Fundamentals for Accounting and Finance Professionals Certificate Program
For more information or to make a purchase, go to future.aicpa.org/cpe-learning or call the Institute at 888-777-7077.