Automation is Back with a Bang!

Sustained energy and a renewed commitment to enterprise automation are evident, as more than 500 Fortune 2000 executives revealed in an HFS research study conducted in partnership with Infosys. Let’s take a look at some of the key findings:

Big post-pandemic rebound for Automation. COVID slowed automation initiatives for 65% of respondents and caused some reprioritization for IT resources. But today, over 70% of respondents say that automation is now an increased priority with stronger C-suite sponsorship.

Enterprise leaders want digital modernization, but Automation is still too focused on cost and efficiency. Over 75% of respondents reported cost, efficiency, and productivity among the top 3 objectives for Automation. When the vast majority of projects are simple or moderate and measured with efficiency and cost metrics, that is what they produce. This is the disconnect: What business wants is growth and revenue, but Automation is predominantly serving up a lower cost.

C-Suite wants business impact with Automation, while middle-management focuses on productivity. The C-Suite is overwhelmingly clear they want to see significant improvements in business outcomes from automation initiatives (73%) compared to their middle management peers running the engagements who are more focused on productivity measures (64%). The C-Suite also is more concerned about the positive impact on employees, such as freeing up their time to focus on higher-value activities (51% compared with 42% of middle management).

Headcount reduction with Automation has lost relevance. Where both leadership and middle management agree that headcount reduction is a relevant outcome of Automation, with only a fifth seeing this as a measurement of success.

Automations are now at a serious investment level. 25% of companies are spending more than $25m per year on automation initiatives. 49% of total investment is in services (51% in product). Three quarters are planning to increase investment in the next 12 months.

Automation has now become a lot more than merely RPA. RPA is the most common automation tool, but investment is up across the board in process mining, digital assistants, natural language processing, intelligent document processing, machine learning and even deep learning.

The software makers are failing to deliver customer success. 87% respondents say that more value is needed from current investments. Only 6 in 10 initiatives are meeting expectations. As much as 60% of purchased licenses are sitting as shelf-ware.

Enterprises are adopting more meaningful success metrics. We aren’t talking about the number of bots deployed or headcount reduced nearly as much. Good measurements are available for a variety of far better metrics like IRR, working capital, days outstanding, net promoter score or cost per transaction.

Staff are adopting and embracing Automation like never before. But talent crunch is the #1 issue. Internal development and training are the primary response, external hiring next and using gig/3rd party service providers third to meet the talent crisis.

The C-suite is taking sponsorship seriously and mandates are handed out. The IT and ops execution teams are aligned. The problem lies in a clear lack of accountability.

Majority of automation leaders are only at the start of their journey. 70% of respondents self-rated themselves as automation beginners. Only 9% emerged as automation champions and offer vital lessons to drive success.

Over 30% of clients have reported lack of Organizational clarity, accountability, governance, and required investments to scale the Automation initiatives, as impediments to meeting C-Suite expectations

The Bottom Line: Until we get over this notion that Automation is a thing we must go DO, it will never become the WAY OF DOING that it can become.

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