UiPath eyes integration prize, but customers still search for automation value

The Situation: UiPath is the dominant player in robotic process automation (RPA), but with its share price falling faster than leaves in the fall, it is desperate to carve itself a bigger role at scale across the enterprise. It tells customers and partners it is well-set to support the convergence of business and IT systems in a new era of automation in enterprise computing, in which it says automation is the application.

UiPath sees automation as the missing link in dealing with the fragmented quagmire of legacy and home-brewed systems, and it is banking on its platform being selected as the orchestration layer in the enterprise.

It hopes its investment in enterprise-grade capabilities embracing endpoint protection for bots, an integration service for APIs and bots, and investment in formal support for international compliance standards will give it the edge.

Our research in Exhibit 1 shows that most enterprises still want to realize the value of their emerging technology investments—automation included.

Exhibit 1: Realizing value from emerging technologies—including automation—is the biggest operational challenge for the enterprise

Sample: 2021 HFS Automation Survey, N=200 G2000 leaders
Source: HFS Research, 2022

More resilient bots, greater integration with APIs, and more support for low code

UiPath’s plans center on four pillars: Enterprise-Grade, Platform Expansion, Continuous Discovery, and Semantic Automation.

Enterprise-Grade is a response to automation running mission-critical processes in customer businesses. Investments have included “auto-update” for faster deployment, work on making bots more resilient through aspects of self-healing, and Automation Cloud and Automation Suite, designed to embrace serverless ways of working and provide near-instant performance elasticity.

Platform expansion is all about giving developers more capabilities to expand the range of solutions they can build. The focus here is on extending low-code/no-code and on the service integration UiPath offers to bring APIs and bots into processes requiring both. An API library with more templates and controls to support custom coding is coming soon, with “document understanding” being added to Studio X (the tool in which business users can create their automations). Further plans include investment in enhanced process orchestration and automation of the development and deployment lifecycle.

Integration promises better returns from process discovery

In Continuous Discovery, the commitment is to invest in making the outputs of both task and process mining more usable and valuable to the enterprise by integrating the outputs into the broader UiPath automation platform to help continuously monitor and understand where processes should be improved or initiated.

The fourth leg, Semantic Automation, is the most nascent, but it is likely the most compelling. Here, the intent is to increase the semantic understanding across the platform, giving context to both structured and unstructured data from which smarter decisions can be made and automated. For example, based on small sample sets, a document would be identified as a certain kind, and the context provided for the range of relevant next steps to action. If infused into bots, semantic automation would be able to extract the data and the context in which it was generated, and therefore the actions that should be taken.

The Bottom Line: Enterprise customers can benefit from the UiPath roadmap if the automation vendor stays focused on raising ROI on customer investments to date

There are positives for committed enterprise customers in the direction UiPath is setting, particularly in its investment in Enterprise-Grade, its focus on helping the enterprise find ongoing value from process and task mining, and moves to expand the platform. The integration of APIs and bots will prove essential and is a good example of UiPath listening and responding to the needs of its customers.

UiPath must extend its capabilities to grow its addressable market, but there is a risk that its grand ambition to become the platform of choice for the era of automation in enterprise computing could distract it from the current customer need of realizing more value from their investments.

In targeting integration, UiPath must consider how it co-exists with the likes of Workato, which arguably has more integration experience, and ServiceNow, with its “platform of platforms” ambition and head start in the IT realm. And that’s before global systems integrators weigh in with their deep pockets. UiPath must first focus on extracting more value from its customers’ automation investments, at least while so many enterprises feel they have yet to see the returns they hoped for.

Find out how UiPath performed in our SaaS XXV.