Can humans and robots work together to improve the finance function? Rather than cause mass redundancies, robotic process automation (RPA) is set to drive efficiencies and enable humans to engage in more value-adding work.
At a glance
- Humans and robots working side by side will be a common feature of the future workplace.
- Robots in financial services are cost-effective and expected to reduce risk as they make fewer mistakes and work faster.
- Rather than cause mass redundancies, robotic process automation is set to drive efficiencies and enable humans to engage in more value-adding work.
Not too long ago, UiPath RPA technical sales consultant Ken Day implemented robotic process automation (RPA) in a client’s business system, and met a finance manager who would spend two days a week auditing a spreadsheet looking for errors.
The finance manager estimated that the work she did finding and investigating errors saved the business about A$200,000 a year, and she was horrified when Day completed the RPA implementation.
Where the office manager was only able to audit 10 per cent of the spreadsheet over two days, the robot was able to check 100 per cent and present anomalies for the finance manager to investigate.
“I can still remember saying, ‘Here’s the robot’, and then pressing the button,” Day told the CPA Australia Management Accounting Conference in August.
“She looked at me and said, ‘I’ve just lost my job’.”
Day and his team investigated, and discovered that because the robot was able to audit the entire spreadsheet instead of the 10 per cent achievable by the finance manager, her work doing the follow-ups was now worth A$1 million to the business.
“She looked at the numbers and said, ‘I like this robot’, and then her next question was whether we thought she should go and ask for a pay rise,” he says.
Day tells the story to illustrate his point: the advent of RPA will not destroy jobs and lead to mass redundancies in the finance industry.
Rather, it will minimise the drudgery of many manual tasks that are done today and improve the quality of work, while also finding efficiencies and value for the business.
Meet the robot
In future, he says, it will be commonplace for humans and robots to work together, and for work teams to be described as comprising “three people and two robots”.
The big difference is that the robot will be there 24/7, and “always do what it is told”.
“That bot might be working on your desktop, and start processing while you are working,” Day says.
“You’ll just press a button and send your robot off to do something while you do another job.”
“RPA is not a bandaid for a poor process. Our mantra is to give the human back the human. The way we do that is to look at any process that is digitised and how it can be streamlined and automated.” Jennifer Mitchell, Metcash
Robots in financial services are in many ways the best of both worlds, he says. They are cheap, and they reduce risk because they make fewer mistakes and work faster.
All businesses are likely to implement bots to some extent, says Day, and while the process and compliance benefits are clear, what is not so obvious is the change management: the way humans will come to terms with robots and welcome them into work environments.
One business that has done this is wholesaler Metcash, which works with independent retailers under the IGA, Mitre 10 and Cellarbrations brands.
RPA and the finance function
Jennifer Mitchell, a program manager at Metcash, presented the company’s case study at CPA Australia’s Management Accounting Conference.
The six-month-old RPA project is owned by the business and funded by the CFO, with a steering committee identifying opportunities that tackles the low-hanging fruit, such as reconciliations and data entry processes, that showcase how easy RPA is to implement, she says.
“Each time we improve a process and put in a bot, we tell the CFO as the sponsor, and he tells the leadership team. Our teams talk to each other; we have informal and formal, up-and-down stakeholder engagement.”
The mandate is to simplify and automate the low value and repetitive tasks.
“RPA is not a bandaid for a poor process. Our mantra is to give the human back the human, and the way we do that is to look at any process that is digitised and how it can be streamlined and automated,” Mitchell says.
“We say that any process that uses your fingers and not your head is open for automation. The result is that it’s an overzealous macro that does the work for you. It’s overzealous, but it’s very honest.”
Some of the savings, says Mitchell, have shown up how laborious processes can be, many of which were built on manual data entry to legacy systems that could not be integrated into current systems.
“For instance, we have saved two days a week on data entry for one team member by simplifying and automating a process,” she says.
The bots, which have been given names like “Chuck” and “Tradie”, are also cheap to operate and easy to implement, taking about four to six weeks from idea to functional.
“We have a pipeline of about 20 opportunities and we hope to do 30 projects by financial year 2020,” Mitchell says.
“That sounds a lot, but they are fast and easy to do.” The bots have been welcomed by employees, who understand that RPA is not about cutting costs, but is about saving time and adding value to jobs.
“We have really good people we really want to retain, and we won’t retain them by keeping their jobs boring,” Mitchell says. For humans, her judgement is that those who embrace the robots can make the transition positive. Like the finance manager in Day’s example, they just need to see where they can apply their best skills and become more proactive in their roles.
UiPath director of commercial finance – APAC and India, Anne La Fontaine FCPA says RPA is “changing the labour pyramid” in organisations and reducing the transactional level.
For people at the bottom of this pyramid, who have traditionally done labour-intensive work, this is truly an industrial revolution, which ultimately means they can find new value in their work and move “towards improving their contribution to business partnerships”.
She calls for people to adopt an “automation-first mindset”, which embraces change, and the idea of a “digital workforce”, which combines humans with robots to drive business outcomes.
RPA, she says, transforms where work is done, what work is done, and who does the work.
Critical elements of the finance function will continue and be enhanced by RPA.
“Independence, interpretation and judgement, all of these will continue,” she says.
“An automation-first mindset allows humans to do more data-driven analytics, and once you embrace that, it is a game changer.”
Explaining data to clients involves far more than just the data.
When an accountant sits down with a client to explain and interpret data, the reality is that the client is initially only taking in about 10 per cent of what they are being told.
Catherine Gillespie, managing director of consultancy Workplace Conflict Resolution, says that the other 90 per cent of the client’s attention is on the verbal tone and emotion of the delivery, with a full 50 per cent coming from a reading of body language.
“You probably think if your data and analysis is correct, your data should speak for itself,” Gillespie said at the CPA Australia Management Accounting Conference.
“I want to offer the suggestion that the data doesn’t speak, you are the one who is speaking, but you are doing so much more than speaking.”
Clients, says Gillespie, are strongly influenced by body language at the outset of any interaction. Is the person they are talking to making eye contact? Are they slightly turned away from them, playing with their watch or continually clicking their pen?
In responding to speech, clients are initially more focused on how words are said than on their actual content.“You are there to speak about the data, but before they hear any of that they are summing you up and they are trying to work out ‘What are you saying to me and what is your hidden agenda?’,” Gillespie says.
“The information that people take in and process instantaneously is the information they are going to take notice of first.”
Anyone in the personal services industry needs to understand their own style of communication and try and become familiar with that of clients. Failure to do this creates potential friction, she says.
The responsibility for managing communication and being sensitive to the differences lies not with the client, but with the service provider.
“Often we can be quick to blame the client, and say they lack perspective or don’t know the rules,” Gillespie says.
“These might have an element of truth and you can leave it at that, or you can take it a step further and take responsibility for the quality of the communication.”