Introduction

In the 1990s, ERP and shared services concepts fuelled the emergence and growth of centralized Finance and Accounting (F&A), Human Resources (HR), procurement, and other business functions. Since the turn of the century, offshore labor arbitrage has driven a new round of cost savings by lowering the human costs of performing the associated services. The use of offshore has begun to reach saturation with organizations looking for further ways to cut costs and achieve additional objectives, such as improved service, optimized processes, and reshoring. The next wave of cost savings is gathering pace and is increasingly focused on replacing manpower with technology in service delivery.

There is an emerging end-to-end process driven approach to F&A with increasing focus on consistency, delivery, and enterprise-wide integration. The increasing focus on consistency within processes and the continuous pressure on costs are driving automation in F&A.

This report first examines the broad area of Service Delivery Automation (SDA). Then, it delves into Robotic Process Automation (RPA), which is a subset of SDA, and its application in F&A. It provides a scenario-based business case for adopting RPA in F&A.

The analysis covers:

• Fundamental principles and definition of SDA and RPA
• Drivers for automation in the F&A segment
• The benefits of RPA
• An overview of the scenario used in calculating the business case for RPA
• Potential cost reduction due to off-shoring and outsourcing of F&A processes
• Potential cost reduction due to deploying RPA
• Impact of RPA in F&A

• RPA in F&A business processes, excluding any automation in the supporting IT services

Content

This report examines the benefits of using robotic process automation (RPA) in F&A. It takes a scenario-based approach to quantifying the major benefits of RPA and calculates the business case for the given scenario. In addition to that, it sets out a few fundamental principles and definitions for key automation technologies to help organizations learn and plan for this new development.

Following are a few highlights of the report:

Principles of SDA:

• Automation – at its most basic level – must utilizes technology to replace a series of human actions
• Much automation is already embedded in software systems
• SDA can be accomplished by combining multiple technologies

The market:

• Traditionally, F&A has had a functional focus but an end-to-end process-driven approach is emerging in the market, which promises more consistency, standardized delivery, and enterprise-wide integration
• At the same time, F&A outsourcing (FAO) value proposition is moving beyond labor arbitrage to drive business and/or strategic impact
• Technology has enabled organizations to increase productivity and performance. Today, it is helping organizations to generate savings through automation, going beyond the benefits of labor arbitrage
• RPA technology is emerging as the biggest disruptive force to drive benefits across multiple dimensions – cost savings, efficiency, accuracy, scalability, and compliance

The value proposition:

• Based on a common enterprise scenario, Everest Group estimates the cost benefits of offshoring F&A process
• Based on a common scenario, Everest Group calculates the business case for RPA, further reducing offshored F&A costs by 16% to 28%
• Barriers to adoption include concerns about cost of change, lack of knowledge about RPA, and getting locked in to a single technology provider