hfs webinar slides: the 2017 rpa blueprint snapshot

The Services Research Company

The 2017 RPA Blueprint Snapshot

Webinar,February22nd,2016

PhilFersht,CEOandChiefAnalyst,[email protected]@pfersht #hfsresearch

TomReuner,SVP,[email protected]@tom_reuner #hfsresearch

©2017HfS Research Proprietary│Page1

Overview:• Industryanalyst,author,speaker,strategist,entrepreneurandblogger• 20years’intheglobalITandbusinessprocessoutsourcingandshared

servicesindustryspanninganalystandconsultingroles• Coinedthe“As-a-ServiceEconomy”in2014• Coinedthe“DigitalOneOfficeTM”in2017• Advisedandon100’sofglobalITservices,BPOandsharedservices

engagements• Overseasthelargestglobalnetworkofenterpriseservicesand

operationsprofessionals

CareerExperience:• FoundedHfSResearchin2010,overseeinganunprecedentedgrowth

storyintheanalystindustry• PracticeLead,GlobalITServices&BPOResearch,Gartner,Inc• GlobalBPOMarketplaceLeader,DeloitteConsulting• ConsultingPracticeHead,IDCAsia/Pacific• EuropeanITMarketsPracticeLead,IDCEurope

Education:• BSc.HonorsinBusiness&Technology,CoventryUniversity,UK• DiplômeUniversitairedeTechnologieinBusiness&Technology,

UniversityofGrenoble,France

[email protected]

@pfershtWeb:hfsresearch.comBlog:horsesforsources.com

Phil Fersht, Chief Analyst and CEO, HfS Research


HfS Research Has Been Writing About Intelligent Automation for 5+ Years

©2017 HfSResearchLtd.

C-SuitewantsOneOfficeintegration,predictivereal-timedataandspeedtomarket– whileaggressivelydrivingdowncostsHowcriticalarethefollowingC-Suite directivestoyouroperationsstrategy? (SVPsandabove))

20%

22%

24%

26%

29%

30%

31%

31%

42%

48%

46%

38%

55%

50%

45%

48%

48%

43%

19%

19%

17%

13%

17%

20%

15%

15%

8%

12%

12%

21%

5%

4%

5%

6%

6%

7%

Invest in cognitive technologies and machine learning to reduce reliance on mid/high skilled labor

Invest in process automation and robotics to reduce reliance on low-skilled labor

Policies that restrict the hiring of people

Improve the quality of operations talent

Scalable / Flexible services

Accelerate speed to market with new products

Create real-time data that supports predictive, not reactive decisions

Align middle/back office operations to improve customer experiences

Drive down operating costs

Mission Critical Increasingly Important Emerging Not a Directive

Source: HfS Research in Conjunction with KPMG, “State of Operations and Outsourcing 2017” Sample: n=454 Enterprise Buyers


C-SuiteDirectivesin2017:TechnologyDrivesTalent!HowcriticalarethefollowingC-Suite directivestoyouroperationsstrategy?(“MissionCritical”responses– allbuyers)

0%

20%

40%

60%

80%

Drive down operating costs

Accelerate speed to market with new products

Create real-time data that supports

predictive, not reactive

decisions

Align middle/back

office operations to improve customer

experiences

Improve the quality of

operations talent

Policies that restrict the hiring

of people

Invest in process automation and

robotics to reduce reliance on low-skilled

labor

Invest in cognitive

technologies and machine learning

to reduce reliance on

mid/high skilled labor

BFSI Manufacturing Healthcare&LifeSciences Retail Software&HiTech Energy&Utilities

Source: HfS Research in Conjunction with KPMG, “State of Operations and Outsourcing 2017” Sample: n=454 Enterprise Buyers


TheFutureofOperations:TheDigitalOneOfficeTMOrganization

Source:HfSResearch2017


Intelligent Automation is underway for well over half of $Billion+ Enterprises Whatisthemostimpactfultimingtobegintheseactions?

19%

18%

19%

20%

24%

21%

23%

31%

33%

33%

32%

30%

34%

34%

30%

32%

29%

26%

30%

28%

26%

15%

11%

13%

16%

12%

10%

12%

6%

6%

7%

5%

4%

7%

4%

Accomplishcreativeproblemsolving/"DesignThinking"

Retrainexistinginternaloperationstalenttoredesignprocesses

Investinspecializedchangemanagementsupporttoreorientoperationsstaff

InvestininternalITtalenttohelpusmigrateawayfromlegacysystems

Investineffectiveanalyticstools&skill

Identify/hireatransformationalleader/changeagent

Investinintelligentautomation

Now Withinthenextyear Within3years Within5years Never

Source: “Intelligent Operations" Study, HfS Research 2016Sample: Buyers = 371

©2017HfS Research Proprietary│Page8Source:BureauofLabor Statistics,HfSResearchAnalysis(datato2015)

Recessions destroy jobs, not robots…

-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

3.0%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

AnnualJobGrowthUS


[email protected]

Overview§ Tom Reuner is Senior Vice President, Intelligent Automation and IT

Services at HfS. Tom is responsible for driving the HfS research agenda for Intelligent Automation and IT Services. Automation cuts across the whole gamut ranging from RPA to Autonomics to Cognitive Computing and Artificial Intelligence. This includes increasingly the intersections of unstructured data, Analytics, and Cognitive Automation while mobilizing the HfS analysts to research Intelligent Automation dynamics across specific industries and business functions. Furthermore, he is supporting HfS’ push to disrupt IT Services research by focusing on application services and testing. A central theme for all his research is the increasing linkages between technological evolution and evolution in the delivery of business processes.

Previous Experience§ Tom’s deep understanding of the dynamics of this market comes from

having held senior positions with Gartner, Ovum and KPMG Consulting in the UK and with IDC in Germany where his responsibilities ranged from research and consulting to business development. He has always been involved in advising clients on the formulation of strategies, guiding them through methodologies and analytical data and working with clients to develop impactful and actionable insights. Tom is frequently quoted in the leading business and national press, appeared on TV and is a regular presenter at conferences.

Education§ Tom has a PhD in History from the University of Göttingen in Germany.

Tom Reuner, SVP, HfS Research


Automation Really is in the Eye of the Beholder


…and RPA is no Different

Other/Accessto

sourcingdecisions

CoreRPAcapabilities

Frontoffice

BPMERP

Productivitytools

RPApositioning


Understanding the Methodology behind the Blueprint

Market-led with sourcing focus, not functions and features

Input from partners, sourcing advisors, fellow HfS analysts and other stakeholders key

Evaluation across set of weighted criteria in execution and innovation; focus on enabling transformation and un-attended automation

RFI send to RPA providers

Expanding the research of HfS Intelligent Automation, building on Intelligent Automation Blueprint and RPA Premier League Table

Focus on “core RPA” not RDA or other adjacent capabilities; proprietary tools (EdgeVerve, SyntBots etc.) not in scope


Lessons and Insights from the Blueprint Research

DuopolyofAutomationAnywhereandBluePrism:Behindthetwomarketleaders,UiPathisgrowingstronglyandPega getsincreasinglyaddedtothemix.CongratulationtoalltheprovidersintheWinners’Circle!!

Itisabouttransformationstupid!Marketisshiftingtowardtransformationalprojectswithend-to-endperspective.Consultanciesandpure-playscomingtothefore.However,M&Alikelytoabsorbpure-plays

MovetowardCognitiveAutomationandAutomationEcosystems:Shiftfromearlynotionsofturn-keysolutionstowardbroadcognitivecapabilitiesandtheabilitytodemonstrateopenstandardsandecosystemsmindset

Datacurationiscritical:ApplyingCognitiveandmachinelearningsolutionstoIAandRPArequiresaccesstolargeamountsofrelevantdatatobuildreliablemodels

Warfortalent:AcutelackoftalentunderstandingtheimplicationsofRPAtechnologiesonprocesschainsandworkflows.Certificationsdouble-edgeswordastheymightaccelerateattrition

Smokeandmirrorsaddtoconfusion:TheconfusionaroundRPAvs.RDAsaswellasthelackofclarityastohowcodingandscriptingisneededfordeployments.Manyprojectsaresoldas”ManagedService„confoundingautomationproposition


The 2017 RPA Blueprint Snapshot


WorkFusion (and Commoditization) are Challenging the Fundamentals of RPA

IntelligentAutomation:VirtualAgents,DeepLearning,Self-remediation

RPAextension:Operationalanalytics,MachineLearning


The Future of RPA in 2017 and beyond

RPAwillremainundefined.Overthenext12months,theperceptionofRPAwillremainblurred.RPAcapabilitieswillfoldintobroadpropositionssuchasDigitalWorkforcesorCognitiveAutomation.

M&AthroughISVs.Buyerswillhavetodoscenarioplanningforacquisitions.Whilethismightbringbroadercapabilities,licensingcostsarelikelytoincreaseaswell.Pega’s acquisitionofOpenSpan isthetemplateforsuchdevelopments.

TheemergenceofAutomationEcosystems:WealreadyhaveseentheimpactofWatson,asitisstartingtoevolveintoanecosystem.ButitcouldequallybeoneofthetoolproviderssignificantlyexpandingitsreachAtthesametime,weareseeingproviderslikeBluePrismandUiPathbeingdeployedinIT-centricscenariossuchasITHelpDeskandApplicationManagement,pointingtoaconvergenceofscenariosandtoolsets.


Endgame: Vertically infused data and insights?!

Insights,Data

VerticalProcesses

Verticallyinfusedinsightsanddata

BPaaS,BPOas-a-stack,Industryplatforms.

Machinelearning,Neuralnetworks,Enterprisesearch,ArtificialintelligenceAnalytics


The Key Take-aways

§ While not clearly defined, the market for RPA is set to enter phase ofexponential growth

§ It is a question of where, how, at what scale and under which name§ RDA and proprietary tools not focus of this study§ AutomationAnywhere, Blue Prism, UiPath and Pega are the earlyleaders and educators

§ Service delivery is being decoupled from labour arbitrage§ RPA is morphing into Cognitive Automation§ WorkFusions’ free RPA move won’t disrupt the market,

but example for marketing savvy§ The future of RPA lies in service orchestration and

evolving automation ecosystems


Questions?


About HfS ResearchHfS ResearchisTheServicesResearchCompany™—theleadinganalystauthorityandglobalcommunityforbusinessoperationsandITservices.Thefirmhelpsorganizationsvalidateandimprovetheirglobaloperationswithworld-classresearch,benchmarkingandpeernetworking. HfS Researchwasnamed"IndependentAnalystFirmoftheYearfor2016"bytheInstituteofIndustryAnalystRelationswhichvotedon170otherleadinganalysts.HfS ChiefAnalyst,PhilFersht,wasnamedAnalystoftheYearin2016forthethirdtime.

HfS coinedtheterms"TheAs-a-ServiceEconomy"and"OneOffice™",whichdescribeHfS Research'svisionforthefutureofglobaloperationsandtheimpactofcognitiveautomationanddigitaltechnologies.HfS' visioniscenteredoncreatingthedigitalcustomerexperienceandanintelligent,singleofficetoenableandsupportit.HfS’ coremissionisabouthelpingclientsachieveanintegratedsupportoperationthathasthedigitalprowesstoenableitsorganizationtomeetcustomerdemand- asandwhenthatdemandhappens.WithspecificpracticeareasfocusedontheDigitizationofbusinessprocessesandDesignThinking,IntelligentAutomationandOutsourcing,HfS analystsapplyindustryknowledgeinhealthcare,lifesciences,retail,manufacturing,energy,utilities,telecommunicationsandfinancialservicestoformarealviewpointofthefutureofbusinessoperations.

HfS facilitatesathrivinganddynamicglobalcommunitywhichcontributestoitsresearchandstagesseveralOneOffice™Summits eachyear,bringingtogetherseniorservicebuyers,advisors,providersandtechnologysuppliersinanintimateforumtodevelopcollectiverecommendationsfortheindustryandadddepthtothefirm’sresearchpublicationsandanalystofferings.

Nowinitstenthyearofpublication,HfS Research’sacclaimedblogHorsesforSources isthemostwidelyreadandtrusteddestinationforunfetteredcollectiveinsight,researchandopendebateaboutsourcingindustryissuesanddevelopments.

HfS wasnamedAnalystFirmoftheYearfor2016,alongsideGartnerandForrester,byleadinganalystobserverInfluencerRelations.