Automation is a critical enabler of efficiency, innovation, and competitive advantage in a business world increasingly defined by digital transformation. However, the path to effective automation is not indiscriminate adoption but strategic alignment.
For financial institutions navigating today’s evolving digital transformation landscape, adoption of automation technologies is pivotal—and they know it. In 2023, financial services organizations universally embraced some level of automation, and an ambitious 61% of businesses are gearing up to expand their automation investments in 2024.
Forward-thinking businesses understand that automation is not merely an operational nice-to-have but a strategic imperative. However, the proliferation of automation solutions—and, in turn, the rapidly expanding automation lexicon—has made it more difficult for organizations to decipher which technologies address their unique objectives. So, although the diversity in organizational needs, business functions, existing systems, and strategic priorities necessitates a bespoke approach to automation, leaders must grasp an understanding of acronyms like iPaaS, RPA, BPA, WLA, and SOAP before developing a comprehensive strategy.
Sorting the Automation Alphabet Soup
At the heart of the automation puzzle is the need for clarity around each technology’s purpose and how it fits into the broader organizational tapestry. The road to transformation is paved with unique acronyms and specialized terms; leaders pursuing automation as a strategic differentiator must aim to keep up with the latest technologies and their functionalities.
- Integration Platform as a Service (iPaaS) offers a seamless solution for integrating disparate applications and data across various environments. It acts as a bridge, ensuring fluid communication and standardized data flow between different systems, whether cloud-based or on-premises. iPaaS emerges as a central hub, simplifying complex integrations and empowering organizations with agility and enhanced data usability. This technology is particularly valuable for sectors struggling with legacy system integration, offering capabilities such as real-time data sharing and process automation across different platforms, enhancing operational agility and data usability across the board.
- Robotic Process Automation (RPA) focuses on automating repetitive, high-volume tasks. RPA bots execute tasks with unmatched efficiency and accuracy by mimicking human interactions with digital interfaces. This automation accelerates operational processes and eradicates the mundane, freeing human resources to engage in more strategic, value-adding activities. RPA is deployed to automate data entry, process standard transactions, and manage data validations, leading to significant improvements in efficiency, accuracy, and cost savings. This can include customer onboarding and account opening, loan processing, accounts payable, fraud detection, employee onboarding and offboarding, and more.
- Workload Automation and Orchestration (WLA&O) transcends simple task automation by offering a holistic suite for automating backend processes and transactions. It eliminates the need for continuous IT oversight by leveraging complex schedules or event-driven triggers to ensure smooth, efficient workflow execution across various applications and systems. As a result, the benefits of WLA&O can include increased efficiency across departments, reduced workflow turnaround time, fewer delays or errors in end-to-end processes, greater forecasting capabilities, reduced IT operating expenses, increased batch processing, and reduced server needs.
- Business Process Automation (BPA) streamlines critical, multi-step processes involving extensive information transfer and collaboration across departments. By automating these complex workflows, BPA significantly reduces processing times, minimizes errors, and enhances the reliability and consistency of business operations. BPA can be used to improve organization-wide collaboration, integrate cloud-based applications within a common workflow, automate the otherwise cumbersome transfer of information and files between several departments, and improve member and customer experience by making business processes more efficient, consistent, and reliable.
- Intelligent process automation (IPA) is an enterprise-wide process and workflow redesign used to improve business performance using technologies, including task-level workflow processes and the heavy use of business data and analytics for decision-making. In other words, IPA is the combination of RPA and artificial intelligence. For example, IPA can automate credit assessments by incorporating analytics and data insights to evaluate creditworthiness accurately.
- A service orchestration and automation platform (SOAP) enables IT to design and implement business services through workflow orchestration, workload automation, and resource provisioning across an organization’s hybrid digital infrastructure. SOAPs combine all the functionality and features of a workload automation (WLA) solution with additional capabilities that enable even greater operational efficiency and automation management. Various use cases include event-driven automation, workflow orchestration across a hybrid IT environment, workflow monitoring and alerting capabilities, citizen-led or self-service automation that enables automation for those outside of IT, and extract/transform/load (ETL) capabilities to pull data and upload it to a data warehouse to be read and analyzed.
See also: 5 Best Practices for Maximizing the Value of Your RPA Implementation
Crafting a Tailored Strategy
The journey toward automation excellence requires more than a cursory understanding of available technologies. It demands a strategic approach to aligning technology investments with business goals. Here are critical considerations for businesses looking to navigate the automation landscape:
- Assess Organizational Needs and Priorities: Thoroughly analyze your organization’s needs, challenges, and strategic objectives. Identify processes ripe for automation and consider how different technologies can address those needs.
- Understand the Scope and Scale of Automation Technologies: Dive deep into what each technology offers and its best use cases. Consider iPaaS for integration challenges, RPA for last-mile task automation, WLA&O for backend process automation, and BPA for streamlining complex business workflows.
- Evaluate the Technological Fit: Assess whether the selected automation solutions seamlessly integrate with your existing tech stack. Consider the adaptability of these technologies to future changes in your business environment and technology landscape.
- Consider the Human Element: Automation is as much about people as technology. Evaluate how each automation solution will impact your workforce and aim for solutions that augment human efforts, enhance job satisfaction, and foster a culture of innovation.
- Plan for Scalability and Flexibility: Choose automation technologies that can scale with your business and adapt to changing needs. Flexibility is critical to accommodating future growth and navigating the evolving digital ecosystem.
Becoming an Automation Expert
Automation is a critical enabler of efficiency, innovation, and competitive advantage in a business world increasingly defined by digital transformation. However, the path to effective automation is not indiscriminate adoption but strategic alignment. As financial institutions ramp up their automation investments in 2024, they must emphasize selecting the right mix of technologies that align with their unique needs and goals.
The journey from understanding to effectively implementing these technologies requires a thoughtful approach, emphasizing aligning automation strategies with business objectives. By doing so, organizations can unlock the full potential of automation, not just as a tool for operational efficiency but as a cornerstone of strategic business transformation.
