Point of View

Stop the prop! It’s time to stop propping up legacy and calling it transformation

March 10, 2021

2020 was the year that smart enterprises realized they had no choice but to migrate their core business operations into the cloud. While you can limp along for a little while with most of your staff working from home, your ability to operate at speed and access crucial data is significantly compromised if most of your firm’s operations rely on on-premise software and systems.

Net-net, we have a once-in-an-era opportunity to make rapid, fundamental changes to the way we design and run our businesses. But to achieve it, we need to be much more honest about our goals and objectives and what we are doing to achieve them. HFS declares we must “stop the prop!”—we need to stop propping up legacy and calling it transformation. As cheekily shown in Exhibit 1, if enterprises continue to invest in inherently short-term strategies that prioritize working cheaper and faster, we will continue to see the same incremental results that have plagued the past decade of so-called digital transformation investment. There is no direct path from cheaper and faster to digital transformation.

Exhibit 1: The vast majority of automation investments today focus on buying time rather than transforming business

Source: HFS Research, 2021

“Now” value is excellent, just don’t get stuck in the bottomless BS chasm

RPA (robotic process automation) is the perfect example of “now value” masquerading as transformation. We continue to invest in it because it delivers value—primarily helping enterprises extract more time from existing technology before the next major intervention. In some cases, writing off some legacy systems can be exorbitantly expensive. In many cases, RPA provides a great workaround to ringfence processes and keeps these investments at bay for some considerable time, which is hugely beneficial when finances are tight. There are more pressing challenges needing immediate investment.

But, this digital sheen on legacy tech lulls us into thinking we’re doing something transformative, but we may actually be stalling progress in the name of short-term gain. And be careful what you wish for. Numerous enterprises have shared that their short-term automation fixes have worked so well that their modernization initiatives have been moved to the back of the queue for broader digital investment.

HFS’s ongoing tracking of RPA and the broader process automation market has shown RPA moving from a pre-pandemic adoption baseline of a 13% in 2019 to the current view that about a third of enterprises have scaled implementations. Scale is tricky, though, because it implies something massively broad, but as enterprises so often remind us, scale is always a reflection of what you are solving. Thus, your two-bot deployment in a functional silo in a dark corner of your organization could be perfectly scaled for your specific needs.

Value is another slippery slope. As shown in Exhibit 2, we asked enterprises to weigh in on when they would see value from a range of emerging technologies. Process automation was at the top of the stack, with 34% of respondents indicating that they currently realize tangible value. The definitions of value included return on investment, topline growth, and productivity and efficiency measures. Tellingly, the biggest roadblock to achieving value for process automation was changing the organizational culture. “Now value” with process automation has played particularly well during the pandemic.

Exhibit 2: Process automation leads the pack for delivery of “now value,” but we need to honest about what that value represents

How long do you expect it will be before your organization will be able to see significant value or impact from investing in the following technologies?

Sample: 900 executives across Global 2000 enterprises Source: HFS Research in conjunction with KPMG

What’s critical is that enterprises do not get stuck. Digital transformation still must happen, and it starts with process reinvention underpinned by employees’ improved digital fluency and integrated, cloud-based enabling technology that leverages data and helps break down silos and push toward the OneOffice—all underpinned by a hefty ongoing dose of change management. This is how automation will become native and enterprises will increasingly become digital.

We must move past RPA (a product) to native automation (a discipline)

Any enterprise that’s worked with RPA for a year or more will attest to the fact that you generally need complementary tooling to help you get past task automation. The product evolution and M&A strategies of the major RPA players highlight this fact. Process intelligence will help you better understand processes before automating them and inform re-engineer-versus-automate decisions. Intelligent document processing tools will help you capture, extract, and classify unstructured data within documents. BI (business intelligence) capabilities will help you create dashboards to track and measure the performance of automation. Digital associates (HFS speak for cognitive chatbots) will help you navigate and effectively consume automation.

Together, this range of technologies coalesces to create the broader discipline of native automation that necessarily spans the Triple-A Trifecta of automation, AI, and analytics to drive end-to-end process automation and more expansive use cases. As we contemplate the concept of making automation a native element of enterprise operations, we must realize we are talking about a much broader purview of enabling technologies than RPA alone. As one automation marketing executive recently suggested, perhaps native is actually an acronym for “next automation technologies integrated very easily.” The magic is the mix. And this mix gets even headier when we align the more mature world of IT automation and the evolving discipline of AIOps with business-led process automation. This alignment is HFS’ OneOffice vision of cross-functional enterprise operations. Our stake in the ground on the tooling required to get there is depicted in Exhibit 3.

Exhibit 3: The OneOffice Emerging Tech Platform—powering collaborative cross-functional enterprise operations

The Bottom Line: It’s all lip service unless we change how work is done.

Long before emerging technologies can work their magic, the expectations for people and the processes they execute need to be re-evaluated and reinvented. This is precisely what the pandemic has laid bare. We cannot keep doing things the same way we always have. There is no going back. If we want to go forward and thrive rather than merely survive, it’s time to change how we get work done.

So—enough with the BS, let’s stop the prop! It’s time to stop hiding behind the short-term value of propping up legacy with RPA or any singular technology and calling it transformation. We need to make automation a native part of how we get work done. 2021 heralds the rise of reinvented, intelligent workflows managed by a digital service orchestration layer that cut across traditional silos, unleashing people and enabling their digital fluency and an active approach to doing work better. In a OneOffice organization, automation becomes a native competency, where human performance is augmented by unleashing creativity and personal interaction and where the immediacy of data creates insights to support decision-making that can make or break the firm. This is native automation in action.

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