Tough economic climate drives automation

Is automation the panacea to the country’s economic woes? No, says Gary de Menezes, MD of Micro Focus South Africa, but it can help enterprises remain in business.

Johannesburg, 19 Aug 2019
Read time 6min 20sec
Gary de Menezes, Managing Director, Micro Focus South Africa
Gary de Menezes, Managing Director, Micro Focus South Africa

What’s driving enterprises’ automation strategies? It’s a good question. Stephen James Smith, Software Business Consultant at Micro Focus, says a primary driver is companies realising that they have a lot of inefficiencies as well as a lot of mundane tasks that need to be performed. “These become ideal places to investigate for the purposes of finding improved efficiencies. It’s all about the elimination of waste and the reduction of mundane tasks as well as a desire to eliminate human error – people become bored and lax when doing mundane tasks and this results in mistakes creeping in.”

Gary de Menezes, Managing Director at Micro Focus South Africa, says enterprises face two key challenges when it comes to automation: a serious shortage of skills in the IT sector in general, and the current economic climate. “We’ve seen an exodus of IT skills that just aren’t being replenished, and the financial situation means that today’s enterprises are having to do more with less.”

Another factor that’s driving the adoption of automation is that enterprises are being challenged by non-traditional businesses, forcing them to relook their cost to income ratios. Operating expenses (opex) are becoming a major factor in South Africa. De Menezes says: “The economic climate in this country is driving up the cost of doing business, with increased taxes and a higher cost of living, which means salaries need to go up. Opex keeps increasing and the economy can’t sustain it and companies can’t afford it.”

Smith says: “When you start improving efficiencies, you drive down costs. That’s a factor of automation, not a driver. Enterprises have to deliver more than they have the human capacity to produce, and that combined with the skills shortage is the biggest driver of automation. The IT world is becoming increasingly complex, with the introduction of the cloud and cloud technology. We lack the skills that these technologies require.”

The state of the economy is no secret: companies are downsizing, reducing their physical footprints as well as their staff complements. “They’re trying to reduce their opex costs,” says De Menezes. “The current economic climate is driving the necessity for automation in the enterprise.

“Enterprises are realising that they need to implement new initiatives to remain competitive, but in order to do so they require skilled people, who are in short supply, so they’re upskilling their existing workforce and automating whatever tasks they can.”

While robotic process automation (RPA) is suited to mundane repetitive tasks, automation is moving beyond the mundane. Smith says: “We’re starting to see intelligence built into automation so decisions can be made. A standard current process that’s automated has minimal decision-making involved, it’s a simple task that is done over and over again. An example would be an insurance claims submission. However, if you want to understand what people are doing and use data from various sources to make a decision around the process, then you require intelligence.”

This is why strong analytical capabilities are being integrated into RPA. “Up until now, the automation that’s been provided has been primarily focused on mundane activities and tasks such as call centre decision-making processes,” says De Menezes. “The future of RPA is to incorporate this intelligence to give the automation some decision-making capability, taking it to the next level. So, for example, the security operations centre is now becoming the security intelligence operations centre. We’re seeing intelligence being built in to solutions to remove administrative processes and low-level decision-making. And this is the next evolution of RPA.”

However, while intelligent automation is enabling enterprises to up their game and do more with less, not everyone is happy with the innovative capabilities. The ability to provide intelligent automation with facial recognition capabilities is starting to raise social concerns around the idea of big brother watching people. Concerns are coming to the fore around individuals’ lack of privacy as well as a dearth of personal space and time. People are so connected all of the time, which enables more and more data to be gathered about them. In Europe there have been calls to ban facial recognition cameras, which are viewed as an invasion of privacy.

De Menezes points out that as RPA spreads across the enterprise, it’s crossing over from the IT domain into the business domain. Initially, RPA was born out of a necessity to have simplistic software bots, with a typical use case being the call centre. “Now we’re seeing a link between business rules and IT decision-making, with business criteria impacting automation decision-making.”

The truly exciting thing about today’s automation tools is the creativity and new use cases that they’re going to enable because of their inbuilt capabilities and because they can integrate with processes across the enterprise. Smith says: “If you consider that when computers first made their arrival, their use cases were very limited. Industry provides the tools and people’s creativity will come up with interesting and innovative applications, especially when intelligence capabilities become more pervasive.”

Going forward, Smith says the notion of intelligence and automation will move into the political and legal realms as people will firstly want to understand the implications of what the technology can do, and secondly, they’ll want to draft legislation around the kind of issues that could arise because of it.

There have already been instances where data privacy and automation have conflicted, with some large enterprises attracting fines for inadvertently exposing people’s personally identifiable information. Legislation like Europe’s General Data Protection Regulation and, closer to home, the Protection of Personal Information Act, are in place to protect people against the potentially negative side-effects of automation.

However, the pros far outweigh the cons, says De Menezes. “Automation has a lot of positive use cases. When you consider the widespread corruption that we read about daily, automation could play a huge role in weeding out corrupt practices. For example, if social benefits payments processes were automated, there would be far fewer fake profiles receiving payouts. It could also be used to flag unusual transactions for the country’s revenue service. The applications are only limited by the imagination. And much like any other tool, it can be used for good or bad. What you use the data for is still a human decision.”

Every enterprise will essentially be a software company, according to De Menezes. “If your business isn’t a software business, regardless of what you sell, you’ll be at a disadvantage to your competitors. Software drives everything and it underpins everything.”

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