The challenge of building a responsive and high-growth business fit for the digital age, at the same time as optimising costs, is one all insurers are grappling with. Until recently, balancing lower costs with improved customer experience simply didn’t add up. But now, insurers are turning to artificial intelligence and automation technologies and, in particular, Robotic Process Automation (RPA), to transform the art of the possible and rebalance the equation between cost and service.
That’s because RPA’s ability to execute manual back-office tasks can liberate resources to focus on higher-value, customer facing roles. RPA works best handling rules-based, repetitive and high-frequency tasks such as application handling, claims processing and data entry. Insurers across personal and commercial lines, for example, have set in train pilot projects demonstrating sizeable benefits. These include a 40% – 80% reduction in processing times as well as improved quality, auditability and better risk management. RPA also enables new digital technologies in the front end to integrate with legacy back-office systems, accelerating the pace of digital adoption.
All this is good news. However, the most successful organisations understand that along with the new opportunities RPA opens out, there are also limits to how it can be used. While management teams are understandably excited about RPA’s possibilities, it’s essential that their enthusiasm is tempered with a clear picture of how RPA is best deployed. That’s why when it comes to assessing a specific process’s suitability for RPA, leading organisations are not only asking “can we do it?” but also “should we?”. Not all processes are suitable. Each opportunity requires careful assessment. Isolated projects tend to struggle with achieving buy-in and integration with the wider organisation. A strategic approach is needed.
An effective RPA strategy needs backing from the top of the organisation. The business must engage in identifying the most suitable candidate processes. Operations and IT must collaborate effectively and work with clear responsibilities. And, just as important, is managing the ‘robotic’ workforce on a day-to-day basis, measuring its productivity and assessing performance against SLAs to drive continuous improvement.
Managing the human workforce whose roles may change as a result of RPA is critical. RPA will reduce back-office work. But it needn’t be seen as a threat. If presented as a way to offer people more rewarding, engaging work it’s more likely to be seen in a positive light. That’s the approach taken by one UK-based general insurer. By taking time to make RPA an integral part of the team – and even giving robots names – management was able to shift perceptions from RPA as a threat to its acceptance as a valued part of the team focused on building business value.