What Is RPA? Robotic Process Automation Tech Guide In ’23

Hi there,

Have you heard about robotic process automation (RPA) yet?

RPA is transforming how modern companies operate by automating repetitive digital tasks. Global companies like Ernst & Young, Walmart, and American Express are using RPA to eliminate data entry, automate reporting, and process paperwork faster than ever before.

But RPA remains relatively unknown outside of tech circles. Many business leaders are unsure what RPA is, how it works, and whether it‘s suited to their organizations.

In this comprehensive guide, I’ll give you a crash course on everything RPA:

What RPA is and its key benefits
How RPA software bots automate processes
Real-world examples and use cases
Steps for implementing RPA successfully
Predictions for the future of RPA technology

Let’s get started!

What is RPA?

RPA stands for robotic process automation. It refers to software tools that automate repetitive, rules-based digital tasks traditionally performed by human workers.

RPA tools perform these tasks by interacting with user interfaces just like humans do. For example, RPA bots can log into multiple applications, copy and paste data between systems, move files, fill out forms, extract information from documents, scrape data from websites, and complete other repetitive processes.

According to research firm Gartner, the RPA software market reached nearly $1.4 billion in 2021. This is forecasted to grow to $2.4 billion by 2022 as more companies adopt RPA solutions.

Defining RPA

Let’s break down some key definitions of robotic process automation:

RPA per Wikipedia: “Robotic process automation (RPA) is a form of business process automation technology based on metaphorical software robots (bots) or on artificial intelligence (AI)/digital workers."
RPA per Institute for Robotic Process Automation: “The application of technology that allows employees in a company to configure computer software or a robot to capture and interpret existing applications for processing a transaction, manipulating data, triggering responses and communicating with other digital systems."
RPA per Gartner: “Robotic process automation (RPA) is a productivity tool that allows a user to configure one or more scripts (which some vendors call bots) to activate specific keystrokes in an automated fashion.”

While the wording differs slightly, all definitions convey the same point:

RPA utilizes software bots to automate repetitive, rules-based digital tasks traditionally performed by human workers.

This allows companies to reduce labor costs, improve efficiency and quality, and scale processes rapidly by leveraging automation.

A Brief History of RPA

The origins of RPA can be traced back to the early 2000s when the first screen scraping and macro automation tools emerged. However, RPA really gained popularity around 2010 when new vendors like Blue Prism and Automation Anywhere pioneered this technology.

These RPA platforms allowed companies to automate processes across multiple applications using simple drag-and-drop interfaces and bots that could log in and operate systems like humans. This provided a inexpensive automation solution compared to complex IT integrations.

RPA adoption accelerated in the 2010s as established software vendors like Microsoft, SAP, and IBM acquired RPA platforms. At the same time, RPA capabilities expanded from basic data transfers into automating full end-to-end processes using artificially intelligent bots.

This perfect storm of capability improvements and mainstream availability has led to RPA becoming one of the fastest growing enterprise software markets. And continual technology enhancements ensure RPA will become even more integral to business operations in the years ahead.

Benefits of RPA

Let‘s explore some of the main benefits driving businesses to adopt RPA:

1. Cost reduction

For companies with sizable workforces performing repetitive digital tasks, RPA delivers massive cost reduction potential.

According to Deloitte, RPA can reduce labor costs associated with manual processes by 25-50%. It also eliminates waste linked to human errors.

Forrester estimates RPA provides a payback period of less than 12 months for most implementations. This rapid ROI is accelerating adoption across labor-intensive industries like banking, insurance, and healthcare.

Case in point: T-Mobile automated thousands of manual processes using RPA and saved an estimated $200 million over two years.

2. Improved efficiency

By automating repetitive tasks, RPA enables processes to be completed significantly faster. Bots can process data round-the-clock without breaks.

RPA also removes workflow bottlenecks caused by constantly switching between applications and Windows. Bots seamlessly log in and out of multiple systems to automate end-to-end processes faster than humans can.

For example, Virgin Trains said RPA helped reduce the time required to process a refund from 4 minutes to just 30 seconds. That‘s an 83% reduction in processing time!

3. Scalability

Software bots allow processes to scale rapidly to meet fluctuating demands. If a workload grows, RPA tools make it easy to deploy more bots to handle the increased capacity.

This level of flexibility is impossible with manual processes reliant solely on human workers. RPA delivers virtually unlimited scalability to accommodate seasonal peaks and workload changes.

4. Consistency

Unlike humans who make occasional mistakes, RPA bots perform tasks consistently every time as per their programmed instructions. They do not get bored or fatigued if completing repetitive activities.

This consistency improves quality and reliability. Defect rates drop dramatically when manual steps are automated with bots.

5. Regulatory compliance

RPA provides detailed auditing and logging capabilities that support regulatory compliance. All actions performed by bots are digitally recorded and timestamped.

This provides the detailed reporting and documentation needed for processes subject to regulations. RPA enables transparency that helps demonstrate compliance.

6. New capabilities

RPA expands what is possible by allowing companies to efficiently automate tasks that may not have been feasible before. The technology enables new automation use cases through capabilities like:

Integrating complex legacy systems
Data scraping and processing
Automating across multiple interfaces
Operating 24/7 without human oversight

By deploying RPA to handle repetitive work, companies can also reassign skilled staff to focus on higher-value strategic projects that only humans can undertake. This drives greater productivity and job satisfaction.

How RPA Works

Now that we’ve covered the benefits, how does robotic process automation actually work under the hood?

Here is an overview of how RPA tools function:

1. Process analysis

Determine which business processes contain repetitive digital tasks that can be defined in rules and automated across multiple applications. Good candidates for RPA have high manual workloads ripe for automation.

2. Bot programming

Configure and program software bots to automate target processes using either coding or visual designers:

Coding interfaces allow developers to program bot logic and activities.
Visual designers enable drag-and-drop bot programming without coding expertise.

3. Bot deployment

Once testing is complete, deploy the bots into the live environment. Bots can run locally on user workstations or virtually through cloud platforms.

4. Process execution

The bots log into applications, extract data, complete work per programmed rules, integrate across systems, and log out. This automates entire workflows end-to-end.

5. Monitoring

Bots’ activities are tracked in a central console. Users can monitor progress, check for errors, view analytics, and control bot execution.

6. Maintenance

As processes change over time, bots can be reconfigured via coding or visual tools. This allows RPA to adapt to evolving business needs.

RPA tools handle the technical heavy lifting to deliver seamless automation across diverse applications and systems. This provides a scalable automation solution without the need for expensive IT projects.

Next, let’s go through some examples of RPA in action across different real-world use cases.

RPA Use Cases

Robotic process automation use cases exist across nearly every industry and department. Any repetitive digital tasks are candidates for automation.

Some common categories of RPA use cases include:

Data entry and processing

RPA excels at high-volume data-centric tasks:

Data inputs – Transferring data from paper forms and documents into software platforms and databases
Data transfers – Moving data between IT systems with incompatible formats
Data validation – Checking data for completeness and formatting issues
Data cleansing – Fixing data inconsistencies and errors

For example, State Farm uses RPA to extract handwritten data from medical claims forms and enter this unstructured data into their systems for processing. This automation handles over 30 million pieces of data annually.

Application processing

Bots can execute repetitive tasks within custom and packaged software:

Testing automation – Entering test data and validating results as part of QA
New employee onboarding – Creating accounts, assigning resources, enabling system access
Invoice processing – Data extraction, validation, routing to approvers
Claims processing – Assessing eligibility, validating forms, triggering payouts

American Fidelity automated new employee onboarding processes using RPA and achieved a 50% reduction in cycle times.

Reporting and monitoring

RPA tools gather data and generate reports automatically:

Management reports – Scheduled report compilation from multiple sources
Dashboards – Real-time status screens based on bots’ activities
System monitoring – Monitoring apps, infrastructure, and endpoints for issues
Compliance reports – Collecting compliance data across systems

Armed Forces Insurance automated over 200 regularly scheduled reports and saw reporting time drop by 60% to just minutes per week.

Workflow automation

Bots can complete start-to-finish workflows across multiple systems:

System triggers – Initiating processes by logging into apps and entering data
Document processing – Classifying forms, extracting data, routing for approval
Status updates – Sending notifications when workflow milestones occur
Record updates – Entering data in related systems after changes

Appian made their entire order-to-cash process touchless through RPA. This slashed processing costs by 75%.

As these examples demonstrate, RPA use cases exist across departments like finance, HR, IT, operations, and more. If your company still relies on repetitive manual processes, RPA likely presents opportunities to automate these workflows and boost productivity.

Implementing RPA Successfully

Based on the proven benefits and use cases, you may be keen to implement RPA within your own organization.

Here are best practices to follow for a successful RPA rollout:

Find the right processes to automate

The first step is identifying the best processes to automate with RPA. Look for:

Repeatable tasks: RPA excels at high-volume repetitive tasks. These are the prime automation targets.
Digital tasks: RPA can only automate processes involving actions within software interfaces, so identify digital workflows.
Rule-driven processes: RPA follows predefined rules, so seek structured processes with minimal exceptions.

Starting with simple repeatable tasks will allow you to demonstrate RPA‘s value quickly through a proof of concept. You can tackle more complex exceptions-driven processes later once the technology is proven.

Select the optimal RPA tool

With so many RPA platforms available, selecting the right software is crucial. Key selection criteria include:

Available training resources and vendor support
The right mix of development options – low-code vs. coding
Tool integration with your existing landscape
Attended vs. unattended bots depending on automation needs
Cloud vs. on-premise deployment models
Infrastructure requirements
Security and compliance capabilities

Seek a platform aligned with your developers‘ skills, IT standards, and functional requirements. Shortlist vendors that best fit your needs for testing.

Start small, then scale

The most successful RPA implementations start small with a pilot focused on automating a single critical process from end-to-end.

This focused approach allows you to:

Achieve rapid wins that prove RPA‘s value
Measure productivity gains, cost savings, and compliance firsthand
Refine your methodology based on lessons learned
Build expertise with the technology
Identify opportunities to optimize performance

With a successful pilot completed, you can then justify a broader rollout across the enterprise. Starting small limits risks and sets you up for enterprise-wide success.

Monitor bots and continuously improve

To get the most from RPA long-term, you need to monitor bots and continuously enhance performance. Steps include:

Monitoring bots in real-time using control panels
Tracking ROI and labor savings over time vs. targets
Improving existing bots with new scripts and logic
Adding more bots to scale processes as needed

Consider tools with AI add-ons that get smarter over time. The right platform will grow with your evolving automation needs.

Develop internal RPA expertise

Any game-changing technology requires internal skills development to be leveraged fully. With RPA, focus on:

Getting team members formally trained on RPA coding
Building an internal Center of Excellence to share knowledge
Using vendor expertise during the pilot and implementation phases
Creating playbooks and protocols to support bot management

Retaining RPA expertise in-house will ensure you maximize the return on investment from the technology over the long haul.

Following these best practices will set your RPA initiative up for success from proof of concept through to enterprise-wide deployment.

Future of RPA

RPA is already transforming how companies operate worldwide. But where is this exciting technology heading next?

Here are four likely RPA trends to expect:

More smart bots with AI

Today‘s RPA bots follow rules-based logic. But integration with artificial intelligence like machine learning will make bots smarter and more intelligent over time.

For example, combining RPA with optical character recognition enables bots to extract meaning from documents versus just processing them. This is the next evolution to smarter automation.

Expanded use cases

RPA will continue expanding across more functions as companies discover new applications for automation. Bots are also moving beyond just back-office to front-office processes.

Marketing, sales, and customer service will be the next functions to embrace automation. RPA will become a competitive differentiator across industries.

Democratization and low-code

Early RPA required advanced technical skills. But new low-code RPA options allow everyday business users to automate workflows with minimal training.

This "citizen automation" will democratize RPA and accelerate adoption across organizations as non-coders build their own bots.

Embedded smart applications

Today RPA exists as standalone software. But in the future, RPA bots will be embedded natively into enterprise applications to drive automation behind-the-scenes.

ERP platforms like SAP are already exploring this embedded approach. It hides complexity so users benefit from automation without needing RPA expertise.

As these trends demonstrate, RPA is in its infancy with significant growth and technology innovation ahead. This ensures RPA will only become more integral to how modern businesses operate going forward.

Key RPA Takeaways

Let‘s recap the key points covered in this guide:

RPA utilizes software bots to automate repetitive, rules-based digital tasks traditionally performed by human workers
Key benefits include lower costs, improved efficiency, scalability, consistency, compliance
RPA bots automate processes by logging in and interacting with multiple applications like humans
Use cases like data processing, workflow automation, reporting, and application testing are ripe for RPA
A successful RPA rollout requires finding the right processes, tools, piloting, monitoring, and building expertise
RPA is evolving with more AI integration and expanded use cases across industries

I hope this detailed introduction equips you to evaluate if RPA is the right automation approach for your own organization‘s needs.

As you consider RPA adoption, feel free to reach out if you need any help identifying use cases or building a business case. I‘m always happy to offer guidance!