How Robotic Process Automation (RPA) and digital transformation work together

The use of Robotic Process Automation (RPA) is expanding rapidly across industries, geographies, and organizational sizes, with organizations chasing benefits including cost reduction, operations optimization, improved customer experience, fewer errors, easier management and control, and quick implementation and ROI. That’s driving increasing RPA spending: Gartner projects spending on RPA software to hit $1.3 billion this year, and Forrester forecasts a $2.9 billion RPA software market in 2021.

While an organization can certainly implement RPA without a full-blown digital transformation program, most digital transformation programs would not really be possible without the inclusion of some intelligent automation capabilities.

An RPA software bot replicates the way a human would interact with an application or system and then automates that task. For many organizations, implementing RPA is one of the first (and most straightforward) approaches to automation in their digital transformation journeys. “The ROIs are very compelling and fast versus some other longer-termed technology change programs,” explains Chip Wagner, CEO of ISG Automation, the RPA division of global technology research and advisory firm ISG.

While many organizations may initially view RPA as a simple automation tool or a short-term fix, it can be the catalyst for greater change as part of a broader digital transformation strategy.

“Most RPA deployments emanate from the need to automate manual, repetitive operational tasks, creating the impression that RPA is most effective as a tactical band-aid to IT system inefficiencies,” says Siddhartha Sharad, director of IT and business services transformation advisory firm Pace Harmon. “However, organizations generate the most value from RPA deployments when integrated with other digital technologies such as AI, machine learning, smart workflow tools, and digital assistants to drive end-to-end digital transformation.”

Examples of RPA use in digital transformation

“RPA can touch the back, middle, and front offices with dramatic reductions in cost, increases in speed, improved compliance, et cetera,” says Wagner. RPA can also relieve employees of their most mundane of their responsibilities, freeing them up to do more intellectually demanding work.

Many RPA solutions are beginning to integrate cognitive capabilities, increasing their value proposition.

RPA is not on its own an intelligent solution. As Everest Group explains in its RPA primer, “RPA is a deterministic solution, the outcome of which is known; used mostly for transactional activities and standardized processes.” Some common RPA use cases include order processing, financial report generation, IT support, and data aggregation and reconciliation.

However, as organizations proceed along their digital transformation journeys, the fact that many RPA solutions are beginning to integrate cognitive capabilities increases their value proposition.

For example, RPA might be coupled with intelligent character recognition (ICR) and optical character recognition (OCR). Contact center RPA applications might incorporate natural language processing (NLP) and natural language generation (NLG) to enable chatbots.

“These are all elements of an intelligent automati