Digitalization & automation driving transformation
Traditionally, business services drive efficiency by processing large volumes of standardized work. This environment creates the opportunity for introducing large-scale digitization and new technologies to increase efficiency and reduce service costs.
Centres are often pioneering new technologies that are later adopted by the rest of the parent company, even while leveraging them to enable broader service options and greater value delivery to the organization. As innovation and digitalization rates increase, so does the pressure to integrate technology solutions.
The growing digital workforce must be managed by an increasing number of automation experts. Over the last 2 years the number of the automation experts operating within the sector has almost tripled. The centres further plan to expand their automation teams by 60% within the next 3 years.
Where do the automation experts come from? 70% come from the centres themselves. More than a half are a part of in-house teams trained within the centre and additional 19% of the capability is built by allocating the robotics projects to existing roles within the company. This shows that the centres are essentially becoming automation innovation and training hubs.
“The responsibility for finding the technologies and tools that international companies need to develop and operate is increasingly being taken over by the service centers themselves. This is one of the reasons why their share of positions related to IT, research and development is growing.”
Finance & Accounting is reported to be the most automated area, in which 85% of the centres have already implemented automation on some processes. On average, 24% of processes have been automated within F&A – most commonly scanning of invoices, AP/AR or reporting.
IT Services show a great potential for further automation, since the centres report on average 21% of processes within IT being automated (such as automated approvals, ticket management or helpdesk).
Use cases of activities performed by automation within that area
- Scanning of invoices
- Accounts payable
- Accounts receivable
- Payment matching & validations
- Cash applications
Artificial intelligence is being increasingly implemented especially in HR, F&A or notably Customer Operations, where 24% of the business services centres have already implemented AI on average on 11% of their processes. These tend to be chatbots, however, other use cases for AI within business services include invoice processing, talent management or performance review.
The two most common methods of automation implemented and planned to be used in business services are Robotic Process Automation (RPA) and Optical Character Recognition (OCR). However, the ABSL Survey 2020 shows that in the upcoming year a significant increase in the implementation of Machine learning, Artificial intelligence and Chatbots can be expected.
The surveyed centres continue to report that the main obstacle to an effective automation strategy are processes and systems, which are not sufficiently aligned and standardized. This is a crucial obstacle to overcome since automation is identified as one of the key tools for the business services to transform into high-productivity GBS hubs.
Automation brings several benefits to the company, but the main focus continues to be on employee engagement. The reduction of manual workload frees up the time of skilled workforces to develop into the automation experts or higher-value workers, which the centres need on their journey towards becoming partners of the parent company.