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Automate Everything® – the new cupid for BPOs

Business Process Services

September 7, 2020

CIO Talk – Hexaware Blogcast: Welcome listeners!…This is Sanjog, your host, and the topic for conversation is Automate Everything® – The new cupid for BPOs

Many business process outsourcing (BPO) companies and enterprises have explored automation for their operations; they have done that in silos, automating only a few tasks or processes at a time. There are complex challenges that hold them back from bringing together human and digital workforce (bots with brains) to run smarter operations. Hexaware claims that Automate Everything® is the new cupid for BPOs which can help them achieve end-to-end enterprise wide automation to drive strategic benefits and maximize straight-through processing (STP). But what is Automate Everything®? Is it a framework, a mindset, a suite of services, or a technology solution and can Automate Everything® actually deliver as promised?

Chinmoy Banerjee is the Executive Vice President and Business Head at Business Process Services, Hexaware – a consulting firm focused on transforming IT solutions and solving complex business problems using a combination of human creativity and intellect. Their three-pronged strategy of Automate Everything®, Cloudify Everything® and Transform Customer Experiences® enables enterprises fast track into the digital era.

Sanjog: Hello Chinmoy! Thank you for joining us.

Chinmoy: Thanks for having me.

Sanjog: You are a BPO company talking about automation. Wouldn’t more automation lead to fewer of your people serving a customer, thus lead to a revenue loss?

Chinmoy: It is a great question to kick this off. And incidentally, a BPO leader talking to a CIO Talk Network Host, something that BPOs usually don’t do given their focus on the COO and CFO world.

Well first off, we aren’t just a BPO company. We are a technology company solving business problems through the lens of CX first and using levers of automation and cloud. And certainly, there are various services internally aligned to solve said client issues. As from an internal perspective, I am the leader for the BPO business and have GTM responsibilities for automation. Externally as Hexaware, we are focused on certain industry verticals solving business problems like why do you have lower STP rates in reconciliation or payments, or why does someone have Daily Sales Outstanding higher than industry.

Now back to your original question – why talk about automation when it leads to lesser people servicing a customer and so leading to revenue loss. In 2020, automation and the talk of it is literally all pervasive and ubiquitous. In 2015, when Keech, our CEO decided that our strategy will be to lead with automation and do the best for our clients it was not so common, very uncommon in fact! And we persisted knowing that it would lead to cannibalizing our revenues. We felt that doing this would lead to loss in terms of revenue in the near term but clients would see what we are doing and act as great referrals for us and either give us more work or enable us to get more work from other clients. We enabled this at the ground level by changing culture. Qualitatively we said that people who come up with automation ideas and executed on them are MVPs and more valuable than people who just managed large teams. The culture of, I am important because I have 100 people working for me was systematically targeted by us. Our BUD channel on YouTube, give a lot of pointers on how automation works. BUD, which stands for Bottoms-Up Disruption, shows practical ideas implemented that generate almost all our transformation savings. Quantitatively we enabled it by saying cannibalizing your customers revenues will not be penalized when your growth targets are measured. And we are enabling all of this through providing colleagues with an ability to upskills through methodical continuous training programs. So essentially as a BPO and Tech company when we look at automation, and when we know automation will lead to fewer of our people serving the customer in the short term, it is best thing to do for the customer and essentially for us in the long run.

Sanjog: What does Hexaware mean when you say Automate Everything®?

Chinmoy: It literally means that. Automate everything® that can be automated in a business. It contextual, conceptual and directional – it is a way of thinking. And the thinking behind Automate Everything® has evolved as well over the years and across different businesses. Examples abound – from RPA used to automate certain processes… to BPM tools used in other situations, test automation which has been prevalent for a while, to automation across IT ops, ASM and Infra to now CX automation including the use of virtual agents. These are all happening across enterprises at various levels of maturity and adoption. The first intent for us when we say Automate Everything is to look at automation in as much of a holistic manner as possible across all the above layers – Ops, testing, infra, apps, data, CXT and using all the levers or tools that are best in class at that point in time. Our POV includes for example a 6 by 6 that explains this in great detail. Especially, on Automate Everything® we want to call out Data and Analytics: Data is now available in vast amounts due to digital transactions, IOT devices, social media etc. and customers need to establish automated processes, and our Automate Everything approach treats data as a fundamental layer to drive better insights, operational analytics, using ML/AI and ultimately drive business value for customers. Process data is coming through process mining tools to automatically discover, enhances target state processes.

Again, it’s not an easy best practice to do because clients structures are not aligned. COO/CIO/Infra heads are all running their own organizations and not talking together. And we feel looking at all of this holistically and integrated manner has tremendous value. The offshoot of that we will look at a process end to end, not just the front office or back office therefore looking at increasing STP rates holistically. Most organizations today are far away from even the 80% mark. Unless you are in BFSI where the rates are much higher. So, the opportunity to look at STP is much higher.

The second principle is that all things being equal we should look at automation continuously. Not automate for the sake of it but automate if it brings business value and then create more digital workforce and make it a virtuous cycle of continuous improvement and continuous cannibalization. Create a virtuous loop if you will.

The final point on Automate Everything® is we will always use best in class products and not get tied down to only homegrown tools. We of course prefer to work in partnerships with certain products across the various dimensions of automation but the intent is to evolve; the philosophy of Automate Everything® is to evolve and continuously keep clients interest in minds and stay on the path of continuous improvement.

Sanjog: How do BPO operations and your core idea Automate Everything® goes hand in hand?

Chinmoy: It is an interesting question of course with BPO and automation seems like a bridge which is little too far to cross. But, even when we look at a deal which is just BPO, we see today deals are somewhere embedded with technology whether it being an asset, or it solves some problem.  When we look at BPO overall, our point of view is that:

  • We look at firstly identifying the business problem and the risks associated with the process. Even though the customer is looking at right shoring and cost efficiencies, we insist on looking at the business problems first. Identify the business problems and the risks associated with a process.
  • Then we see what do the clients actually want. And in most places, it is indeed the client’s client which is the relevant party if one wants to understand what they actually want.
  • Then we look at moving away from looking at Ops in silos. By that I mean that the client might be actually wanting to do BPO just for the back office, we insist on looking at it end to end and taking processes that are not a part of the scope for outsourcing. But it is very important to look at the processes end-to-end whether its front office or back office. Ops and IT have to be looked together and not looking at them separately even though it is just a BPO engagement. And all of this happens when we are assessing the deal in the initial stages itself during the due diligence phase and not after the deal is done. Move away from looking at Ops and IT in silos. And don’t look at segments within IT as well! Starts with assessment and DD phase itself and not after a deal is done
  • Then of course we have to provide cost benefits, but almost make that secondary. BPOs, in our point of view, should be expertise led that truly brings in more business efficiency and more domain in it.
  • Looking at Automate Everything®, what it does mean for the customer. For example, does it bring in more flexibility in a BPO contract. Examples could be it is not just people based or FTE based pricing but actually outcome-based or transaction pricing. You have heard this term “Gain Sharing” for many years and it gets tough or falls down because loss of transparency or because it is not a true partnership. Again, we feel, Automate Everything plays very well with transparency and “gain sharing” as a concept.
  • We will look at it as an expertise led resource mix rather than the usual pyramid structure. Actually, BPOs today are run by people who run people. So, we would want to look at people managers as the concept of the past. Nix the people managers and everyone from the top downwards including someone like me who runs the BPO as a business be an expert in some area across our BPO offerings. So big change in today’s culture because if you look at all the marketing talk of the billion-dollar BPOs and if you skim through that it is about people running people.
  • And finally, when we look at Automate Everything®, we would want to look at how does it drive business efficiency and how does it actually drive revenue enhancement. Not just saying from a business efficiency perspective, can I help you increase your working capital but also saying as a service unit for the customer actually generate revenue for you and maybe even make the billing paid to me redundant because I am able to generate revenue for you in addition to the cost savings.

All of this, we feel bring Automate Everything® and BPO operations hand-in-hand and ultimately we provide a sustainable service that can only come from an automation led approach.

Sanjog: It’s a fascinating concept. How well does it or did it work in real life? What were the lessons learned for you and your customers during these real life tests?

Chinmoy: Well its certainly is fascinating and we arrived at this as an evolution and its still evolving. All good things absolutely need to evolve. We were lucky in 2016 to have started this by cocreating with some of our anchor clients. We initially started this off with something called Digital Managed Services which essentially brings together operations and automation. And we started working with a bank who at that point had a bunch of stuff in the payments area with over 100 people delivery unit in 2016. And we said, hey listen, we can take the 100 people that are servicing payments work for you in a vendor situation and a low-cost location like India and actually using automation, get it down to about 50 odd people and 20 odd BOTs. So that is how we started our journey using Digital Managed Services as a construct. But that was very well received by bunch of banks and customers, because if we were giving something like that, we were unlocking value which is over and above labor arbitrage that a BPO has done over many years so far.  But that was a PBJ –peanut butter jelly sandwich kind of an example, we brought together a few concepts, build a package that really excited customers. But with Automate Everything® we are trying to create something like the Pizza, which was revealed to the world by Italy. It is the same pizza with core ingredients that have been around for a while, but it is really pushing the frontiers even more. And this is more challenging and there are lot of lessons learnt. Sharing few of them through examples:

  • Creating the cultural awareness is key. This is super critical. You cannot impose the model on your teams and certainly not on the clients and most difficult is on the analysts who all are comfortable managing deals using the same old excels that ask how many 1000’s of people you have and how many millions of units do u possess. Big learning is fixing the cultural awareness in your team itself is not enough; you have to evangelize the concept. Innovators indeed have to ply a lonely road!
  • The commitments in transformation suffers on the ground due to lack of synergies between Ops and IT. And we see this in most of our examples – for an Insurance customer for example we said, we will transform but the operations guys had a different idea on the processes that they want to automate and the technology (in this case, RPA) they want to use, but we figured once we started that the technology guys did not want to use RPA and wanted to fix the platform. Therefore, managing change is equally important which seems intuitive but an IT/BPO firm doesn’t plan for when they sell BPO, but you cannot sell Automate Everything® unless you have change figured out.
  • The changes you make in automation, lets you release people.  It’s easy to say you will use them in other engagements, but you need to grow in the same areas for them to feel well utilized. Or we have to be able to train them for other domains in a fungible manner. Training and also quality of resources becomes super critical.
  • You can’t transform using resources who aren’t high quality. You can’t have the typical low rates in BPO and say you will be an expertise led BPO. Therefore, one has to let go of many deals where they want transformation but want normal sweatshop BPO rates or simply are happy to mouth the right words but will decide on old school scale and price. Nothing wrong with that really if you want to continue playing that game.

Let’s take a quick example of a Retail chain in US in the F&A domain. Here we started with Accounts Payables from EDI to cognitive OCR (Ephesoft) to RPA (AA) to Medius flow … attempt was to make 90% + STP in AP. In AR, NLP lead bank statement entries and finally as consultant guide, them like why Blackline is best suited for them etc. Lesson learnt were 2 fold – along with CIO , Business stakeholders have to be in the project from start not  once it has kicked off; second is  while integrating RPA, ML point solutions the blue print should be clear to all  customer , implementers & point solution partners. And even if at times one has to push back on customers top management do so to ensure the ground realities are apprised at every stage. Bigger lesson was challenges may be galore but don’t restrict thinking big as Automate Everything® is meant be the bedrock of innovation. You will not get it at Day 1, but it is a journey that requires lot of courage, leadership, pushback and an ability to stand firm to implement it today.

Sanjog: What preparation do organizations need before they embark on the Automate Everything® journey? What’s a good readiness check, and how can they proactively get ready for the anticipated pitfalls?

Chinmoy: Quite a few to be honest, and I’ll try to list a few of them in terms of how we feel an organization is ready:

  • Buy in at the C suite or as close as possible to the top. I know it is tough to get alignment at the CEO because of certain issues but preferably at the top like the business heads, or the CIO, COO. And there has to be alignment between IT and Ops and business.
  • Ability to put a leader from client side to take part in the Automate Everything® assessments and possibly a small core team to face off. It’s an involved assessment and that shows readiness and commitment
  • Have a very well-defined ROI mechanism where the “I” of the ROI is not just about risk but also about cost, business value, revenue enhancements.
  • On the pitfalls there are many and there the best thing is to engage with firms like us or others who can at least get them started in the journey. We usually can invest in the Due Diligence provided the clients are aligned and can uncover a book of work. Like we did this last year with a very large Pharma & Healthcare company and we did the assessment alongside the customer who put in a few program managers from their side. The initial assessment came out with over 50 ideas. Some of them were declined and some of them were given to us, for example, we worked on automating finance processes using ML, worked in Translation areas where we translated over 50 languages to English but some of the ideas were kept in-house. We are essentially an idea-generator of this client of ours where we work on certain areas and don’t on certain others. But we are surely helping them evangelize this across the organization.

This is not for everyone. If you don’t have scale or you don’t have alignment, it is still better off to understand that this is the concept you want to go to and start with one or two areas. So, slow steps are the best way to get there unless you are totally aligned and tick most of the boxes. Automate Everything® still is every much on the evolution part.

Sanjog: How do you recommend an organization stay on this continuous evolution path of Automate Everything®

Chinmoy: Well same principles of any continuous improvement path regarding anything applies here as well. Our perspective is that if you don’t keep improving, someone will eat your lunch. Your customers whether they are of a service provider like us or a customer of a bank or an Insurance company will always look for better products, better service and more value. That’s just the nature of things isn’t it? How to stay on this path of continuous improvement, if I could break it down into two parts –

Quantitatively what Automation meant a few years back has evolved because of better technology. Especially with COVID-19 and the new WFH acceptability, our POV is that the next 1-year adoption will be 5 times more or put differently it will be what would have otherwise taken 5 years. So continuously being aware of the art of possible in terms of automation and adapting is important. And having metrics that measures that dynamically more so.

Qualitatively it means aligning the KRAs of the team to keep them interested. And not losing that to the culture of me too and people managers. It also means to evaluate if automation is achieving the right results and its not being done just to please the A-Gods or please the partners! The principle is to better CX, reduce risks, enable people to focus on more complex stuff and drive Business Efficiency. Essentially, we look if this is making our end customers life a better place, only then Automate Everything® and continuous evolution makes sense.

Once again, thank you, Chinmoy, for sharing your thoughts and insights about how BPO organizations and enterprises can leverage Automate Everything® to drive strategic benefits and maximize STP.

Thank You.

About the Author

Chinmoy Banerjee

Chinmoy Banerjee

Corporate Vice-president & Global Head - Banking & Business Process Services 

Chinmoy Banerjee has over two decades of experience and has worked in business consulting, IT services, business process management, and the banking industry. He runs the banking business vertical and BPO business across all verticals at Hexaware globally. In his career, he has focused on working with clients to solve business problems through a consultative approach and specializes in nurturing and building large businesses and teams. 

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