Robotic process automation has proven to be a major optimi zation lever of nance activities. However, in order to be fully eff ec tive, the application of RPA is a step that needs to be considered within a wider optimization review of nance- related activities and processes. February 20182 Roland Berger Spotlight Robotic Process Automation Finance functions have been transforming themselves in recent years with the aim of evolving from a “data producer“ to a “strategic business partner“ for their internal clients. This transformation requires them (i) to switch from re- active to proactive delivery of data, analyses and deci- sion-making support to internal clients, (ii) to evolve from being “closing driven“ to “day-to-day driven“ in their interactions with key stakeholders, and (iii) to do so while maintaining a balance in terms of the quality, timing and cost of financial and accounting data produc- tion and reporting. With RPA, or robotic process auto- mation, becoming more prevalent, there is now a way to address these challenges effectively, notwithstanding the increasingly complex context in which the transfor- mation of finance functions is taking place: 1. Finance has a growing role in strategy development and support, thus requiring a higher level of business insights. This calls for an in-depth understanding of the busi- ness's cost and revenue drivers, among other things. The growing role afforded to Finance is coupled with rising expectations from the business and other func- tions in terms of the added value analysis and support for decision-making processes that they expect from finance functions on a day-to-day basis. 2. There is growing pressure on the timing (i.e. accounting closing, regulatory reporting, budgeting/forecasting process) and costs (i.e. finance function costs as well as total group costs) of financial and accounting data production and analysis. 3. Expectations and workload related to regulatory require- ments are surging as companies strive to achieve com- pliance with IFRS 9, among other things. 4. There is a need to upgrade and reinforce skills and com- petencies around data enrichment, analysis and gover- nance. 5. Complexity related to the management of resources and competencies within Finance is growing. The challenge for many finance functions is twofold: Not only do they have to (i) ensure efficiency and sufficient pro- ductivity in activities related to data production and control, but they also need to (ii) ensure the necessary development of resources and competencies on activ- ities related to advisory and added value analysis and support to the business (i.e. controlling, tax, treasury and corporate finance) RPA as a major optimization lever for Finance Robotic process automation has proven to be a major optimization lever within finance activities as compa- nies strive to face these challenges head on. However, in order to be fully effective, the application of RPA is a step that needs to be considered within a wider optimization review of finance-related activities and processes. In recent years, we have conducted numerous as- signments in the field of RPA in finance functions across various industries. Our main takeaways include: TAKEAWAY #1: Optimization potential through the use of RPA in finance activities is significant and typically reaches up to 20-25% RPA is well suited to activities that are repetitive, have structured and digital data, and are processed following a rule-based approach (as opposed to a judgment-based method). Many finance activities are therefore suitable for (full or partial) automation in this manner. Our expe- rience in this area shows that 20-25% of accounting ac- tivities can be optimized through RPA, along with 8%- 15% of controlling and other reporting activities. TAKEAWAY #2: T o be fully effective, RPA must be part ofa broader process optimization and simplification effort RPA does not constitute a process simplification or im- provement lever per se, but what it does do is allow you to replace repetitive, manual and rule-based tasks with an automated process. As a prerequisite for a successful RPA rollout, it is therefore necessary to analyze the sim- plification, harmonization and optimization potential of the underlying finance activities. It is important to re- member that a sub-optimal automated process remains sub-optimal even if RPA allows you to minimize the re- lated workload and hence the cost of this process for the organization. TAKEAWAY #3: RPA constitutes a short-term solution, with quick payback, which can help to fund a more sustainable long- term improvement of the underlying finance system landscape Development and implementation of an RPA solution is relatively quick, typically taking between 6 and 14 weeks depending on the level of complexity of the underlying processes. Payback periods are therefore usually around 4 to 8 months. Many companies leverage the (short- term) gains generated by the rollout of RPA to fund a longer-term and more sustainable optimization or sim- plification of the underlying IT system landscape in Fi- nance, the ultimate objective being to maximize the use of end-to-end automated accounting and finance pro- duction processes.Robotic Process Automation Roland Berger Spotlight 3 Figure 01: The benefits of RPA fit well with the typical key challenges experienced in finance functions. TAKEAWAY #4: RPA projects must be coupled with an analysis of the expected evolution of required skills and competencies within Finance Our experience shows that RPA is usually well accepted within Finance teams as it impacts predominantly the most manual activities and those with little added value. As such, RPA is a key contributor to the transformation of finance functions from the role of “data producer“ to the role of “strategic business partner“ as it enables them to free up workload in production, control, consol- idation and reconciliation related tasks. There are two main HR stakes in this: (i) the rollout of RPA will require the acquisition of new RPA analysis and management skills within the finance function to support the industrialization of such solutions, and (ii) RPA needs to be coupled with an analysis of activities, workload and skills balancing within Finance. Gains generated in production-like activities are often (partial- ly) reinvested in higher added value activities and sup- port to internal clients. In conclusion, RPA is an interesting and effective lever to replace repetitive, manual tasks with an automated pro- cess generating substantial productivity gains around production, control, consolidation and reconciliation tasks. To be fully effective, it needs to come after a pro- cess simplification and harmonization effort and it has to be coupled with (i) an analysis of the long-term end- to-end automation potential of accounting and financial production flows and (ii) an analysis of the expected evo- lution of HR needs and related skills/competencies in the parameters within which it is being rolled out. Quelle: Roland Berger MOST COMMON ROBOTIC PROCESS AUTOMATION BENEFITS TYPICAL CHALLENGES FACED BY FINANCE FUNCTIONS > Enables you to focus on added value tasks and activities rather than on high-volume and low-complexity production tasks > Hence, facilitates transformation from a pure data provider to a strategic partner to the business 1. Role of Finance in strategy & business insights is increasing > Enables the use of advanced analytic techniques > Fosters continuous learning (improvement analysis based on live data collection) > Supports better decision making 4. Data 0 1 0 0 1 0 1 0 1 0 1 0 0 > Eliminates the error rate inherent in human processing > Ensures higher consistency within the organization > Deals with local specifics through customization of parameters > Improves traceability through systematic process tracking and documentation 3. Increased regulatory requirements and scrutiny > Increases staff satisfaction/retention and frees up staff capacity to deal with more complex issues > Avoids burdens related to staff turnover (onboarding time, training) > Eliminates the need for offshore/nearshore/outsourcing of low-complexity, high-volume tasks associated with considerable coordination costs 5. Staffing & management of resources > Enables you to reduce cycle times, adapt to peaks (e.g. closing periods) with the ability to scale easily > Works 24/7, 365 days a year 1 robot typically handles the workload of 2 to 4 FTEs > Offers higher visibility on deadlines and facilitates the management of interdependencies 2. Time and cost pressureAUTHORS Axel Bohlke Principal Competence Center Financial Services Brussels +32 478 979713 axel.bohlkerolandberger WE WELCOME YOUR QUESTIONS, COMMENTS AND SUGGESTIONS More information to be found here: rolandberger/report Disclaimer This publication has been prepared for general guidance only. The reader should not act according to any information provided in this publication without receiving specific professional advice. Roland Berger GmbH shall not be liable for any damages resulting from any use of the information contained in the publication. © 2018 ROLAND BERGER GMBH. ALL RIGHTS RESERVED. PUBLISHER Roland Berger GmbH Sederanger 1 80538 Munich Germany +49 89 9230-0 rolandberger