The untapped potential of digitisation part 2

Read the first part of the discussion on digitisation in our article The untapped potential of digitisation

Alin Niță: Good evening dear viewers, I’m Alin Niță and I’m your host this evening where we will discuss digital transformation, processes, work processes of an organization and how we can contribute to their digitalization: automation and robotization. To be able to discuss this topic, this evening we have Aurelian Iuscu as our guest, he is managing partner at Busniess Future Solutions, he is an artisan of work processes and work process optimization. Good evening, Aurelian, welcome back to our show.

Aurelian Iuscu: Good evening and thank you for the invitation!

Alin Niță: Joining us is Mario Popescu, co-founder of Tailent, a robotics platform that we’ll be discussing on the show. We will discuss how we can get from the processes to these robots. I was saying that the theme of the show is related to digital transformation, to the untapped potential of digitalisation. Those are the key words we hear these days, digitisation, process automation. We want to be able to transform as much of technology as we can so that we can be better off. If you didn’t watch last time’s show, we invite you to do so and you can also follow us on our YouTube channel at the same time. I’m going to get right into it. Aurelian, does it help to summarize what we discussed on the last show about work processes? Why it’s important to look at work processes, how it’s good to look at them and how to get them ready to îtowards digitisation?

Aurelian Iuscu: On the last show, Alin, we focused on a word that resonates quite strongly, that of waste – waste in processes. We generally want to look at processes, identify waste and eliminate it. Sometimes you can’t even eliminate it 100%, but you can reduce it as much as possible. That’s why we always consider the voice of the customer. We talk about the voice of the customer, which is the voice that needs to be satisfied with that output of our process. In any organization, whether it’s small, whether it’s medium, whether it’s large, we run some processes. The outputs of the process, whether it’s production or services, are to a customer. We have to understand the voice of the customer all the time and come up with a perfect alignment between the voice of the customer and what we deliver, which is what the process output is.

Alin Niță: Experts say that repetitive processes and those that are governed by the process, by business rules, are quite clear and can be 90% automated. Mario, we were talking about robots last time, how do we define robots and what can be automated from the perspective of robots in quotation marks, and can you tell us what robots mean?

Mario Popesscu: Of course. As a little summary of the discussion last time, we need to be exposed to robots, we need to not be afraid of them. They are, as we discussed, assisted and unassisted robots. The assisted ones we see much more easily and they are there to be a reliable support in our daily activities. And yes, in principle, robots are there to help us.

Alin Niță: And I would like to discussăm more concrete things. Let’s give some examples of such processes that we can automate and that have been found by specialists, by us, by you, by the market in general, to be processes that can be automated without any doubt. Can you give one such example? And I’d really like to ask the directors if they can put the picture to make it easier to understand.

Mario Popesscu: I believe that any company in Romania has a series of processes that must be carried out, regardless of the name of the company, regardless of how many employees it has. There are a lot of standardised things, for example the human resources area. All companies have fairly simple processes. New employees come into the company, there are a lot of activities that have to be done to get new employees, a lot of forms that have to be filled in or a lot of data that has to be synchronised from one application to another application.

Alin Niță: However, our viewers have a few such examples on screen that we are currently offering.

Aurelian Iuscu: Yes, there are certainly examples from which those who are watching the show at the moment might understand very clearly.

AlinNiță: They are in these projects.

Aurelian Iuscu: Exactly. If you have a company, if you are involved in the activities of a company, of a firm in Romania, most of the things you see on the screen have certainly bothered you or until now you would not have looked at them in any other way than that they are necessary things that have to be done step by step every time each of them is needed as a process, but all of them are basically automatable. There may be differences from company to company depending on what applications are needed to perform each process there, but at their core these actions are repetitive, they are tedious, they don’t allow us to practically focus on the activities that add value to the company but rather take away from our focus, take away from valuable time where we could be doing things that add more value.

Alin Niță: Practically these processes can be found in any company, from large companies to companies in the SME area. But we can also find them as part of public administration. Maybe some of them don’t, but in general they can be found. I would propose to do it this way, to go on a concrete scenario, it’s much easier for our viewers to understand when we go on the road, looking at our company. We are, for example, a company that is not service-oriented, it may as well be for production, but it is also service-oriented and it has to perform services through the staff it has internally. At that time it has departments that deal with all kinds of activities and within the departments there are more standardised or less standardised work processes. That’s where we’re going to talk together. If we look at a process, we look from the perspective of the performance that that process has and whether it could bring value, whether we go for an optimization of that process that leads to automation, but I think we can look as well if it hurts us că that process is not well set up. What impact does that have on the costs that the company loses? How is it here, Aurelian? And really please put the next slide.

Aurelian Iuscu: Here, in general, an optimization project consists of the correct and coherent formulation of a business case. In other words, it must contain at least 3 valuable pieces of information: where am I now, where do I want to be and what do I lose by not being there? In other words, I am in the area where, for example, I am delivering something, but I have delays in delivery. I have unhappy customers, which means that if this delivery is delayed by a few hours or days I might lose some of my customers. And then it’s very important to come and say exactly on the customer’s request, on a certain timeframe if we’re talking about this example, to be able to deliver as well. The fact that I don’t do this job I can take it to an annualized financial axis in general. And then I come to the conclusion that I have it for 30 gap of one hour, two, three or maybe even 9 and I’m not at the difference of a few minutes because this maximum gap the customer could tolerate, leads me to an annual cost of 10-15- 20 thousand, 200 thousand euros depending on the size of the company.

Alin Niță: If I talk about a simpler process, can I talk about smaller amounts, a more complex process, larger amounts or does it depend on volume, data, value of projects?

Aurelian Iuscu: It generally depends on the size of the company and this is given, in general, and business volumes. That’s why, always when you have a repetitive business, any minor gain multiplied many times, becomes something major in terms of financial stakes. But the stakes of an optimisation project are not only from a financial stakes perspective. They can also be from an operational risk reduction perspective. We’ve noticed lately that there are certain risks that by not analyzing them or not seeing the real face of that risk might one day crack and cost a lot more than it would have been to invest in a project where you look at it with a proactive approach, going on some proactive activities because we know in general that corrective ones are much more costly.

Alin Niță: Mario, I can’t wait to ask you about how much you save a company in terms of money when you automate certain processes, but we’ll come back to this question. I would propose that we do it this way: Let’s go a bit more concrete with an example. Let’s say we are a service company, we have all kinds of processes. If we look at the HR department, we can identify different processes, sub-processes, activities.

Mario Popescu: Let’s call them activities, to make it easier to understand.

Alin Niță: Activities that we can take, analyse, possibly check and see if they are indeed suitable for automation, going on the idea that some can be automated and others cannot.

Mario Popescu: Here I would make an addition. Aurelian has captured a very good essence, but I would also suggest that we look from another direction, from the company’s habit. In general, the company that is not yet technology-savvy will have a little reluctance at the beginning, will want to see some first examples and then will not necessarily go directly into the flows that will save them a lot, but will go on some smaller activities, just as you said. The ones in the human resources area are of very good efficiency.nă where you can quickly see what is the non-investment merit for the amount that you commit to an automation project and how much it saves because, after all, any SME needs to see a return on the investment that it makes and then there it is very easy to see in this part of HR activities.

Alin Niță: Very good addition. Let’s go to a financial department, to accounting, where there is invoicing. The process can start from invoicing, orders, sending the invoice to the customer, the customer pays. In this whole flow, this process, how do we look at it. Aurelian? Let’s focus for example on bank statements. The customer pays but someone has to look at this information. Most of the time it’s data or figures where you have to look at it. Probably human error can be quite large. Let’s take this example and tell me how you see it from a specialist’s perspective?

Aurelian Iuscu: It is a good example because in general this process being standardized lends itself very well to automation. That is to say, it’s a series of tasks that this software, the little robot as we have called it, can do without any reservations. And I see that our viewers have a diagram showing that a company’s priority in automating processes is given by certain conditionalities. That is to say the process should be repetitive very often, which means that I relieve the human resource of a tedious job as Mario very rightly said, after which the process should be standardized, it should be without very many exceptions so that the robot can do its repetitive work in an ultra-fast way as it happens. And here we have a lot of examples, one comes to mind for example the query at the credit bureau where a human copy pastes into an application, exports some information, enters it into another internal application and instead of a few hours, the automation takes a few minutes. If we go back to the chosen example of statement reconciliation there is an area where there are some very clear steps: you import some files but I would prefer to let our expert Mario explain from the perspective of automated steps but clearly you have a standardised structure of steps where there is no need for human intervention. We will probably also deal with more complex situations where human intervention is also needed. Mario I’ll leave you to detail the steps a bit.

Mario Popescu: The example is very good because technology as first steps are excellent steps in the financial area. There we are talking about figures, we are talking about data that has to be moved between different systems, maybe systems that were not designed to work, to communicate with each other and then let’s see what the bank statement looks like. The bank statement has a standardised form, each bank has a certain way of giving you the bank statement that you can take from your account or receive by email at a certain frequency or periodicity. I would suggest that we do an exercise: what does the day look like for the person who does this every day? Who takes the data from the bank statement. What do those moments, minutes, tens of minutes look like? As you were saying, if you look at a company that provides services in different areas of whatever industry it is, there are certainly many transactions and many different types of transactions. And then the person there has to identify either a payment to suppliers, a collection from the customer, we’re talking about bank fees, lines from statements, they have to check them one by one, one by one.

You can find out more about digitisation by watching the full programme. If you want to watch the whole show, play the video: