16 May 2017 10:55:54 IST

A management and technology professional with 17 years of experience at Big-4 business consulting firms, and seven years of experience in high-technology manufacturing, Rajkamal Rao is a results-driven strategy expert. A US citizen with OCI (Overseas Citizen of India) privileges that allow him to live and work in India, he divides his time between the two countries. Rao heads Rao Advisors, a firm that counsels students aspiring to study in the United States on ways to maximise their return on investment. He lives with his wife and son in Texas. Rao has been a columnist for from the year the website was launched, in 2015, and writes regularly for BusinessLine as well. Twitter: @rajkamalrao

How RPAs take away BPO jobs

With Excel Macro-like features, this automation threatens to make BPO organisations go under

I hate jargons as much as the next person. The latest acronym to inflict the 25-year-old Business Process Outsourcing (BPO) industry is RPA, short for Robotic Process Automation.

RPA is so new that an industry group was formed only four years ago — the Institute for Robotic Process Automation and Artificial Intelligence (IRPA AI). According to it, RPA is defined as the “application of technology that allows employees in a company to configure computer software or a ‘robot’ to capture and interpret existing applications for processing a transaction, manipulating data, triggering responses and communicating with other digital systems.”

Confused? Well, you are not alone. One of the worst ways to clarify a jargon is by using more jargons to explain it! In layman’s terms, RPA uses Excel Macro-like functionality (recording a series of steps) to automate manual tasks that extend beyond Excel.

Breaking down the jargon

Let’s break it down through a simple example to see how RPAs could potentially impact the lives of thousands of Indians who are in difficult, mundane, repetitive BPO jobs.

Consider a large Dutch goods trading company in the city of Rotterdam, home to one of the world’s largest ports. The company, which is involved in exports and imports, requires the latest foreign exchange rates published by the European Central Bank (ECB) to be keyed into its SAP system. Then, the SAP software can correctly calculate invoices, commissions, customs duties, VAT taxes and other line items essential to the functioning of modern global economy.

The BPO job

Until recently, the data entry tasks would be performed by an employee of an Indian BPO vendor, in the middle of the night at a modern tech park in a big city such as Hyderabad or Chennai. He would look at a spreadsheet submitted by the company, which listed all 400 goods passing through the company’s clearing agent in Rotterdam that day.

For each item, he would take the supplier’s VAT number, a simple tax identification number much like the PAN, and verify it online at the EU’s official VIES website. If the number came back fine, he would enter ‘yes’ under the ‘verified’ column; otherwise, he would mark the entry as ‘incorrect VAT’.

Next, he would go to the ECB’s website, search for the correct exchange rate information in Euros and key it back into his spreadsheet, for each item from the host country. Say the shipping country for item #1 was the Republic of South Africa. He would key in the Rand-Euro exchange rate into the spreadsheet. For item #2 which came in from Singapore, he would key in the Singapore Dollar-Euro exchange rate, and so on.

Finally, he would use the SAP import feature to upload the updated spreadsheet into the Dutch company’s systems for all valid entries — and kick off the hundreds of business processes in the back end that SAP typically executes. When the Dutch company’s accounts manager would show up for work at 8 am the following morning, he would smile over a hot cup of coffee, to see a confirmation email that the Indian BPO vendor has completed all the data entry and validation tasks from the previous day.

What happens now?

However, with RPA now in the picture, the Indian BPO organisation can be completely eliminated. A clerk in Rotterdam need only use RPA software from a company such as Blueprism. Much like an Excel Macro, the clerk would record each and every task that the Hyderabad employee manually completes, just once.

The RPA software would then remember every command, step by step. The clerk can pause at any time and run a test of the steps, making tweaks as required. If not satisfied, he can insert, delete or edit individual steps to get things just right.

There is no limit to the number of steps recorded to process each item. Typically, hundreds of steps can be recorded and automated, including visiting external websites, keying in information into external search boxes, reading information from the external search and inserting it back into the spreadsheet in the appropriate box.

Click of a button

And because it’s a software program, all steps for item #1 can simply be commanded to loop and repeat for item #2, #3, and the rest of the 400 items on the sheet. Once the RPA instructions set is complete, the software is ready to execute the task.

On the click of a single button, the RPA can perform every single task that the Hyderabad employee did, including logging into the SAP system in the end and uploading the updated sheet. It can even send the exact same email to the accounts manager, saying the job is complete.

This is extremely powerful. It is not exactly Artificial Intelligence in the sense that the RPA software is not learning along cognitively — it only mechanically completes its chores. But the tediousness and the boredom are now outsourced to a software program, which commits far fewer errors and never gets up for a bathroom break. And for the Hyderabad employee, it means that he has to quickly learn new skills or be out of a job, placing at risk the livelihood of his family.

Research shows that RPA software can typically do a job up to 10 times faster than a human being. And when it comes to accuracy, the old jargon of GIGO (garbage in garbage out) applies. The software is not smart enough to know if the ECB has mistakenly provided an erroneous exchange rate — the wrong rate is simply recorded and used in all downstream computations.

Growing clients

Mihir Shukla, a person not many people have heard of, is the CEO of Automation Anywhere, a San Jose, California company with 350 employees. Featured in the ‘Top 20 Tech Companies to Watch’ edition of CFO magazine last month, Shukla says he now has more than 500 enterprise clients worldwide and that the company experienced net growth of 167 customers in 2016.

In other words, an Indian-American largely hiring other Indians in the US, many of them with freshly minted US Master’s degrees in computer science on H-1B visas, is slowly helping eliminate BPO jobs in India and making BPO companies go under.

Welcome again to the global economy!