Since its explosion into business operations over the past 5 years, Robotic Process Automation (“RPA”) has proven to be a tremendous tool for delivering business value. Initially, the main perceived advantage of RPA was cost savings and productivity efficiencies within back-office functions. However, more and more organizations have been elevating the benefits of RPA to another different level by directly improving and accelerating their revenue enablement process and cycle times.
As Gartner states in its 2020 RPA Predictions, “Front-office opportunities can drive additional revenue, have a direct impact on customer experience and therefore, the business case can be built on a broader set of metrics”.
Clearly, RPA has established itself as a technology that brings value to business operations. And that value has also been demonstrated in some unexpected areas. For example, Auxis has worked with several clients where they have seen a significant improvement in their revenue enablement and revenue cycle times. Interestingly, this was not the initial intent of the robotic process that was implemented, but the benefit was quickly realized as one of its results. And in this time of uncertain revenue streams and collections concerns, more than ever, “cash is king”, with 71% of CFOs stating that cash and liquidity is their top concern, according to a recent PwC CFO Pulse Survey.
So how does RPA deliver this unexpected benefit?
From a collections perspective, human error is often to blame for aging receivables. Payers commonly reject invoices for inaccuracies, or insufficient or improper documentation. This, at best, results in delayed payments, and at worst, can lead to lost revenue. Waiting too long to get paid in these pandemic times can result in your customers going into bankruptcy or disappearing altogether. RPA eliminates human error and improves the accuracy of the data being processed, which increases the speed with which payment will be collected.
Beyond that, companies often have inconsistent or complicated processes that result in inaccurate or untimely billing and collection efforts. We have all seen this before: complex processes that have developed over time because “this is how we do this,” with little thought given to improve and streamline the activities. And companies’ IT departments generally have too much on their plate to focus on these arcane tasks, so the process remains as-is, despite the impact to revenue cycles and customer satisfaction.
Two recent Auxis’ case studies can provide some good insight on how RPA can enable more revenue:
One client, a distributor of plastic packaging products, had a significant challenge with providing customer quotes. This process was highly manual, time consuming and prone to errors, which would directly impact sales and margins.
The underlying issue was managing supplier pricing. Pricing was constantly changing due to the commodity-based nature of the source materials. Suppliers would provide updated pricing, typically via an email attachment (PDF or Excel file), and to get the current price, sales reps would have to go into a central email box or onto a shared drive, find the right file, and identify the most current price (in a document that could be 20 pages long with hundreds of items included!).
The process to identify the correct price typically took about 15 minutes per order, with the remainder of the quoting process being completed in 3 minutes. 80% of the time to generate a customer quote would be spent just figuring out what the correct supplier price was to mark up!
Using a combination of UiPath robots, SQL Server and PowerBI, we were able to automate the supplier price lookup process, providing the most current (and accurate) price in less than 10 seconds. The impact to productivity was dramatic (they had more than 100 people issuing thousands of orders per year, do the math!), and offered significant cost savings.
The unexpected benefit came in the area of Revenue Enablement. Under the original process, quotes took far longer to generate to customers, delaying the sales process. In addition, because of the manual and convoluted nature of finding the correct supplier pricing, quotes often went out with inaccurate, no-longer valid pricing.
When that occurred, the company was forced to “eat” the difference, impacting the company’s profitability. The RPA-driven solution solved these issues by allowing quotes to be generated faster, resulting in a quicker conversion to sales; and by ensuring that margins were preserved through accurate pricing.
Another recent example demonstrated how RPA can not only help to accelerate order processing, but also the time it takes to get sales to cash in the door.
This client is a medical supplier of various products and services in the rehabilitation space. Patients had to wait extremely long cycle times from the time they first engaged our client until the time they received their medical devices. There are a number of reasons for this long order cycle time, including supply chain and manufacturing dependencies, but a major factor was the ongoing, and highly manual, insurance claims process. Changes to the patient’s insurance coverage information (e.g. provider, deductible, coverage, out of pocket amount, etc.) caused significant delays in the ordering process, and often required the company to re-start the claims process when the patient’s insurance information had changed.
The manual nature of this process can lead to a delay in registering a payer’s approval/denial which also ends up delaying the delivery of the products. And the longer the order takes to complete, the more likely changes to insurance coverages would occur. As a result, the company had to perform multiple insurance verifications for the same patient at various stages throughout the ordering process in order to ensure that a patient’s coverage is current throughout the whole process, up to the time of their delivery.
Implementing UiPath’s RPA platform was an ideal solution to increase efficiency in the end-to-end insurance verification process, providing a reduction of at least 20% to the order fulfillment cycle. RPA has also increased customer satisfaction while providing our client with a significant competitive advantage, as this issue is common across all companies in their space.
Lastly, RPA helped improve the company’s speed to revenue, reducing the time between order and delivery, and therefore billing the payer. This reduces the risk of patients switching to new insurance providers, which can significantly delay product delivery and billing by requiring a restart of the whole approval process.
Very often, this issue was not discovered until months later. By the time the patient received the products, he or she may have changed their insurance provider, and the company did not realize it at the time of delivery. So an invoice would be sent to the wrong provider, and several months would go by until a collections follow up would occur, only then learning that the invoice was sent to the wrong company. The billing process would have to be restarted, and the clock on getting paid would start over again as well. A simple thing like having a robot verify the patient’s insurance coverage more frequently completely solved this problem.
Expanding the business case of RPA beyond cost savings
I could go on and on with other recent case studies that prove the value of RPA beyond cost savings. But the key takeaway from this article is that organizations need to analyze RPA opportunities not only thinking about cutting costs in the back office, which may start to diminish in returns, but also looking into more complex, customer-facing activities that drive revenue acceleration and growth.
Indisputably, the lure of RPA is strong, with its low cost of entry and rapid ROI. Auxis has found that clients typically achieve a 41%+ productivity gain from the technology. It has been proven that RPA can provide tremendous value across the enterprise, and clearly the increased productivity, 100% accuracy and direct cost savings are obvious benefits from its implementation. But, as we have seen, there are other, unexpected benefits that companies can derive from the tool.
Companies should start challenging their RPA provider early on to give references of similar use cases and provide a portfolio roadmap to conduct due diligence of how their investments will allow you to scale and gain competitive advantage.
The focus of RPA within your hyperautomation journey should scale across your enterprise from the back office all the way to front-end analysis. Given the recent events, intelligent automation has become a “must have”, and those organizations that are not taking advantage of it are going to be left behind.