Emergence Partners
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David Poole, CEO of Emergence Partners.

Member Article

Is hyperautomation just hype without the automation?

As the business world attempts to keep pace with the exponential march of technology, and in general continues to fall well behind, there are nonetheless several interesting market signals indicating that things are about to change.

UI Path’s latest seeding round, announced last week, is a serious signal of intent, with CEO Daniel Dines pledging to “bring automation to one billion citizen developers.” The robotic process automation (RPA) market is taking the digital world by storm, with at least one unicorn and a growing number of products, services and addons developing in a rapidly growing sector. Large corporations are queuing up to buy these tools, and there are already thousands of consultants designing and implementing process improvements - and yet, there remains huge frustration and strangled potential. Even today, after six years of mainstream exposure, Gartner estimates that 95% of the buyers of RPA systems have only implemented up to five bots. Thus far, the hyperautomation story has arguably consisted of plenty of hype, without the automation to match.

A similar pattern is emerging in the low-code/no-code (LCNC) market. LCNC means that apps that used to take months or even years to build can now be configured, tested, adjusted, connected and launched in as little as a few days, by citizen developers who possess an acute knowledge of the business. This has been touted as the next big thing for years, with multiple very large companies from Microsoft to Salesforce to PegaSystems - plus a whole bunch of the good, the bad and the ugly other providers - all developing products. But once again, take up has been slow. As recently as 2018, Forrester found that only 23% of 3,228 developers surveyed worldwide were using low-code. Nonetheless, Gartner predicts that low-code application development will be responsible for more than 65% of application development activity by 2024.

RPA and LCNC have a few things in common which make their potential for disrupting the whole software and technology sector huge:

  1. They are both generic tools that can be used in almost any kind of business, from any sector, and can enable rapid and transformational change.
  2. They are both democratising the enterprise-grade creation of new business systems, moving away from the traditional development models that have for decades been the domain of the IT department.

These technologies will be integral to the full realisation of hyperautomation, which tops Gartner’s list of 10 strategic technology trends for 2020. Hyperautomation promises to seamlessly combine multiple technologies and human intelligence into an interoperable system of automation - but as demonstrated by the long gestation periods of RPA and LCNC, this will be far from an overnight sensation.

Hyperautomation is following the path of exponential technologies

Daniel Dines at UiPath predicts that soon, more or less every worker will have a bot on their desk. Despite the frustrating start, this looks to be a distinct possibility. UiPath’s strategy - intuitive user interfaces and democratised automation tools to unleash the potential of people – is absolutely on the right track to deliver on hyperautomation ambitions.

RPA and generic automation tools in general are exhibiting the behaviour of exponential technologies. Much like solar power, digital photography, exponential technologies, they suffer in the near term from the effects of what is known as Amara’s Law. This states that:

“We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run.”

As these technologies emerge, they tend to disappoint for some time, and initially fail to deliver on their potential while the markets work out the best way to extract their value, innovate new products, imagine new pricing models, refine use case implementation approaches, and build ecosystems.

These slow beginnings are something of a rite of passage before the full force of scaled-up exponential growth can be felt. As I wrote recently in Data Economy, organisations must think long-term and not be afraid to undergo periods of underwhelming results during this experimental phase of the business lifecycle. The results in the long-term are astonishing; in one such example, solar power has grown 48x over the last 11 years in the US after a slow start.

Adopters must value the strategic over the incremental

As the RPA market finally begins to reach maturation, there are lessons we can learn from its stunted growth over the past decade - particularly since low-code/no-code is in the earlier stages of a similar journey. According to KPMG, nine out of ten enterprise adopters of RPA failed to get past piecemeal projects and pilots to achieve proper scale. Traditional operating models have been focused on incremental improvements; on cost reduction over value creation. This is an approach that will have businesses hunting ever after for short-term fixes to drive out further costs, while kicking the can down the road when it comes to designing an intelligent strategic journey that really benefits customers and employees.

The slow take up and low penetration of the business systems and transformation market is perhaps not surprising, given that there are certain elements of the adoption process that set buyers up for failure before they have even signed the dotted line. Here there are a couple of key red flags to be vigilant about:

• Old school software sellers rebadged with RPA digital business cards and licensing models as old as the hills, and a lack of interest in anything other than shifting licenses - as many as possible, as quickly as possible. Many of the software companies themselves are rather too traditional and have not evolved their own business models sufficiently.
• A general lack of strategic thinking in the software buying process. Partly prompted by the offers of cheap or special deals from vendors, and in their eagerness to achieve huge returns on investment, there remains a lack of long-term direction, and so adopters tend to suffer from the ‘random acts of automation’ syndrome. Vendors typically view strategic thinking as little more than a delay in license sales, so are not really motivated to offer substantial guidance – although I would surmise this would be much better for their own long-term growth.

This is where a level of specialist guidance is often required. Businesses need to look to the future of profound transformation - the kind of transformation that uses technology to deliver and enable step changes in value creation. The journey to democratised automation in the enterprise will make the world a better place to live and work, but many organisations lack the frameworks to ensure that the benefits of hyperautomation are realised in a controlled manner. Adopters need to develop the strategies for integrated hyperautomation initiatives that drive an equable, symbiotic relationship between human creativity and the power of machines - and this vision does not spring forth naturally from the current buying process.

Accelerating the exponential

It is exhilarating to imagine the positive potential of equipping all the humans in an organisation with the endurance and superpowers that automation can provide. But without a clear strategic direction and intent across the entire business, and without the control environment to ensure standards are maintained, enterprises could be destined to go into self-destruct mode. Horses for Sources’ Digital OneOffice is an excellent example of a framework that unifies front, middle, and back office processes, with end-to-end strategic automation that smashes through traditionally rigid organisational structures. Systems like this need to be designed for teams across an organisation to collectively analyse, design, automate, measure, monitor and reassess. The human impact of getting this change process right is monumental: conventional management and organisational structures will need to be changed, performance measurement and reward processes re-written, recruitment policies and standards reimagined.

We are well on our way towards a highly augmented human workforce, and I applaud pioneers such as UiPath that are hauling the market in this direction. But this high promise will only be delivered upon once businesses learn to temper their temptations toward short-term incremental gains and focus on organising these technologies into systems carefully designed for long-term value creation. RPA and low-code/no-code - two of the most transformative and democratising tools we have - will realise their full exponential potential in strategically Integrated automation initiatives, with potential to scale across business functions and ultimately augment higher-value human workers.

This was posted in Bdaily's Members' News section by David Poole .

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