There has been a lot stated about the promise and reach ofRobotic Process Automation (RPA), from enhanced productivity andimproved customer experience to cost savings.

Current estimates suggest RPA will impact as many as 1 in 3 jobsworldwide. It is now unquestionable that the robotics tools on themarket today can empower transformative change. But a pressingquestion remains: Exactly how can insurance professionalsharness the capabilities of RPA to realize value for theirorganizations?

Most insurance carriers are in various stages of building asufficient foundation to enable rapid delivery, maximize ROI andgain a true competitive advantage when it comes to RPAadoption.

Regardless of where these organizations are in their RPAjourney, the challenges they face typically revolvearound the following questions:

— What processes are best for RPA and how do Iprioritize them?

— How does RPA fit in my operatingmodel?

— Which RPA tool is right for me?

— How do we measure intendedoutcomes?

Successful RPA programs address these questions through fivecritical steps, starting with an organizational macro assessment ofcurrent processes (along with their tactical and strategicinitiatives) and the technology landscape affected by RPA.

Related: Insurance 2017: Priorities for innovation,automation and transformation

Step 1: Perform a macro assessment.

A comprehensive macro assessment of processes that support your lines of business(LOBs) is a critical step for optimizing and automatingprocesses using RPA tools. This macro assessment will lead tobuilding a roadmap for you company's automation journey that isaligned with the company's vision and goals, will maximize ROI andlead to a successful implementation of the RPA solution.

Given the complexity and uniqueness of today's insurancecarriers, it would be naïve to think that a one-size-fits-allapproach to RPA would work across the industry. Therefore,examining your organization from the top down by functionalbusiness case is vital to determining what type of RPA solutionwill fit best and how it should be deployed.

Take, for example, the claims process: create a top-down view bybreaking the end-to-end process into functional groups (intake,policy verification, segmentation, fraud verification, adjudicationand payment approval) and analyze the number of resources aligned.Then identify the individual processes that make up the functionalgroup along with the respective headcount and volumes.

Related: Realities and risks of the robotrevolution

While the macro assessment is underway, you can begin to definean operating model, perform process assessments and select a toolor tools.

The following Gantt chart illustrates how you can plan to runvarious activities while catering to dependencies. For example,"Implementation" cannot start until a tool has been selected.

Some insurance industry leaders have built EnterpriseCenters of Excellence to provide oversight on new projects andensure that they are aligned with the organization's strategicautomation goals. (Photo: iStock)

Step 2: Define your operating model.

To gain competitive advantage in the marketplace, RPArequires rapid implementation.

Yes, a central enterprise group should set the requiredgovernance and controls to ensure consistent standards. Butorganizations that follow a centralized model for all things RPAwill lose their speed to market, anticipated efficiencies andcompetitive advantage.

Across the insurance industry, many organizations view RPA asany other technology that demands control rigor from within IT(heavy SDLC, all RPA configurations centralized into IT, etc.) Thishas led to multiple cases where initial RPA efforts have been miredwith missed deadlines, cost overruns and ultimately failure toachieve the initially identified benefits case. 

Conversely, the most successful leaders in the industry havechosen to centralize governance, standards and frameworks, butchoose a tool (see Select the Right Tools) that allows them toconfigure the Bots within the business or business technology groupand teach it to high-end business/systems analysts in a matter ofweeks (or a few months at most). Additionally, leaders in theindustry have built Enterprise Centers of Excellence that areengaged with the individual LOBs and their intake models. In doingso, the CoE provides oversight on new projects, ensures that theyare aligned with the organization's strategic automation goals, andthat they are leveraging existing tools.

As part of the governance, the COE also plays a central role inestablishing and monitoring key performance measures.

See also: 6 steps to take to evaluate cyberrisk

Too many organizations view RPA assessments as a one-timeactivity, which can be a mistake. (Illustration: iStock)

Step 3: Assess processes.

Most organizations do a fantastic job identifying processes forRPA. For example, processes that were previously BPO'd andprocesses that are highly repetitive with heavy staffing requiredto support them.

Yet, too many view this as a one-time activity and fail tocontinue the analysis across all LOBs. Simply identifying processesas a one-time activity and moving toward design and implementationleads to extended timelines and costly technology workarounds tobridge RPA gaps.

If struggling to identify candidate processes, take theprocesses that make up the functional groups identified in themacro assessment and assess them from a bottom-up perspective.Continuing with the claims example, for the payments process,assess each process by reviewing all relevant SOPs, process flowsand user guides, and determine which applications are usedthroughout the process. You will ultimately determine theapplicability of the process from an RPA perspective based on twothings:

1. The data necessary to complete theprocess is discrete and digital.

2. All business rules required to run theprocess are clearly defined.

Once you determine how much of the process can be automated, youcan estimate the expected benefits and build the business casespecific to that process. The business case can be aligned torevenue creation, process optimization and/or cost reduction orconsistency of meeting regulatory requirements, but regardless ofthe metric, the business case should be clearly defined prior toproceeding with the automation project.

Related: 5 high-tech challenges (and solutions) for today'sindependent agents

Make process assessment an ongoing activity to continuously findopportunities for cost savings within the business. Establish anintake process capable of continuously prioritizing the backlog ofRPA projects for delivery.

If selecting the first RPA tool for the organization, youshould focus on a tool that will enable you to achieve rapidresults based on the requirements within your organization. (Photo:iStock)

Step 4: Select the right tools.

A macro assessment will enable your due diligence process priorto signing with an RPA tool vendor, so that you make the bestinitial decision. Each of the tools on the market has strengths anddifferentiators that make them the valid choice for various firms.We have seen multiple examples where a client has selected an RPAtool prior to completing a true analysis, which has led tocommitting resources (time, labor and money) to a tool that doesnot enable deliveries that align to the organization's ROI ortimeline expectations.

Essential questions a macro assessment will help you answerbefore selecting a tool include:

— What kind of automations will be executed:assisted or unassisted?

— What data ingestion capabilities exist, and what areneeded: OCR and/or ICR? 

— What capabilities do the businessrules require: basic RPA orcognitive? 

— Where will the automations occur:business processes or IT automations? 

— Who will be configuring the bots:technologist in a centralized model or business analyst in afederated model?

If selecting the first RPA tool for the organization, you shouldfocus on a tool that will enable you to achieve rapid results basedon the requirements within your organization.

Related: The impact of more data on the claims handlingprocess

However, if you already have a tool and realize another optionmay be better suited, be prepared to leverage multiple toolsdepending on the complexity of the process being automated.

As you begin to scale your automation efforts, you willencounter a unique set of challenges for which you will need toprepare. (Photo: iStock)

Step 5: Implement in modular fashion.

Take the time to do a bottom-up view of the process you'veselected for RPA. By doing so, the organization will likelyidentify several key steps where deployments can occur using amodular, or minimum viable product "MVP," approach so benefits canbe realized rapidly. Understand that RPA is not the answer to everyneed, and other automation technologies (e.g., data ingestion andcognitive) may be required to achieve certain automations or toenable Straight Through Processing "STP."

Start by going after the low-hanging fruit such as the "swivel-chair functions" within the claimsprocess with the highest applicability for RPA that can bedelivered rapidly at a low cost/risk. Build an inventory of thosefunctions, such as claim entry, processing and payment across theapplicable processes. Then, stack-rank them based on immediacy andscale of payback. Create an RPA intake model that will soon providea self-funding mechanism to pay for further RPA efforts, as well asthe deeper automation technologies required for the more complexscenarios.

Related: Here's how auto technology will changeclaims

By thoughtfully planning your approach, you will set yourselvesup for success.

Paul Krauss is FSI Technology Practice Lead at NTT DATAServices. Dilip Kumar is FSI Director at NTT DATAServices. John Petrusick is FSI PrincipalConsultant at NTT DATA Services. To learn more,visit nttdata.com.