Here come the robots

Apr 01, 2019
Robotic process automation has had a limited impact on shared service centres, but all that is about to change.

It isn’t often that an initiative comes along which can revolutionise an entire industry. Much like the first iPhone, robotic process automation (RPA) is expected to have a significant impact on how various accounting functions operate in the future.

Limited positive impacts for shared service centres

It is clear to see how technological advancements have influenced our day-to-day lives in recent years, from Alexa ordering your take-away and telling you the daily weather forecast to the countless number of apps that help to make our lives that little bit easier. So far, this impact has not been replicated in the daily activities of the shared service centre. For the most part, changes in this sector have been relatively small with only a minor impact on the roles of Chartered Accountants.

Cost-saving initiatives have focused on automation and the introduction of a lean/six sigma approach. These initiatives have helped increase efficiencies, lower costs and ultimately produce more rigorous reporting processes. However, with both automation and lean/six sigma, there are limitations to the potential efficiencies and cost savings an entity will generate. Most organisations have maximised the potential in these areas.

A new normal

RPA is the next big ticket item everyone is talking about, but as with all new things there is a sense of uncertainty. It is similar to the launch of the iPhone back in 2007 – people weren’t certain that it would be a success. People were unsure as to what impact it would have on society. And so, the same issues arise when it comes to implementing RPA. It will be slow to be implemented but once it is, it will have a significant impact on the accounting industry and specifically, shared service centres.

Robotics’ foothold

Significant advances in RPA capability mean that computers can now look after key areas of a shared service centre including accounts payable, where it has made a significant impact on the processing of invoices within the enterprise resource planning system; accounts receivable with credit collections, application of cash and the posting of journals; and the day-to-day general ledger function. The cost of implementing such systems can be high initially but given the cost saving attributed to labour efficiencies, it won’t be long before cost comes down.

Adapting to change

Even though RPA will be able to fully automate some key processes end-to-end, it is important to remember that they cannot fully replace the role of humans. Yes, robots are more efficient and cost less – but humans can think outside the box. What happens when there is an issue the machines can’t process? There will be a need to manage, monitor and constantly assess the outputs of these machines to ensure they are doing what they are meant to. Job roles will change and people will need to adjust. It will be a case of adapting to change, which we have done all our lives.

An exciting future

It is exciting to consider the full impact RPA will have on a shared service centre when fully implemented, and the results should speak for themselves. However, it is critical that Irish organisations are seen to be leaders in embracing this change and working with partner organisations to instigate efficiencies and synergies. 

To date, Ireland has been attractive as a location for shared service centres due to our multitude of talent and resource, and RPA is no different – we just need to access a new resource now to develop this area, hence the need to focus heavily on STEM subjects in third-level education in order to build a pipeline of professionals for this sector. This leads me to another hobby horse – STEM subjects must be promoted to our female population.

It is a fascinating area at the minute and the likelihood is it will continue to grow and develop significantly over the coming years.

Sinead Donovan is a Partner in Financial Accounting and Advisory Services at Grant Thornton.