Process Intelligence for Operational Resilience in Financial Services

The Covid-19 pandemic has exacerbated operational risks while increasing economic and business uncertainty. Pandemic-related disruptions have affected internal information systems, personnel, and facilities, as well as relationships with external service providers and customers. In addition, cyber threats (ransomware attacks, phishing, etc.) have spiked, and the potential for operational risk events caused by people, failed processes, and disrupted systems has increased as a result of greater reliance on virtual working arrangements. 

To help the financial industry improve its ability to survive future disruptions, the Basel Committee on Banking Supervision (BCBS) recently issued Principles for operational resilience. It aims to make financial services institutions (FSI) better able to withstand, adapt to, and recover from severe adverse events. Similar guidance has been rolled out by the Prudential Regulatory Authority, Financial Conduct Authority, and other regulators. The goal is to provide additional safeguards for the overall financial system.

Operational Resilience Requires Detailed Process Understanding

The BCBS defines operational resilience as the ability of an FSI to deliver critical operations through disruption. The principles cover topics ranging from governance and operational risk management to business continuity planning and cybersecurity, including activities performed for third parties. The principles have also been expanded to include processes which, if disrupted, would be material to the company’s continued operation or its role in the financial system.

In other words, it’s critical to understand every process that makes an FSI tick.

Mapping the Connections

Of particular note is the document’s fourth principle, which provides guidance on mapping the interdependencies of internal and external processes. It states that FSIs should not just identify critical operations, but “map the internal and external interconnections and interdependencies” to truly understand how they deliver critical operations.

BCBS further implores FSIs to go deeper than just the tasks and steps to identify and document the people, processes, technologies, information, facilities, and more, including those of third parties. It further calls out the need to define “interconnections and interdependencies” among all these components as they relate to an FSI’s ability to deliver critical operations.

Capturing this level of detail, at scale, is a daunting task even for smaller FSIs. The typical manual process mapping and application log file-based process mining efforts are too slow, too expensive, and too limited in their scope. 

Process Intelligence Accelerates Operational Resiliency Initiatives 

FortressIQ Process Intelligence uses computer vision, machine learning, and artificial intelligence to effectively capture and discover the details of every process, who performs it, using which applications, and the output generated from it. 

Yes, FortressIQ maps and documents the people, processes, technologies, and information behind every process. Best of all, it captures this process intelligence in just weeks, comprehensively and accurately, without expensive and long engagements. And, it highlights process variances across workers due to differences in experience, training, or other factors.

FortressIQ also documents the people and processes using legacy, home-grown, and user-generated tools, and even productivity tools that lack logs, such as email and spreadsheet apps. FSIs spend millions of dollars buying, building, and maintaining these customized and third-party systems, but allow risk to be introduced as end users conduct operation-critical work using end-user computing tools (EUC), which are outside of core systems. These EUCs can help make day-to-day work faster and more efficient, but the operational and continuity risks associated with EUCs cannot be understated. 

FortressIQ Process Intelligence requires zero integration, works without disrupting employees, and captures granular process details. Process data is then decoded to provide actionable insights so FSIs can make faster, more informed decisions on the process optimizations, digital transformations, and cloud adoption that support resilience initiatives. 

Decode Work for FSI Resilience 

FortressIQ follows the human with automated process discovery, modeling, and documentation. It works everywhere business happens, capturing process data at the most granular level, performed on any application, with no bias or blind spots, and across global operations. It then presents process visualizations and dashboards across people, process, technology and information, allowing a view of the data from a broad perspective or focus on a single process thread, and empowering leaders to make data-driven decisions with increased confidence.

The Covid-19 pandemic highlighted the need for operational resilience, especially for FSIs. Given the critical role of FSIs in the global financial system, increasing their resilience to these types of black swan events also increases their ability to absorb the more likely and more common shocks of cyber incidents, technology failures, and natural disasters. Pragmatic operational resiliency provides safeguards for the financial system as a whole. But, it all starts by decoding how FSIs work today. 

FortressIQ can help. To learn more, visit our Resource Library.

Ripples Become Waves: The New Normal Of Supply Chain and Logistics Disruptions

Supply chain and logistics sit at the intersection of major economic and societal trends, such as rapid urbanization and e-commerce growth. Your customers compound the challenges by constantly demanding enhancements to shipping and logistics business processes to lower costs, improve service, and increase efficiency. Services such as freight forwarding, truckload brokerage, customs brokerage, order fulfillment, and returns management are all key to improve the efficiency of the supply chain management process, and your customers want improvements up and down the chain. But that’s increasingly challenging as those customers continue to adapt, competition rages, and the rate of change accelerates and impacts all parts of your business. The net effect is that the ripple effect of one decision could be the wave that overwhelms your business.

Disruptions Prevent Short Lead Times and High Fill Rates

Lead time is an important metric in logistics. It is measured from the time of order submission to the time of order receipt. An equally important metric is fill rate, which is defined as the percentage of orders shipped from inventory. The goal is for lead times to be as short as possible with minimal variability, and fill rates to be high given enough inventory is maintained to avoid stock-outs. 

The overall goal of logistics is to deliver the right product, at the right price, to the right customer, at the right place, at the right time, in the right quantity, and in the right condition. That’s a challenge and involves many processes across your business. But with challenges such as the pandemic, the recent grueling halt of hundreds of container ships in the Suez Canal, and sudden shifts in fuel costs and commodity price increases, it is clear that one isolated incident can quickly disrupt your entire supply chain.

Fight Demand and Supply Uncertainty with Insights

Traditionally, demand and supply were anticipated using various modeling techniques based on historical data. But 2020 changed that, probably for good. From a sharp drop in demand in the early part of 2020 to an acute supply shortage in the latter half of 2020, many global and local retailers, consumer products manufacturers, and logistics companies were caught off-guard. The disruption caused a significant reduction in revenue due to curtailment of business, an increase in expenses or a reduction in operating margins, reductions in operating effectiveness due to employees working remotely, unavailability of personnel, and much more. These are just a few examples of the widespread impact. 

To survive in this new normal, businesses will need to enhance their operating model, while others need to completely reimagine how they work. To thrive, you’ll need to do much more. Businesses must fully understand how each function and process contribute to the overall enterprise strategy and success, from connectivity to customers, call centers, warehouse management, inventory management, pricing, finance, accounting, returns (reverse logistics), amongst others. People, processes, technology, information, and facilities, and mapping their interdependencies and connectedness is key to driving operational resilience. But, these connections are also frequently the cause of complex and complicated manual processes or disconnected legacy systems and applications. This not only creates additional work, it increases operational risks, losses, customer dissatisfaction, and low employee morale. 

To improve, you must first find and understand these challenges, and that starts by decoding how your business actually works today.

How FortressIQ Works

By leveraging computer vision, machine learning, and artificial intelligence, and with universal compatibility requiring zero integration, FortressIQ disrupts the traditional process mining and discovery methods. Our solution captures and discovers all relevant process data in just weeks with automated business process discovery, modeling, and documentation. The result is data and insights across all organizational processes and which are unattainable with traditional methods.

Decode Work with Unmatched Visibility 

FortressIQ brings visibility into how operations, internal controls, and supply chains actually work. Instead of capturing limited process logs or conducting slow, expensive interviews, FortressIQ follows the human with automated business process discovery, modeling, and documentation. It then presents data and insights through process visualizations and reports, allowing you to view the data from a broad perspective, such as reviewing the most performed tasks or focus on a single process thread or sub-task. The ability to analyze processes at this precise level of detail enables data-driven decision-making for increased confidence. 

Adapt to Today’s Retail, Supply Chain, and Logistics Challenges 

FortressIQ quickly decodes work at every level, across every channel, and in every domain. Detailed current-state assessments let you make data-driven decisions by capturing tasks at the most granular level, with no bias or blind spots. This intelligence empowers you to improve your business by enabling fit-for-purpose solutions such as automating repetitive processes, system optimizations and replacements, increasing compliance and controls, standardizing processes, and much more. Even as systems change across brands, business lines, and regions, FortressIQ provides continuous and comprehensive insights so you can focus on sustainable growth. 

To learn more, join us for an interactive demonstration of how FortressIQ can deliver value to your organization in weeks, not months or years.

Prepare Yourself for Process Intelligence: Introducing FortressIQ Academy

Process intelligence lets you decode work to understand every task, interaction, and workflow so you can make better decisions, optimize processes, and empower employees to do more, more efficiently, and with fewer errors. 

Process intelligence is also fast, delivering detailed process data in just weeks, at enterprise scale, and across every app and system. But that doesn’t give you much time to get your hands on FortressIQ Process Intelligence to understand how to harness all of that power and data. Now, there’s no need to worry.

Introducing FortressIQ Academy

FortressIQ Academy empowers our customers and partners to quickly realize the immense value of FortressIQ Process Intelligence. It’s an efficient, phased training program to help individual users or global enterprises gain the skills necessary to understand, in accurate detail, how your business works at all levels.

With practical, hands-on training sessions, FortressIQ Academy provides instruction for all levels of learners.

  • Introductory modules help those new to process intelligence understand the concepts, technology, and data visualizations. 
  • Foundational topics provide process intelligence how-tos to enable fast results from process discovery and data mining, and the creation of process definition documents. 
  • Advanced courses empower practitioners and administrators with advanced tips and tricks for deeper event exploration and strategic business process analysis.

From the Comfort of… Anywhere

It’s a tricky work world out there, so FortressIQ Academy lets you take courses at the pace and location most appropriate for your needs and comfort level. Online, self-guided courses are available to help you quickly develop proficiency with FortressIQ. Instructor-led training is also available, which is especially beneficial for larger teams or specialized use cases.

Start Learning Process Intelligence Today

FortressIQ automatically and continuously captures your business process data, at scale, and across every enterprise system. It provides a clear and accurate view of how your business works today. But that doesn’t give you much time to get up to speed on how to use process intelligence insights to execute business process automation, accelerate digital transformations, or ensure the sustainability of enterprise optimizations. 

So get started with FortressIQ Academy today. To learn more, contact your account executive or partner representative today. 

Beyond Hyperautomation: What’s Next in Automation?

When I explore trends, I avoid looking at the obvious advancements we will experience in the next 12-24 months. Those are too easy to predict. But I also try to avoid the science fiction range of looking 10+ years into the future. While the concepts may be fun to consider, they are meaningless to most organizations today because their potential value is not yet tangible and their likelihood of commercialization is limited. The sweet spot for impactful trend spotting is really in the 3-6 year range. You have enough time to plan and course correct, plus you can assess the realistic impact on the business with some certainty.

We’re now at a point where automation should be returning huge dividends to those that deploy it. But why it’s falling short isn’t due to a lack of trying or a lack of deployment speed. Instead, accelerated approaches, like hyperautomation, and even regular old automation itself, won’t reach their potential until organizations have the right ingredients in their approach to automation. 

Unsafe at Any Speed

Hyperautomation burst into the technology lexicon when Gartner named it the Top Strategic Technology Trend for 2020. But, there is a lot of nuance to the meaning of hyperautomation. Gartner defines it as “the application of advanced technologies, including artificial intelligence (AI) and machine learning (ML), to increasingly automate processes and augment humans.” It complements intelligent automation but provides higher-level functioning, which enables more predictive analytics and adaptive decision-making. 

Hyperautomation sought to address many of the challenges companies faced when scaling their robotic process automation (RPA) programs and re-igniting excitement in the technology. Despite strong market growth, there were cracks appearing in the foundation. HFS Research’s Phil Fersht, ironically the analyst who introduced RPA to the world in 2012, declared the technology dead in his famous 2019 blog post. At the time, only 4% of companies had deployed more than 50 bots, and a Deloitte survey of 400 global firms found that 63 percent of surveyed organizations did not meet delivery deadlines for RPA projects. Regardless of how long it took, an EY study found 30-50% of initial RPA projects fail. 

Hyperautomation was introduced to address all of these shortcomings in the market with its suggestion of speed. Unfortunately, as we all know, speed can kill.

More than a decade before the concept of RPA was even introduced, Microsoft’s Bill Gates taught us in 1996 that, “The first rule of any technology used in a business is that automation applied to an efficient operation will magnify the efficiency. The second is that automation applied to an inefficient operation will magnify the inefficiency.” 

This lesson still largely holds true today, and unless enterprises deeply understand their processes first, any efforts at automation will be less than successful. Hyperautomation just accelerates the path to magnified inefficiencies.

The Future is Better…and Faster

So what’s in store for automation once industry and practitioners get over their thirst for speed? First, they need to focus on solving the business issues that RPA is not addressing today. Only then can they make transformational progress on automation and get past the abysmal deployment and failure rates. Here’s how I see this situation resolving itself.

In my sweet spot near future timeframe of 3-6 years, I predict three major ideas will influence the next generation of automation technologies.

  1. The first is CONTEXT. To help address the issue of blindly automating an inefficient or incorrect process, you need better context. Having observability into the current state of operations will drive better decisions and better outcomes. You have to be able to understand today to improve tomorrow. Through a mix of AI-enabled technology systems, organizations will have increased awareness of their operations and will be able to make more informed, data-driven decisions. Automation activity will no longer just be fast, it will be fast and correct
  2. The second is CONTINUOUS. All the current process technologies, with a few minor exceptions, are timeboxed. They are episodic. In today’s world, any core data system you are using to run your business has to be real-time and continuous. You do not run your security software for two weeks and then turn it off. Or you do not turn your web analytics on and off based on the data you are looking to explore. We’ll see this shift in automation as well. Organizations, applications, and processes are evolving constantly. And, if we are always just looking at a snapshot to drive automation, we are undoubtedly missing something.
  3. The third idea is COORDINATION. While this aligns with the letter C theme, it is really more about orchestration and how the systems, applications, and workflows integrate together to create better outcomes. They can self-adjust based on the changing conditions and requirements to work together more efficiently. Orchestration includes human-agent partnerships and managing the new digital workforce. This will really move us towards a next-generation operating model and a more autonomous enterprise.

Automation success requires a deep understanding of business operations, which are continually updated to account for change and adaptation, and which are utilized to orchestrate every aspect of the workflow and business. I hope they’re not termed  “hypersonic automation”, but regardless of how the marketers decide to frame the next generation of automation technology, it will be more data-driven to better support key business initiatives across the enterprise.

RPA Is Just One Piece of the Automation Puzzle

With any technology experiencing massive adoption, there is no shortage of unwarranted hype. RPA is no exception as it has been the fastest-growing enterprise software category for the last three years. But, beyond the hype, RPA does deliver significant value and can radically transform how your enterprise works. You just need to realize what to expect of RPA before it’s unleashed.

Hype Leads to RPA’s Perceived Failure

The biggest fallacy fueling RPA’s hype machine is the term itself. It is not robotic process automation. More accurately, it is robotic task automation. The misnomer is responsible for some of the challenges the technology has faced in terms of scaling across the enterprise. The vast majority of companies that have deployed RPA still can’t get more than 10 bots into production.

Another major misperception for RPA is that automation will reduce operating costs by eliminating headcount. There is no doubt RPA does enable a team to do more with less, but promises of fewer resource requirements too often fail to materialize. Companies need to think more about the impact on employee experience and the value those employees deliver. RPA does a great job of automating low-value work so employees can focus on high-value activities. 

Finally, despite its reputation as a panacea for many enterprise ills, RPA often adds to an organization’s technical debt, which will eventually be a problem someone has to correct. There is no doubt RPA is fast, efficient, and less expensive than other methods. But, it’s more of a band-aid than a cure. 

For example, with analytics workloads, in particular, data is often generated in legacy mainframes and RPA is used in place of costly API integrations and other fixes. It provides a temporary fix to get a few more years out of a legacy system. Yes, it avoids a costly, time-consuming, and error-prone system upgrade. But it ignores the less obvious costs and inefficiencies associated with maintaining the legacy application, like performance, compliance, and security. These issues would typically be addressed by an upgrade but are too often pushed off by deploying RPA as an interim solution. 

Focus on Automation’s Value

The grand promise of RPA so frequently falls short due to over planning, the inability to identify key automation opportunities, and a disproportionate focus on short-term objectives to show wins even if they’re not aligned with corporate objectives. This is why many organizations spend 12-18 months before getting a single bot into production. 

Today, automation is the new transformation. After a decade or more of mediocre success rates and an overemphasis on customer experience initiatives, automation provided needed relief to address the transformation fatigue that many companies faced. Fortunately, RPA is not the only automation technology available to drive business value. 

Automation technologies are quite flexible and are being implemented across a wide variety of settings, from structured transactional activities to end-to-end processes. Use cases across the enterprise can be addressed using a variety of technologies. In addition to general user interface (UI) layer tools like RPA, there are domain-specific tools available to support various functions, like marketing automation. Other tools focus on data extraction to capture unstructured data and make it more usable. Technologists also have digital process automation platforms available to address deeper and wider workflows, and more traditional APIs can be used to integrate enterprise systems.

4 Automation Prerequisites

Regardless of the automation technology deployed, there are four vital actions to take before your company or department invests time, energy, and budget into a project. 

  1. Assess the overall process complexity. Insights on the applications involved and the amount of human expertise required will help guide technology selection and determine the feasibility of success. 
  2. Decide if the process is mission-critical or if you are automating just for the sake of automating. 
  3. Identify key metrics that will define a winning result. Whether it is speed or scale or accuracy or efficiency, you want to establish the goal in advance so you know when you can celebrate. 
  4. Proceed only with fully detailed process documentation. To improve tomorrow, you need to understand where you are today. It’s common sense. No one says they are going to lose 20 pounds but do not know how much they currently weigh. Unfortunately, too many organizations try — and fail — to automate a process that they do not fully understand how they complete today.

It all makes sense. Before you begin, you need to know where you’re starting from, where you’re going, and how you’re going to get there. Automation is no different. And, if you truly want to succeed in transforming how your business operates, you must realize RPA is just one piece of the automation puzzle.