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Why FS Leaders Struggle to Win at Automation

By Gladys Yeo | August 08, 2022 | 0 Comments

Financial ServicesFinancial Services Digital Business Strategy and InnovationFinancial Services Go-To-Market Strategy and ExecutionFinancial Services Operational Excellence and Cost OptimizationFinancial Services Talent Management, Leadership and CultureFinancial Services Technology Modernization and Transformation

Speak to any financial service leaders involved in their firm’s automation efforts and they will likely say at least one of these three things (along with a tinge of exasperation and fatigue): 

  1. Their firm plans on increasing its dedication and adoption of automation. 
  2. They are constantly bombarded with stories and use cases of how technologies such as robotic process automation (RPA), natural language processing (NLP), artificial intelligence (AI) and machine learning (ML) have reduced headcount, saved money, and improved customer service in banks and other financial institutions. 
  3. There is a tremendous leap with significant complexities required to turn use cases on a page into a real-life solution for their firm.

The current market conditions aren’t quite helping either – the talent crunch, deteriorating profit margins, and rising inflation compound the challenge faced by executives as they make decisions in their automation initiatives. 

In a recent Gartner peer forum, financial services leaders discussed and shared about the current state of automation, some of the key challenges they face in their automation journey and the evolving role of employees in automation initiatives. 

Most have achieved quick wins but STP remains elusive

In the initial phases of their automation journey, projects were prioritized based on the number of processes/people who would benefit from automation and leaders pursued quick wins in pocketed areas to win support for the firm’s automation initiatives. For example, automating return mail, taking in and scrubbing forms, request for new credit cards. While leaders acknowledge that quick wins were cost-savings initiatives and not growth bets, quick wins were necessary for firms to overcome the initial learning curve as well as socialize the benefits of automation. Today, leaders continue to find ways to scale these solutions across many similar processes to maximize impact. However, they’ve begun to explore solutions that involve more complex automation efforts in the pursuit of straight-through processing. 

This journey towards end-to-end process automation is not without struggles

  1. Building a business case for end-to-end solutions is comparatively more difficult. The quick wins achieved with RPA implementation established precedence of fast ROI and scalable solutions, which makes it more challenging for FSI leaders to justify and build a business case to acquire talent and resources for complex end-to-end automation, particularly with tough market conditions. 
  2. The dichotomy between  “problems was either too small to make a difference” or “too big/complex and required a huge team”. While firms have made inroads in their automation journey with quick wins, many processes and tasks along the value chain still require manual intervention, all of which are ripe for automation but involve significant complexity that FS leaders have yet to crack. 
  3. Arbitrary definitions of success can sometimes hinder progress. “What is considered a win?” “Where do you draw the line of success”. Executives share that differing definitions of success make it difficult to calculate ROI. For example, automating 20% of a process would be considered a win by some stakeholders, but others expect 100%. 

Robust prioritization unlocks the value of automation 

While investing in a comprehensive toolbox of technologies is critical for firms to make inroads in their automation journey, leaders share that decision paralysis is often the real limiting factor. Leaders highlight the need for a robust prioritization matrix and a well-defined operating model to guide the socialization and production of automation projects.  

  1. Robust prioritization criteria should go beyond potential cost savings and volume. FSI leaders have evolved their automation prioritization criteria to include metrics such as:
      • Will this automation enable growth without adding headcount? 
      • Does this automation create a consistent customer experience? 
      • Is the process stable? 
      • What is the number of employees impacted by RPA? 
      • What is risk remediation potential? 
      • Is there a strong commitment from the sponsor of the request? 
      • Will we need to replace this bot in 5 years? Is this a temporary solution?
  2. Managing stakeholders is an ongoing endeavor and a balancing act. FS leaders noted that while prioritization is important, it isn’t always as straightforward. Stakeholder management throughout the discovery phase can challenge especially when lower-priority projects repeatedly request more resources. As a result, some leaders must re-prioritize resources to appease key stakeholders even as projects are ongoing.c

Talent is a key constituency in automation initiatives 

As firms evolve their automation governance model and approach towards automation, FS leaders highlight the key role that talent plays. Employees are fast becoming key constituents in how decisions are made. Some firms have expanded their automation prioritization matrix to include employee-focused metrics (e.g.number of employee groups impacted by automation, the potential of automation to improve employee engagement). Other firms note the benefits of increased productivity and technology adoption rates when employees are involved early on in the discovery and conceptualization phase of automation projects. FS Leaders are also constantly evolving their change communication efforts to tailor to the attitudes and beliefs of employees, as opposed to change communication efforts simply based on work impacted by automation. 


In summary:

Making inroads in one’s automation journey seems to be fraught with challenges and difficulties. Furthermore, tough market conditions pressure leaders to make tough trade-offs between investing in capabilities that create operational efficiency, versus ones that support long-term growth. To learn more about how Gartner supports FS leaders through the above-mentioned challenges, see:


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