IT cost surge drives business automation | Information Age

Business are automating processes to reduce IT spend, a study has found. Source: Shutterstock

The pandemic’s online shopping surge has forced retailers to automate the processing of returns and refunds, according to new research that found automation has become easy enough to use that business leaders are adopting it without help from IT.

Fully two-thirds of the 900 businesses surveyed for Workato’s newly released Work Automation Index said they have five or more departments using automation tools, while the number of organisations with at least seven departments using automation has tripled since 2019.

Non-IT-related automations make up 75 per cent of automations this year – up from 60 per cent last year – reflecting strong adoption of workflow automation tools in business areas such as finance, human resources, sales and marketing, customer support, and others.

Use of automation to process customer returns and refunds – a once labour-intensive process that offers no direct financial benefit for businesses – had increased by 335 per cent since 2019.

That growth “is a strong indicator that we’ll see more emphasis on a smooth return and refund process in the coming year,” the report notes, “[which is] no surprise as online shopping remains the primary commerce channel of choice despite brick-and-mortar locations reopening.”

Automation is also growing in business functions such as recruiting (up 310 per cent), record-to-report business analytics (up 290 per cent), procure-to-pay in procurement (up 283 per cent), employee onboarding (255 per cent), and customer support (230 per cent).

By building rules-based automations that guide employees, customers and business partners through routine transactions, Workato CIO Carter Busse said departments are handling larger numbers of enquiries without having to add more staff – a particularly challenging prospect in today’s climate – or even having to bring in the IT department to set up the automation.

“IT teams are now becoming the less dominant automation creators within organisations,” Busse explained. “This demonstrates that when you have the right guardrails, the right governorship, and the right tools in place, business users can create automations safely.”

“From finance becoming the most automated department to HR seeing the value in automation to help improve the employee experience, we’ll continue to see this type of growth and adoption as automation becomes more accessible across departments”.

Entering the hyperautomation era

The push to automate repetitive business processes was already gaining currency before the pandemic, with workers worried about redundancies as IT departments worked hard to streamline their everyday operations.

However, as businesses are now being hit by multiple challenges at once – including limited availability of staff, increasing customer expectations, and a difficult financial climate – using automation to improve efficiency has become crucial to their survival.

Fully 80 per cent of IT leaders see automation as key to optimising costs and, Gartner recently predicted, fully 70 per cent of organisations will have automated their infrastructure by 2025 – up from just 20 per cent last year.

Gartner calls the trend hyperautomation – defined as “a disciplined, business-driven approach to rapidly identify, vet and automate as many business and IT processes as possible” – and has named it among this year’s most significant businesses challenges.

Automation among Workato’s customers corroborate new figures from Salesforce subsidiary MuleSoft, whose recent customer survey found 91 per cent reporting that business teams had increasingly demanded automation over the past two years.

Australian businesses were slightly ahead of world pace when it comes to automation, with increased demand driven by research and development, administrative, customer service, and finance and accounting business units.

Yet for all the enthusiasm about hyperautomation, most Australian companies recognise that actually implementing it remains complex, with 93 per cent admitting that overhauling their existing systems for automation could increase ‘technical debt’.

“Organisations across every industry want to automate processes and customer experiences as quickly as possible,” MuleSoft Digital Transformation Office global field CTO and vice president Matt McLarty said, advocating for a ‘composable’ approach to business and warning that “if they try to go fast with the wrong tools and techniques, they’ll actually impede true innovation.”

“It’s vital that organizations become more adaptable to technological change,” he said, “enabling them to build automations and connect data and applications in a holistic manner.

“Without taking a more composable approach, organizations risk compounding rather than reducing their technical debt.”