Automation proved to be an effective tool during the pandemic helping companies become and remain resilient. In the current macroeconomic environment that is clouded by the looming recession, companies are once again leaning on Automation technologies to help them unlock efficiencies and enhance the experience of their key stakeholders – customers, employees, and partners. Along with Automation, companies are also investing in other modern technologies such as Blockchain, Quantum Computing, and the Metaverse which is propelling them into the next phase of digital transformation – DT 2.0.
One of the primary goals of Digital Transformation 2.0 is to elevate existing enterprise SOR (Systems of Record) applications to SOX (Systems of eXperience) that can help deliver on the integrated experience outcomes that companies are targeting. In addition to the business outcomes being sought, the understanding of the technology stack for Automation has also significantly matured in the current ecosystem. Enterprises are taking a holistic approach to Automation, which is creating the shift from SOR to SOX. The boundaries of Automation are being pushed by Generative AI algorithms, helping serve existing use cases more effectively and making way for newer use case possibilities.
Zinnov Zones for Intelligent Automation (IA) Platforms – H1 2023 – the industry’s first, most comprehensive, and best-in-class assessment for Automation platforms is aimed at gauging how equipped platforms are to cater to the rising demand for Intelligent Automation by enterprises. We have exhaustively analyzed 100+ platforms and specialist vendors on their technical prowess and scalability parameters to identify the kingpins and visionaries. The study rates the players based on overall capabilities across the Automation lifecycle. The platforms were evaluated across six categories including Intelligent Automation (IA), Process Intelligence, Intelligent Document Processing (IDP), Robotic Process Automation (RPA), Low Code Application Development and Intelligent Virtual Agent (IVA).
In line with the changing paradigm in the space and the ever-evolving philosophy of Intelligent Automation, 7 platforms emerged as leaders in the overall HIA category – UiPath, Nintex, Microsoft, Kofax, Appian, ServiceNow, and Pega. These integrated platforms have showcased immense focus on building end-to-end capabilities across the Intelligent Automation stack to enable enterprise-wide deployment through consistent product innovation, strategic investments to expand market footprint, and building ecosystems around their platforms.
Based on our in-depth interactions with platform company CXOs, enterprise decision-makers, service provider practitioners, and industry SMEs, there are eight key trends that we believe will shape up the Automation landscape in 2023 and beyond.
The first phase of digital transformation of companies was defined by technologies such as Cloud, Mobile, analytics, and Social. In the age of Digital Transformation (DT) 2.0, the overall goal of businesses shifts from shareholder value to stakeholder value. Using technologies such as Intelligent Automation, Mixed reality, Quantum Computing, Blockchain, 5G, among others will help deliver this superior experience for all enterprise stakeholders.
According to a recent Zinnov survey of 250 enterprise CXOs, Intelligent Automation emerged as the top technology area that CXOs are prioritizing within their DT charters, clearly establishing Automation as the core technology powering DT 2.0.
The ‘magical’ capabilities of ChatGPT from OpenAI caught the attention of people worldwide as it became the fastest scaling digital platform acquiring more than 100 million users within the first couple of months of launch. The technology powering ChatGPT, ‘Generative AI’ holds immense potential and is already starting to see leverage in the Automation of business and IT processes.
In fact, there are over 200+ platforms that are using Generative AI for wide-ranging applications. Generative AI models are augmenting capabilities of IVA platforms, enabling accelerated training for intent recognition with its ability to handle complex and nuanced conversations in a human-like manner and overall increased accuracy for incoming queries. This can be especially useful in functions such as Customer Service, where voice and text-based virtual agents handle a wide range of inquiries and requests. Additionally, Generative AI is revolutionizing application development as well with its ability to seamlessly write code based on instructions given in natural language.
Enterprises are exploring Metaverse for a more immersive medium for customer (and in some cases, even employee) touchpoints. Intelligent Automation will be central to powering enterprise SOX (Systems of eXperience) to create dynamic superior personalized experiences across channels – Physical and Digital, including the Metaverse.
Fashion brands such as Gucci are looking to explore growth through the Metaverse where it offers customers virtual products to dress their avatars. This scenario can be further extended to also provide the same products and designs in real life, as Automation technology is helping integrate the e-commerce systems with the supply chain of the physical product to reach the customer; a product that they bought based on its virtual appearance. Subway is another company that has filed for patents to setup a store in the Metaverse that offers both virtual food, drinks, NFT-backed media, and food delivery services. Automation technologies such as RPA, intelligent virtual agents (IVA), API, low code app development, etc., will be leveraged to build this in a rapid and effective manner.
As companies move towards more complex industry-specific use cases and demand higher returns from their Automation investments in terms of both efficiency and experience, they are shifting their focus to more specialized, best-of-breed platforms. Horizontal platforms are simply unable to cater to the diverse demands by enterprises or require huge amounts of development effort for automation of processes.
Further, with the Automation platform ecosystem comprising 1400+ companies, there is a conscious effort being made, to differentiate specializations across technologies, industry verticals, horizontal segments or user personas. For example, CVS Health used a specialized supply chain platform, Blue Yonder to automate production planning and scheduling. The company also brought in specialized RPA capabilities from Pega to streamline reporting, analytics and billing related processes and tapped Nintex capabilities to automate Ops workloads. Such hybrid models are resonant of how companies are finding the appropriate specialized platforms for certain workloads.
While Process Intelligence (PI) has wide ranging applications across business operations, the most important use of the technology is in helping companies unlock the power of Intelligent Automation. In Zinnov’s recent CXO survey, over 50% of enterprises are using PI tools to aid their Intelligent Automation efforts, a significant increase from just a 30% penetration a couple of years ago, in 2020. Currently, enterprises are spending upwards of USD 400 Mn annually on Process Intelligence tools. This spending is expected to increase at a steep CAGR of 75% as adoption levels rise at a rapid pace.80% of enterprises are expected to be using Process Intelligence solutions by 2024.
PI platforms are enabling the Intelligent Automation continuum, right from creating a process system of record, prioritizing processes for automation, designing agile configurable workflows, developing automated processes to continuous and real-time monitoring of processes. However, PI tools alone cannot suffice and a hybrid approach that augments output of PI platforms with business context and inputs from process SMEs is best suited for enterprises.
Major technology companies such as Salesforce, SAP and ServiceNow have dominated enterprise IT landscape with their platforms (CRM, ERP and ITSM respectively).They are being used as the primary System of Records (SOR) across the corresponding enterprise departments. Today, these technology giants are fast scaling their prowess in Intelligent Automation through organic and inorganic investments into technologies such as RPA, Low Code/No Code, IDP, API, IVA, Process Intelligence, etc.
Enterprises look to elevate their SOR applications to Systems of Intelligence (SOI) to connect siloed systems and aid faster decision-making. The larger goal is to improve these systems into systems of experience (SOX) to orchestrate back office, middle office and front office processes, providing the best experience to all enterprise stakeholders – customers, employees and partners. Tech giants are embedding Automation capabilities into their core platform offerings to enhance their platforms into towards SOX applications.
Most major platforms have been focused on offering horizontal capabilities around Automation technology areas. However, with enterprises looking at Automation as a strategic lever of change, platforms need to solve for core industry challenges. They must showcase domain expertise and demonstrate the measurable ROI that they can deliver. Leading platforms are investing in developing a verticalized solution stack and building both direct and partner-led GTM engines; these are meant to target industry verticals.
For example, ServiceNow has been executing on a structured roadmap to develop its industry-aligned messaging and accelerators since 2020. Similarly, UiPath has onboarded domain experts focused on target industries and is collaborating with partners to develop vertical solutions for top use cases. Other platforms such as Jiffy.ai have structured their direct go-to-market motion with target industries.
Enterprises are constantly looking for effective technical capabilities around Automation technologies that have a deep domain understanding along with a flexible and agile delivery model. This is where a new breed of boutique Automation service providers have emerged to address these needs from the demand side. In Zinnov’s recent CXO survey, 34% respondents indicated their preference for boutique service providers for Automation deployments.
Platform companies are also gravitating towards these partners by onboarding and co-investing in building joint capabilities. In fact, some platforms have even forged exclusive partnerships with boutique service providers in the Automation segment, such as UiPath’s partnership with EAS, OutSystems’ partnership with Do iT Lean and ServiceNow’s partnership with DxSherpa.
The Automation platform space is witnessing an immense technological evolution including the growing prominence of the convergence of Automation technologies and AI with humans at the center. There will be more scenarios where Automation across the physical and digital world like the Metaverse will come together for end-to-end process automation, and enhanced business value. Newer technologies such as Quantum Computing and Web3 are expected to come of age, and will play a bigger role in tandem with Automation. As leaders in the segment are only now being defined, IA platforms are acting on the imperative to accelerate innovation intensity and explore pioneering approaches to fast capture business opportunities wherever possible.