Intelligent Automation as Innovation

How to diffuse Intelligent Automation

Intelligent automation or hyperautomation can be defined as “computer-based intelligent programs enabling the automation of knowledge work”. (Bornet, Barkin, & Wirtz, 2020) It includes Robotic Process Automation, AI, Business Process Management (BPM), and cloud, digital platforms.

Essentially, these are all innovations. And there are two big models when it comes to adoption of innovations. The first is the model the model developed by Venkatesh and his colleagues. The second model is developed by Rogers. Let’s discuss them.

Both are empirically tested. Both are focused on human behaviour and change management. We will try to combine them in a new model. In the next table you find the variables in both models.

Unified Theory of Acceptance and use of technology (Venkatesh et al., 2003)	Diffusion of Innovation (Rogers, 2005)
Performance expectancy	Perceived attributes of the innovation
Effort expectancy	Communication channel
Social influence	Nature of the social system
Facilitating conditions

My own comparative analysis of the two most published theorical models in adoption of technology

Venkatesh and his colleagues use concepts like perceived usefulness, extrinsic motivation, job-fit, relative advantage and outcome expectations to define performance expectancy. Effort expectancy was defined by perceived ease of use, complexity, and ease of use. Social influence is based on concepts like image, subjective norm and social factors. Social factors refers to how much other individuals in the “social system” are using or supporting the technology. Facilitating conditions incorporated concepts like perceived behavioral control, compatibility and objective facilitating factors in the environement.

Rogers argues that nature of the innovation, communication channels and presence of a social system are key factors when it comes to the diffusion of innovations. Relative advantage, trialability, compatibility, observability, and complexity are used to explain the perceived attributes of the innovation, in our case intelligent automation. When it comes to communication channels, mass media or interpersonal are key channels. Also the communication process has five stages: knowledge, persuasion, decision, implementation, and confirmation. The social system is explained by concepts like communication structure, norms, roles likes change agents and opinion leaders, and type of decision, which can be voluntary, consensus or mandated. Success of opinion leaders and change agents is explained by the effort to contact clients, orientation towards the client, client needs matching the technology, and the change agent having emphaty, credibility and homophily or perceived sameness. Rogers also identifies previous experience, felt need/problems, innovativeness and norms as prior conditions. Also, process is influenced by the characteristics of the innovation and the socio-economic factors of the individual like personality characteristics that guide information seeking and communication behaviour, referring to access to change agents. Different types of communication channels are perceived to be enablers for the whole adoption decision process, where new ideas spread from individual to individual.

Both models exaplain the first-time usage of new technology. However, in order to continue to use the technology, newer models need to focus on experience, enjoyment, and satisfaction as well as the utilitarian aspects that we already covered.

If we consider the most important fact of the first model to be performance expectancy and the most important aspect of the second model to be communication channels, then we can combine these two models and say that the organizations where people adopt intelligent automation are the organizations where people talk a lot about performance, about expected results, right? I made it super simple just for everyone to understand.

Well, yes, but not only that. According to Rogers, organizations that are innovative are organizations where leaders also have an attitude open and supportive to change. Also, there are several characteristics of an organization that determine the diffusion of innovation: centralization, complexity, formalization, interconnectedness, organizational slack, and size. Finally, organizational openness is important, like how much are individuals linked to other individuals in external organizations.

The Intelligent Automation hype

The Hype

When I started to work in RPA in 2017 as RPA developer, RPA was still an infant. Today, despite all the hype, it is still a niche of the software industry.

Does RPA help organisations to reduce cost? Definitely. With 10 people, you can support 100 scripts that replace 50 FTEs. How much did it cost to built those 100 scripts? How much does it cost the license and infrastructure? I would say one average script costs $15,000. License is $3,000 yearly, but for 100 scripts you need just 40 robots becasue one robots can run multiple scripts. I will exclude the cost of the VM for simplicity reasons. I will consider that an RPA developer and/or an FTE are paid with $25,000 per year. So let’s sum up. Cost is $250,000 yearly for support team, and the scripts cost $1,500,000 once at beginning. Let’s imagine amortization is 5 years. So yearly $300,000. So far, you have a cost of $300,000 + $250,000 = $550,000. Plus 40 x $3,000 for license of the software, this is another $120,000. All together $670,000 for year 1. Now let’s see the benefits. So we said 50 FTEs paid yearly with $25,000. This makes it $1,250,000.

$1,250,000 – $670,000 = $580,000 profit yearly. Not bad, right? However, the excitement is darkened by the fact that true transformation as a result of automation is hard. In reality, people will be the hardest to convince to use these bots. A big portion of those scripts won’t bring the actual benefits if the teams do not use them and prefer to do the things manually.

The hype excites a part of the organizational folks, and scares another part. We are very far away from a cristalization of the ideas about how to change business processes. Because the real benefit will not be from automating the processes, but from transforming them with machine learning. And to get there, you need a significant up skilling of the organizational people. If you tell your people now that they should use a number provided by the machine without teaching him or her how this new number is calculated by the machine learning algorithm, most people won’t use the new number to improve their process, to create new tasks around to improve the customer experience and benefits.

So, there is a big hype now, just check this graphic of the recent RPA job market, with exaggerating market and company values, exactly as we learned from Professor Willcocks, John Hindle, and Professor Lacity in their Octobe 2019 book on Becomming Strategic With Robotic Process Automation. There are daily new terms for basically everything related to software robots. On the other side you have scared people who resist any discution about automation, and they are talking constantly and very loudly with their management, and this gets middle management scared as well.

My first bot

I have been a developer at the beginning of my career in automation. I have developed a lot of crappy code that never made to production, but also good code that produces money even as we speak. But I don’t want to talk to you about this now.

What I wanted to tell you is how I built my first bot for myself. For myself as individual, for my own interest and profit and not for my employer.

I have tried many times the data scraping function. I have first tried to find the average price of apartments in my city, Budapest, Hungary. Then I scraped Amazon to find the price of books in the non-fiction category. I was playing, I was exploring and having fun.

But truly the first serious project that I am still working for is the weekly process to find the average number of RPA jobs on the market. I am very proud of this project.

I am following the RPA job market since 2019. I started with few bots, each bot following a company. Now I am at around 400 bots, for 400 different companies. These bots were always scheduled to run on Sundays, between 3-6pm. This report has been created by going to the careers page of big companies and typing “RPA”. The number of resulting vacancies is extracted. This has allowed me to take the pulse of our industry in the last two years, and notice the explosion of the RPA jobs market in the last half year, but especially in the last two months.

The results will be always update here, where I post the last 4 weeks data. For the rest of the data, you will need to buy my forthcoming book on the challenges of RPA. This is a book that I’m marketing a lot these days. I think this will be the best book on RPA and its challenges so far. The reason why I am saying this is, first of all, this book was part of my MBA research, I have received feeback on it from academics, it contains 8 interviews that I did with people involved in automation work of projects so far and it contains the research that I am telling you. This research has been going on for more than 2 years. And last but not least, I have reviewed most of the literature that was available by the year 2020.

So, this is like an anthology and I highly recommend you buy it. There is not enough time to explain what I did there. I think it will be great for you to buy your own copy.

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You are a Product Owner

Here is the audio on Spotify if you prefer to listen to it:

“Relax”

In the life of a Product Owner, first thing you need to know is that you are helping your developers to build their own understanding of your product.

Second thing is that you are not the only PO in this world. You will need to collaborate with same level PO, that might know more than you do in this field. Be humble, you have to learn from each.

Third thing is that you build your product every day. This means to start those discussions on the new features of your product as soon as possible. Otherwise, you will forget them in the backlog.

Next thing is to breathe. There are so many things going on, and you need to take care of so many things, like Definition of Done and Definition of Ready. It’s okay if you skip those some Sprints.

The only thing that matters as a PO is to collaborate. Try to answer all your customers, as soon as they ask you something. Don’t jump with the solution, wait and talk because the solution will most probably appear by itself without you appearing as pushy. Pushy is something once you get it, it will follow you. Collaborate, it doesn’t matter if it is not your idea. It is the client’s idea and that makes the client happy.

You are successful as long as the others see you are okay. And this okay can mean a lot of things, but the most important is to breathe, to feel good, to listen to the others. If you don’t feel good in your shoes, if you are not relaxed, if you do not sleep well, most probably you are not okay because the rest see you are not okay. And you are successful if others say you are successful. This is a social game.

The other thing is the relationship with the Product Manager. With PM, you need always to come with ideas, you need always to have arguments for your ideas, because PM will push back. If he sees you have always ideas and something push these ideas because they are the really good ideas to improve the product, you will succeed. Trust me, this is tested already.

I have pushed ideas to PM and I apologized after meetings. PM told me I shouldn’t apologize because the idea was worthy to push it and it was a good idea. But good ideas are rare, and they always come if you are relaxed, you breathe, and you sleep well. Do you understand that?

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Automation Blog

Hey guys welcome to my Intelligent automation blog. The next months I will spread my knowledge about this topic, because as a product owner at a Fortune60 company and with 3.5 years of experience in this topic, I have some knowledge that I want to sell. In the next months I will publish my book about this topic also, so stay tuned.

Support me on Patreon

https://www.patreon.com/adrianfanaca