Are we fascinated with robots? Surely, Hollywood is.
From the movie “Metropolis” in 1927 and through the years with “Star Wars,” “Terminator,” “The Matrix” and many more, robots have captured our imagination and box office dollars.
Now they’ve come off the screen and landed in the asset management space. However, these robots are not suitable for the cinema. They’re invisible, yet they could be assisting asset managers in many ways. They’re not robots in the physical sense, but rather forms of automation software.
You may not see them, but you will see their output. They could help firms work faster and more efficiently. As such, they can transform operations in the form of robotic process automation (RPA).
What could RPA do for asset managers?
The asset management sector is fertile ground for RPA. It stands to reason when you consider that “low” is the prevailing descriptor in the industry, as in low interest rates and low economic growth. Along with changing investor preferences, asset managers have been hard pressed to seek avenues to enhance performance and their client experience.
At the same time, technology has zoomed ahead. With it comes innovations in the automated, digital and artificial intelligence domains. These advances might serve as solutions for middle- and back-office teams in asset management.
Put the last two paragraphs together. And it’s the short back story of how RPA has made its way to this industry.
What Is RPA?
RPA refers to the use of technology to run processes or segments of processes on core business applications. Here’s how it works. The technology hovers over the process. It follows assigned steps. It produces needed results and validations. Sound familiar? It’s just what humans do.
In the asset management sector, repetitive, manual work is not the best use of knowledgeable staff members. With RPA, they can move on to other activities. In other words, RPA empowers asset managers’ most important resources through technology. It enables firms to do more with available staff, and staff to do more challenging value-added assignments.
Are all processes and workflows targets for RPA? No. It’s ideal for work that is simple, intensively manual and high volume. Add to that tasks that are structurally repetitive with low exception volume and a high likelihood for human error.
Examples of RPA in middle- and back-office functions include:
- Time/Resource Planning: Digital assistants manage resources/staff for peak volumes
- Regulatory: Authenticate Anti-Money Laundering/Know Your Customer requirements
- Trade Processing: Automate trade exception handling and create/send email messages
- Cash Forecasting: Automate rules-based processes across timeframes, link to other areas
- Reconciliation: Retrieve data from external sources, trigger queries and perform matches
As noted, activities that are time consuming and recurring are ripe for this treatment. In these and other examples, RPA drives efficiency and upgrades productivity, quality and resiliency.
At what price? RPA achieves these benefits in a cost effective manner. When implemented at scale, RPA payback can occur in as little as three to six months.
More to Come
RPA is new and abstract. And it requires a different mindset. But it has arrived in the financial services world and, within it, is helping asset managers address their needs in a difficult environment. Invisible and intelligent, the robots in our realm are real in principle and practice. They are taking over the portion of work that is tedious and time consuming, and freeing human resources to take on more challenging responsibilities.
For more information, read InsideOps: Robotics is Transforming Operations in Asset Management or contact me at email@example.com.