The robotic process automation (RPA) services market is highly competitive. New RPA services customers often purchase low-spend, low-profit engagements like RPA implementation, but more substantive revenue comes from customers who scale hyperautomation into higher spend, long-term engagements. To succeed within the RPA market, providers and firms must scale the spend of existing customers.
As the RPA market matures, successful systems integrators (SIs) add capabilities that align to common customer hyperautomation journeys. This has led emerging RPA-focused SIs to diversify into one or more of three routes: process automation, AI-packaged solution services or managed automation services. To differentiate within the RPA market and create new revenue streams, RPA service providers should capitalize on the growing hyperautomation trend and explore expansion into these three potential new services offerings.
Route 1: Process Optimization Services
When first buying RPA services, many organizations want a tactical solution to automate specific tasks, such as third-party websites where user interface interaction is the only option available. The most common buyers are mid to senior-level managers within functions such as finance, accounting, supply chain or HR.
Clients realize over time that RPA-based task automation provides limited benefits. Buyers that would value process optimization services are generally large organizations in process-focused, regulated industries. Banking and manufacturing are the most common industries, followed by insurance, healthcare, consumer packaged goods and the federal government.
When bringing process optimization services to market, tech CEOs should not try to explain this technology, but rather craft short and direct service descriptions to potential customers. These descriptions should explain what problems process optimization services solve and why the customer needs them.
Route 2: AI Packaged Solution Services
Gartner has found that artificial intelligence (AI) and machine learning (ML) are the top technology that enterprises are most likely to implement by 2025. To capture this growing demand, RPA services firms have been expanding into AI packaged solution services that further automate business processing activities. For most RPA service providers, solution-focused AI will be the fastest and least expensive route into AI services.
Tech CEOs expanding their product portfolio into AI services should start by identifying where they have deployed RPA within their customer base. The goal is to invest into products, partnerships and training in AI solutions that could be upsold to existing RPA services clients.
Similar to RPA implementation services, mid-level to senior-level business buyers are the ideal target for AI services. For more sophisticated customers, RPA services firms should target centers of excellence for domains like automation, data and analytics, or AI. Since the target of these services are business buyers, RPA services firms need to coordinate messaging about their services around improvements to the key performance indicators their target buyers are measured against.
Route 3: Managed Automation Services
Customers buying RPA implementation services need ongoing management and support of their automations. Many organizations rely on internal teams to provide this capability, but eventually they will be forced to question whether automation management and maintenance are value-adding activities or should be outsourced to lower-cost external providers.
Customers that begin with RPA implementation services do not typically buy managed automation services at the same time. Budgets are limited, RPA hasn’t been proven in the organization, and most customers want to bring maintenance in-house when they develop their RPA capabilities.
Given customers’ needs, tech CEOs require several resources to launch managed RPA services. A minimum requirement is access to low-cost offshore labor for monitoring, operations and basic automation break-fix support. Additionally, personnel experienced with managed services contracts can set appropriate customer expectations. Lastly, tech CEOs must carefully evaluate how quickly the business can reach profitability. Managed services businesses require scale, meaning a minimum number of clients are needed to reach basic profitability. Cost management is critical for launching and sustaining managed RPA services.
RPA and associated automation services maintain high demand due to customers’ increasing interest in hyperautomation. Process optimization services, AI solution services and managed automation services all align to growing customer demand and offer reasonable risk versus the potential returns.
Arthur Villa is a Sr Director analyst at Gartner Inc., where he covers robotic process automation (RPA) and hyperautomation targeted at tech CEOs, product managers, and product marketers in IT service providers. Gartner analysts are presenting additional insights for tech CEOs at Gartner Tech Growth & Innovation Conference taking place June 14-15 in San Diego, California
