In our new study, The automation advantage, we surveyed 415 IT executives whose businesses are at varying stages of cloud maturity. Two groups were identified: “Fast Movers” (the 20% most advanced in applying automation) and “Followers.” More agile, profitable and efficient – the perks of joining the Fast Movers are numerous.
The signs are clear: it’s time to transform. But where do you begin? And just how necessary is it that your strategy accounts for both front and back office? Let’s dive in.
The race for the prize
Eighty-seven percent of respondents agree that automation is a competitive opportunity, with Johan Esbjörner, technical lead for the Cloud Center of Excellence at Husqvarna, going as far to say, “If we don’t spend time on automation today, we may be out of business in five years.”
Likewise, in our 2017 report Cloud Native Comes of Age, we found that the proportion of new enterprise applications built natively in the cloud will have doubled by 2020. And whether you hope to achieve continuous delivery, a tighter DevOps culture, or improved revenue – automating both front- and back-office processes is imperative.
While it may be tempting to simply automate the front office to benefit customer experience, 84% of businesses that place equal value in front- and back-office automation report increased revenue and lower operating costs.
Cashback for automation
For the banking sector, the correlation between profitability and back-office automation is clear. Despite enthusiastic front-office automation, many banks still rely on traditional manual processes behind the scenes – think pen, paper, and person. It’s slow, costly, and inconsistent – and for the administrators, it hardly seems fair.
McKinsey & Company have consistently called for greater back-office automation in banks, citing a 53% profit margin among those who have pursued it (compared to 26% among those who haven’t). And while years of regulatory changes, disparate silos, and procedural ambivalence have left the sector reluctant to change – one major bank estimated that up to 85% of its back-office operations could at least be partially automated.
The human touch
One of the most popular drivers for cloud automation is the freeing up of resources to focus on higher-value tasks such as faster provisioning of infrastructure and application deployment. As my colleague Charlie Li discussed in his piece Reshape the workforce: reskill, redirect, redeploy, this isn’t a threat to your talent, but a valuable opportunity to reskill, redirect, and redeploy.
The job market is already shifting focus thanks to automation, with demand for advanced IT and programming specialists expected to grow by as much as 90% by 2030. But while the future may be bright for coders, what about those in the back office performing routine support tasks?
As McKinsey reported, almost every back-office process can be automated, making it an ideal area of the business to free valuable resources. At Amazon, holistic office automation has not only enabled it to deploy powerful new technologies, such as chatbots, to benefit customer experience, but also to replace legacy processes with immersive, new omni-channel experiences that benefit employees and customers alike.
Agile release management
In his blog Enterprise DevOps and agility: The secrets to a successful cloud strategy, my colleague Gunnar Menzel explored the necessity of DevOps when cultivating an automotive-friendly culture. It’s through this collaborative discipline that automation shines, ultimately enabling a more agile approach to release management.
Automation of both front-and-back office processes is critical here, as not only does it enable a flow of clean, real-time data to facilitate front-office experiences, but, when combined with DevOps, back-office deployment and infrastructure provisioning becomes agile, collaborative, and best of all, continuous.
We call this the automation advantage.