ISG Provider Lens™ Intelligent Automation - Services and Solutions - Artificial Intelligence for IT Operations (AIOps) - Germany 2022

Automation is a key enabler for intelligent enterprises.

Automation is a relatively old concept, particularly in Germany, which has traditionally been focused on automation of processes. The ERP platforms from the 90s can be understood as early enterprise automation platforms. The automation of different processes, for instance stock movement, was not only reflected in efficient warehouse management but also in accurate accounting.

Even though automation was once envisioned for ERP, it could neither be embraced by all areas of a company, nor by all sectors of the economy. It was often considered too rigid, not taking the client and user into consideration, or at times not sufficiently engaging for clients. This was particularly true for the service segments such as banking, insurance, and utilities that mostly continued to operate homegrown systems.

The need to connect the systems of record, systems of engagement, and homegrown legacy systems, with the ecosystem of partners and agencies prepared the ground for a new type of automation. One of the biggest contributions of this new automation has been the use of AI and machine learning, popularized through the hyperscaler offerings; once limited to academic research centers these advanced technologies have now become integral to the world of business. In this new world of automation, systems are now less tightly coupled, using robotic process automation (RPA) or BOTs instead of APIs, which makes them more agile and flexible to enable integration and automation.

Surprisingly, in the new business automation space, Germany does not play a dominant role like in industrial automation and has opened the door for the arrival of new players. The reasons for this may be that Germany has always been more industrial-focused than service-oriented, but what is also true is that the German population is wary of digital technologies, particularly the use of AI. The strong working councils, or labor unions, often with measures against the replacement of human labor with advanced technology are making the adoption of automation difficult. The pandemic and the immediate need to switch to No-touch and operations revealed how Germany is lagging behind compared with other countries globally, and since then, the efforts toward digital transformation have increased tremendously.

However, though many automation projects have been rolled out in the last couple of years, they have not brought in the expected ROI; therefore, just a percentage of the automated software licenses have been effectively used, leading to frustration in the business environment.

To overcome this frustration, the approach to automation needs to be modified. It needs to encompass endto- end capabilities and scale up from a desktop, over department level, right up to enterprise-wide automation. This wider approach of automation has resulted in the emergence of integrated platforms, combining robotic process automation (RPA), intelligent document processing (IDP), conversational AI (ConAI), process discovery and mining (PD&M) solutions.

Several observability/monitoring tools, workflow engines, correlation/root cause detection, noise filtering, analytics applications, as well as self-healing mechanism have been integrated to facilitate the different cloud environments, which has made IT operations increasingly complex. Most automation tools offering low code and no code platforms, to democratize automation and bring it within reach of business users. Platforms should standardize these workbenches to ensure a unique user experience.

While there is a general agreement on the need for enterprise end-to-end automation, the way the said automation could be best deployed still remains under dispute. Many prominent product and platform vendors have extended their capabilities so they can serve as a one stop shop for a range of advanced offerings such as RPA, ConAI, IDP, and PD&M. Several service providers, and many GSI - Global System Integrators among them, are combining their IPs and platforms from their partner ecosystems together with assets from their service experiences, such as gold standard process maps, pre-trained bots, algorithms and industry knowledge. Hyperscalers are bringing in their Platform-as-a-Service (PaaS) offerings and benefits from underlying cloud/ infrastructure components, data lakes, analytics capabilities, and cloud-native deployment options.

Le Roi est mort vive le roi: The Search for the lost ROI Implementing more automation with an increasing number of intelligent components and scale is not sufficient to achieve the expected ROI and silence all criticism related to automation. There is a need to reimagine automation and what leads to a new approach, considered to be next-gen automation. This approach includes a deeper look into the processes to be automated to understand if they, with or without automation, are bringing the desired outcomes. The idea that automation is now purely focused on business outcome is not accurate because professional IT was always, with some exceptions, directed to resolving business problem.

For automation to be successful, a deeper analysis is needed; process discovery tools can add a lot of value alongside the fundamentals of the system theory and the theory of constraints (TOC) that must be understood and applied. The quest for the local optimum can easily deteriorate the throughput of the whole system. The interaction of humans, Bots, and AI needs to be reorganized and re-orchestrated. In a customer-centric world, human empathy is the decisive factor, but to stay competitive and also scale, human labor needs to be embedded and surrounded by support from Bots and intelligent machines. The often-cited justification for automation — that the human workers, once freed from daily routine work, can think about innovation, improvement, and new business models needs to be revisited. Not just disposing additional time, but talent, creativity, and questioning status quo attitudes, up to a different organization is required to drive innovation.

Concurrently, companies need to make the necessary efforts toward organizational change management (OCM) to unlock the potential of automation. Companies need to reinvent to cope with the new reality and opportunities that an increased shift to the economy of knowledge is required.

In this way, intelligent automation will deliver its promised benefits and be the new strategic enabler for successful organizations to achieve customer centricity and seamless execution — both not achievable without a high degree of automation. The same is true for the new requirements, for example, ESG compliance cannot be assured over a globally distributed ecosystem of partners and vendors without a high degree of automation.

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