Sebastian Schrötel: "Business Efficiency is a necessity"

Hi, I’m Sebastian Schrötel, currently leading Robotic Process Automation for SAP. I was in charge of several innovation journeys at SAP, the latest being the founding member of SAP’s machine learning practice and then founding RPA for SAP as a business unit.

SAP has been for many years the biggest vendor of business applications software in the world. For the last 40 years, our objective was to run businesses and processes better and more efficiently, and this is why RPA is the perfect extension to our portfolio of products. Combined with our other applications, such as machine learning, we offer a complete package for our customers to use.

RPA is a super interesting topic in the SAP world, especially considering the heterogeneous business application landscape: it isn’t just one monolithic SAP system in the middle. There are many different business applications systems, including classical office and client application tools.

We already had all the technology and knowledge in place to automate the core business applications at SAP. But at that point in time, we wanted to get knowledge on how to automate non-SAP applications.

We have the SAP Leonardo Center (NDLR: SAP’s Innovation Hub) here [in Paris] and viewed Paris as an innovation hub. And that’s why we’ve looked at the Paris ecosystem where SAP has been active for many years and finally found Contextor.

Contextor fitted perfectly with our endeavor because we were confident they could bring us the RPA knowledge to automate non-SAP applications. So this was the strategy behind this acquisition.

Very frankly, it was a timing issue.

We acquired Contextor in November last year but launched our RPA solution only in May this year at Sapphire [the SAP Annual Conference]. Gartner requires to have a live solution since the start of the year to be taken into account and since we had not finalized the integration of the Contextor solution at the time we were not eligible. That is the reason why we are not present in this year’s RPA Magic Quadrant.

We want to bring innovation into our products.

From Contextor we got non-SAP technology that we’ve combined with SAP technology. We also know that today in the market 60% of all RPA automated bots are in contact with SAP systems. Automated SAP systems enable a more stable and dedicated connection to SAP technology. This is definitely one of our strongest differentiators, and something our customers demand from us.

Also, for an even deeper integration within the ecosystem we will be announcing a convergence of the RPA and BPM world at this year’s Teched [Major Tech Exhibition by SAP].

At SAP, we have had the BPM suite for many years, and we intend to bring those worlds together. This will be another powerful differentiator.

The inclusion of RPA in the BPM world will make it possible to model new business applications, something our solid customer base will benefit from.

And reciprocally, we want RPA to use the expertise of the BPM world. This mutual deep integration is something we are putting a great emphasis on.

We have a hybrid solution between cloud and on-premise client components.

We also have a subscription model for bots that is quite interesting for our customers at the beginning of their journey, as the entry barrier is relatively low. The RPA offer is integrated in our cloud platform.

When we launched our RPA offering, we already had several thousand cloud platform customers. We provide a license that is tailored to the consumption model and has proven very attractive to our install customers base.

We leverage the existing SAP partners network which is very useful for us. With the vast experience accumulated with these partners over the years, we can holistically deliver business applications that generate value for our customers.

Last but not least, we are combining RPA with what we call conversational AI.

This was our motive behind the acquisition of Recast.ai, another Paris company. This project is supported by our machine learning practice.

There is a strong convergence between the chatbot and the conversational AI interface, and the RPA in the background acts as the executing layer to process the intent extracted from the conversation.

We thought that we needed to provide a solution that includes the core value of RPA, which is automating diverse client applications, Microsoft tools, SAP tools, web tools, and even terminal applications that still exist.

We want to bring innovation into our products. This is what our customers expect from SAP and this is how we define Intelligent RPA.

Business efficiency is a necessity.

Business efficiency is a necessity.

Our economic world is becoming more and more complex, companies have more and more pressure to stay above the competition.

With globalization, you have more and more regulations impacting the business landscape, which is directly related to the IT landscape. From an SAP perspective, this has been very interesting to watch over the last 15 years.

This also means that the need to invest in business process automation and efficiency in business processes is hard to avoid. Any business in the world that wants to be successful has to invest in business process automation to guarantee its survival.

Going forward, I think that we will see a continuation of this trend. Especially with the latest wave of AI applications, we have more and more technologies that fulfil this trend.

Before, we had many ERPs or business applications that functioned solely as databases. Business process ran by humans. You did your task, you entered a result in the system, someone else read it and stored the result again.

But what we see nowadays is a transformation.

More and more business applications are becoming actors in the execution. This is the overall trend.

The whole package, RPA, AI, and conversational AI render the business applications more active by executing a major part of the process themselves.

RPA, conversational AI and Leonardo machine learning, [is] an offering that suits any business in the world.

There are two different things.

Firstly, we want to ensure that our install-based customers are happy.

But with SAP associated with RPA, conversational AI and Leonardo machine learning, we have an offering that suits any business in the world. We are happy to onboard anyone in the world onto our SAP automation journey if we can provide value.

Focus the workforce on higher value tasks.

With business application layers becoming a more and more comparable to active processing agents, we often hear the same assumption being made. It is the assumption that with more automation, you will need less people to execute the processes. Well, not really.

There is a good example of this in Japan, where a regular day of work starts very early and people leave late in the evening. This means that during the week, children and parents hardly see each other. Japan recognized that this was a societal problem and came up with regulations and incentives for companies to limit working hours.

So what are the options for these companies to maintain the same level of production?

Well, they can either hire more employees or implement RPA. In markets like Korea and Japan, Business process automation and AI is picking up incredibly fast, and it's not about wanting to reduce the workforce, but about increasing the efficiency and finding the right balance. RPA has a societal impact.

Having the business processing layer more active means that people working in the system can avoid boring and repetitive tasks.

I’m a millennial, and the people in our generation are not lining around the street to do assembly line type work. Anyone doing the same repetitive tasks will quickly aspire to do something else and this leads to a huge turnover in shared centers where employees do monotonous, uninteresting labor.

Automation is leading a huge trend: focus the workforce on higher value tasks.

Also, there is no such thing as 100% automated tasks. Some people dream of it but it doesn’t exist yet.

You can reach a high level of automation, but you will always find exceptions, even in the most simplified processes. It is always possible that a billing address is wrong, a number was flipped in a bill, or other weird errors occurred.

You need smart people to solve these issues. For everything out of the ordinary, our business applications will have an answer in the future. But not yet.

The most successful [approach] develops a unified, long-term vision

An initial approach was to outsource work to lower wage regions. Companies were giving up responsibilities, sometimes even core business processes such as payroll, financial accounting etc. to an external service provider.

This means that companies have sometimes given us responsibility for their core processes, which can be a risk for the execution.

With Data security and data protection becoming increasingly strategic topics, people see a bigger necessity to insource business processes.

Companies are reducing their involvement with shared centers, with the logic that if they have a certain degree of internal automation, they do not have to outsource anymore. They want their highly skilled employees solving exceptions, and their robot to do the boring job.

This new holistic approach is very interesting.

We see two different methods of tackling RPA.

One way is outsourcing to a shared center that has acquired an RPA solution. This works for some, but for others it is merely a band-aid.

The companies with which I worked over the last few years that were the most successful have adopted a holistic approach:

For instance, Mitsui & Co have a digital transformation taskforce, a central crew that works with the business, IT, HR and legal units to manage this evolution holistically. They go from business area to business area, overview the entire process and help them to create efficiency.

The business is on board, the IT is on board, so they act like an internal consulting unit. This approach is the most successful because it develops a unified, long-term vision, and at SAP really enjoy working with firms that promote this philosophy.

There are many ways and methods to achieve efficiency and it is important to have many options available. Everything is a nail to you if you only have a hammer in your hand. But if you have a toolbox at your disposal, you may find better solutions to your problems.

Yes. Or a chief digital transformation officer, which we already have at SAP!

The citizen developer will be working with more and more RPA in the future.

Definitely yes.

With RPA, we are opening up the world of digital assistant, or what we call citizen developer. Without any technical skills, it is going to be hard to build an efficient RPA bot, but you do not need a master in computer science to do so.

People need the same skillset it takes to build complex macros in Excel.

We will be launching at Teched a content repository, or what we call a bot store. We will be opening it up more and more to the public and to partners.

This will enable companies to easily share bots internally. No longer will an employee be creating something locally on his machine, but bots or bot fragments will be shared, which provides great opportunities for a firm.

The citizen developer will be working with more and more RPA in the future. This is something that we anticipate and want to support.

I am a huge fan of AI and machine learning technology, with which you are able to do business processes that were previously impossible.

The processing of unstructured data, voice, and video will definitely revolutionize our daily work. We all have mobile phones, and the amount of AI that goes into those small devices is incredible.

During their last IO, Google showed us that they can compress their digital agent to just a few gigabytes and that it can run offline on your mobile phone. This is a technology that will be standardized in the years to come.

IoT and Smart sensors are also interesting, but you need AI to make good use of the analytics behind. Collecting a lot of sensor data only makes sense if you have effective analytical processing tools.

We see more and more correlation of sensor, AI and mobile applications in our core processes.

Last year, I was working in a manufacturing company with many machines and production lines. One of the most classical elements of financial accounting is depreciation. Whenever you have any kind of assets and are closing a process, you run depreciation. It is a bread and butter use case of RPA.

People already use bots for this. But now there are also sensors that meter the energy consumption of machines which has a direct influence on the life expectancy of the machine. Can we calculate depreciation based on energy consumption? Can the energy values metered be directly linked to the financial values of the asset? This combination of processes makes for an extremely interesting use case. We see more and more correlation of sensor, AI and mobile applications in our core processes.