Increase in productivity and decrease in the workload for the human workforce are among the benefits that SMFG and SMBC report as a result of the implementation of robotic process automation.
The adoption of novel technology solutions by Japanese financial services companies has been typically associated with human job losses. Thus, when earlier this year Fukoku Mutual Life Insurance said it would deploy IBM’s Watson Explorer artificial intelligence system, it also said 34 of its employees would be made redundant.
However, another Japanese financial services giant – Sumitomo Mitsui Financial Group, Inc. (TYO:8316), has offered a different perspective on the deployment of novel tech solutions. Sumitomo Mitsui Financial Group and Sumitomo Mitsui Banking Corporation have earlier this week published an update on the progress of implementation of robotic process automation (RPA) and how it helps the companies achieve their performance goals.
Under the medium-term management plan starting this fiscal year, SMFG has been working toward the achievement of higher productivity and operational efficiency through the utilization of new technologies and sharing of infrastructure on a group wide basis. Costs are expected to be reduced by JPY 50 billion by the end of FY2020. Robotic process automation (RPA) is an important initiative to achieve these objectives. In its essence, RPA is a technology that automates routine, repetitive and rule-based manual activities.
RPA is used for operations such as:
- Compliance and risk operations with expected increases in volume due to future regulations (for example, notifications of suspicious transactions);
- Industry data gathering outside normal working hours;
- Preparations of performance reports for customers;
- Routine operation center processes (related to deposits, loans, currency exchange, etc).
The banks have first evaluated all processes within the headquarter department. Then unnecessary processes were eliminated and duplicative operations were integrated. Of the remaining tasks, certain ones were transformed to be suitable for RPA. Finally, the identified tasks were automated with the use of RPA.
So far, according to the banks, operational volume reductions of approximately 200 operations or 400,000 hours annually have been realized. About 1 million hours of capacity is expected to be generated by the end of this fiscal year, and more than 3 million hours for the next three years (the workload of 1,500 people).
Going forward, organizational restructuring will be used to generate further capacity through integration and enhancement of operations. The extra capacity to be generated over the next 3 years will be used for a work-style reform, such as allowing reasonable working hours to employees. This way, new technology is actually working for rather against human employees.