What is RPA and how does it work? A guide to automation

In any organization, even the most modern, there is a hidden and extremely costly problem: the waste of human potential. Skilled, creative and experienced employees – financiers, HR specialists, customer service experts – spend much of their day performing tasks that are tedious, repetitive and require none of their unique competencies. We’re talking about manually copying data between incompatible systems, transcribing information from invoices into spreadsheets, generating the same cyclical reports or manually updating data in CRM systems.

These tasks are not just a “cost of doing business.” They’re a powerful, invisible brake on growth, a source of costly operational errors and a simple path to burnout for top team members. Fortunately, there is a mature and proven technology designed specifically to solve this problem. It is Robotic Process Automation (RPA), or Robotized Process Automation. It’s a concept that allows a company to deploy “digital workers” – software robots that can take over those most repetitive and time-consuming tasks, freeing up people for work in which they are truly indispensable.

This guide is a comprehensive introduction to the world of RPA, prepared with leaders and managers in mind. Step by step, we will answer eleven key questions that will help you understand what the technology is, the potential it holds, the benefits it can bring to your company and, critically, how to approach its implementation in a strategic, cost-effective and secure way.

What is Robotic Process Automation (RPA) and how to distinguish it from artificial intelligence?

To understand the potential of RPA, it is crucial to define precisely what this technology is and is not. In the simplest terms, Robotic Process Automation is a technology that allows you to configure special software – called a “robot” or “bot” – to mimic and automate the actions that a human performs on your computer by interacting with the graphical interface (GUI) of various business applications.

The key phrase here is “mimicking human actions at the interface level.” The RPA robot does not integrate with other systems at a deep, technical level of code or databases (although it may do so if it is part of the process). It works exactly like an employee: it uses a mouse and keyboard to log into the application with its login and password, click on buttons, open menus, fill out forms, copy data from one window and paste it into another. It’s a technology designed to automate existing, manual processes without requiring costly and time-consuming redesign of the underlying IT systems.

It is also extremely important to distinguish RPA from the much broader and often confused concept of artificial intelligence (AI). The difference is fundamental:

RPA is a “doing” (doing) technology. The RPA robot is excellent at performing clearly defined, rule-based and repetitive tasks. It operates according to a precisely designed scenario (script). If an unusual situation arises in the process that the script does not anticipate, the robot will stop and ask for human intervention. It does not learn or make independent, judgmental decisions. Its strength is precision, speed and 100 percent repeatability.
AI is “thinking” and “learning” (thinking & learning) technology. AI systems, such as machine learning or natural language processing, are designed to analyze data, recognize patterns, make decisions under uncertainty and work with unstructured data (such as the contents of an email, an image of an invoice or a recording of a conversation).

This can be illustrated by a simple analogy. The RPA robot is like an extremely diligent and fast worker on an assembly line who performs the same predefined action, such as tightening a screw, thousands of times with absolute precision and without fatigue. The AI system, on the other hand, is like an experienced quality engineer who analyzes a camera image and decides based on subtle differences in the appearance of a product whether it meets quality standards. As we will see later, the two technologies complement each other perfectly, but they solve completely different classes of problems.

Why are repetitive, manual tasks limiting your business growth and generating hidden costs?

Many companies underestimate the real, total cost they incur from maintaining repetitive, manual processes. These costs go far beyond the salary of the employee performing the task. They are hidden, systemic brakes that continually limit the potential, innovation and profitability of the entire organization.

The first and most important is opportunity cost. This is the most egregious, though most difficult to calculate, cost. Every hour your skilled financial analyst spends manually copying data from your banking system into a spreadsheet is an hour he or she has not spent strategically analyzing your investment portfolio, searching for savings or building more sophisticated forecasting models. You hire experts to use their unique knowledge and experience to solve complex problems, not to act as human APIs. Wasting their potential on low-value-added tasks is the biggest hidden cost and a brake on growth.

The second, very tangible cost, is the cost of human error. Humans, unlike machines, are fallible. They get tired, distracted, and the more tedious and repetitive the task, the more likely they are to make a mistake – a typo in an account number, copying the wrong value, omitting one line from a report. Each such error can generate real financial losses, the need for time-consuming corrective processes and customer frustration.

A third cost, often overlooked in analyses, is the impact on employee morale and retention. Doing work for eight hours a day that does not bring satisfaction or develop competence is a simple path to job burnout and frustration. This leads to lower engagement and, consequently, to increased turnover in the team, which in turn generates huge costs in recruiting, implementing and training new employees.

Finally, manual processes fundamentally limit the scalability of the business. If your business grows and the number of orders or invoices to be processed doubles, in a manual model you need to double the number of people performing these tasks to maintain the same level of service. This linear relationship between business scale and personnel costs is a serious barrier to dynamic, profitable growth.

What processes in finance, HR and customer service are ideal candidates for automation?

The potential of RPA can be unlocked in almost any department of a company. The key is to identify those processes that have the characteristics of an ideal candidate for automation. Such a process does not have to be complicated – on the contrary, the simpler and more stable, the better.

The ideal candidate for automation with RPA has the following characteristics:

It is based on clear, fixed rules: The process can be described by a logical “if X, then do Y” scheme. It does not require subjective, judgmental decision-making.
It is highly repetitive and high-volume: The task is performed multiple times per day, week or month, so automating it will result in significant time savings.
It relies on structured digital data: The robot is best able to deal with data in digital form, such as Excel files, data in information systems, or information in tables on websites.
It’s prone to human error: Automating processes where mistakes are common has the added benefit of improving quality and accuracy.
It’s stable and rarely changes: Since the robot mimics interaction with the user interface, frequent changes in the appearance of the application may require modifications to its script. Therefore, in the beginning, it is best to automate processes based on stable, mature systems.

Here are some classic examples from different areas of business:

Finance and accounting This is a department where the potential for automation is huge. Ideal candidates are processes such as processing purchase invoices (a robot can automatically monitor a dedicated email inbox, download PDF attachments with invoices, read data from them and enter them into the ERP system), reconciling bank statements or automatically generating cyclical management reports.
Human Resources (HR) Here RPA is perfect for the onboarding and offboarding processes of employees. The robot can automatically perform a series of standard onboarding tasks for a new employee – set up an Active Directory account, grant access to standard applications, send a package of welcome documents. Likewise, if an employee leaves, it can automatically block all his or her accesses, ensuring security.
Customer service and logistics In this area, robots can deal with processing and entering orders into the system, updating customer data in multiple systems simultaneously (e.g., when a change of address is reported), or cyclically monitoring the status of shipments on courier company websites and proactively informing customers of progress.

How do software robots work in practice and what tasks can they take over from employees?

An RPA robot is 100% software that is installed on a server or virtual station. Such a robot is given its own digital identity – a user account on the system, a login and password, and often its own email inbox. From the perspective of the information systems with which it is supposed to interact, the robot is simply another “employee” performing its tasks. The robot’s operation involves the precise, step-by-step reproduction of a sequence of actions that was previously designed and “taught” to it by a human (RPA developer). The robot, like a human, “sees” applications and their interfaces on the screen. It can perform a wide range of tasks that mimic human computer work, such as:

Logging in and out of the application.
Opening e-mails and attachments.
Copying data from one place and pasting it into another.
Filling out forms on websites and applications.
Clicking on buttons and selecting options from menus.
Working with spreadsheets – reading, writing and processing data.
Retrieving data from websites (web scraping).
Performing simple, rule-based calculations.

How does RPA increase productivity, reduce errors and increase team satisfaction?

Implementing RPA brings three key measurable benefits to an organization. The first and most obvious is a dramatic increase in productivity. Software robots can work 24 hours a day, 7 days a week, with no breaks, vacations or sick leave. They perform their assigned tasks many times faster than a human, allowing them to process a much higher volume of transactions without the need to increase staffing.

The second extremely important benefit is the improvement of quality and reduction of errors. The robot, acting according to a precise scenario, does not make mistakes due to fatigue, distraction or simple mistake. It performs each task with 100% accuracy, which eliminates the costs associated with correcting errors and improves the quality of data in the company’s systems.

A third benefit, often underestimated, is the positive impact on team satisfaction and engagement. Automation frees employees from the most tedious, repetitive and frustrating tasks. Instead of spending hours on “copy-paste” work, they can devote their time and energy to tasks that require human competence – solving complex problems, interacting with customers, thinking creatively or improving processes. This leads to an increase in their job satisfaction, higher engagement and lower turnover.

How do you ensure data and systems security when deploying RPA robots?

The deployment of “digital workers” introduces new and unique cyber security challenges to organizations. A robot that accesses multiple systems and processes potentially sensitive data must be treated with the same, if not more, attention than a human employee.

A key issue is the management of the bot’s digital identity. Each bot must have its own unique account in the system (e.g., in Active Directory), which is not shared. The privileges of this account must be assigned according to the principle of least privilege. This means that the robot should have access only to those applications, systems and data that are absolutely necessary to perform its specific task.

It is also extremely important to manage credentials securely. A robot needs to use passwords to log into various systems. Storing these passwords in plain text in a robot script is an unacceptable mistake. They must be stored in a secure, encrypted “credential vault” from which the robot retrieves them dynamically at startup.

Every action of the robot must also be logged and auditable in detail. Mechanisms must be implemented to accurately track what operations, in what systems and at what time the robot performed. This is necessary both for security purposes (analysis of possible incidents) and for auditing purposes.

Where to start when analyzing business processes for the viability of automation?

The process of selecting the first automation candidates is crucial to the success of the company’s entire RPA initiative. It is a good practice to start with a pilot project that will be simple, provide quick and measurable benefits (“quick win”) and allow the company to gain experience and build support for further efforts.

The analysis should begin with workshops with business teams. It is the employees who perform the tasks in question on a daily basis who know best which are the most time-consuming, repetitive and frustrating. A long list of potential processes to automate should be created.

Then, for each of these processes, gather specific metrics: How many times a day or month is it performed? How much time on average does it take to execute manually? What is the estimated error rate? This data will allow a preliminary calculation of potential savings. A process that is performed 500 times a day and takes 5 minutes is a much better candidate than a process performed once a month that takes an hour.

What is the process of designing, implementing and maintaining digital workers (robots)?

Implementing an RPA robot is a structured project that consists of several phases. Once a process is selected for automation, there is a design phase in which the business analyst, together with the RPA developer, map each step of the process in detail “as is” (as-is) and design the target automated process “as will be” (to-be). Then, the RPA developer, using a special platform, creates a robot script that reflects this logic.

The next extremely important step is testing. The robot must be thoroughly tested in a separate, isolated test environment to make sure that it works properly and can handle all foreseen scenarios and exceptions. Only after successful testing, is the robot deployed into the production environment.

However, it is important to remember that the work does not end at this point. Robots, like employees, require maintenance and monitoring. If the GUI of any of the automated applications changes, the robot script will have to be updated. Therefore, any RPA initiative must include a plan from the outset for maintaining and further developing the “digital workforce.”

What is the difference between simple automation and intelligent automation using AI?

RPA’s basic robots can handle structured data and processes based on rigid rules very well. However, they are limited by their inability to work with unstructured data (such as the contents of an email or an invoice image) and make decisions under uncertainty.

This is where the concept of Intelligent Automation, also known as hyper-automation, comes in, combining the power of RPA with the capabilities of artificial intelligence. In this model, tasks are shared:

An AI system (e.g., based on NLP or OCR) takes the first step – it processes unstructured data and transforms it into a structured form. For example, it reads the contents of an invoice from a PDF file and extracts the supplier’s name, invoice number, date and amount.
Then, this structured data is passed to the RPA robot, which performs the further, transactional part of the process – logging into the ERP system and entering the read data into it.

The combination of AI and RPA allows automation of a much broader and more complex class of business processes, opening up entirely new opportunities for efficiency.

What mistakes should be avoided for a successful RPA implementation project?

Despite the enormous potential, many RPA implementation projects fail. This is usually due to several recurring, avoidable mistakes. The most common is trying to automate a bad, inefficient process. Automating a process that is inherently flawed only leads to getting bad results faster. Always optimize and simplify the process first, and only then automate it.

Other common pitfalls include failing to engage the business and treating RPA as a purely IT project, underestimating the change management aspect and failing to adequately communicate with employees who may fear being “replaced by robots,” and not having a long-term plan to maintain, scale and manage the entire portfolio of automated processes.

How to effectively measure return on investment (ROI) in automation projects?

In order to justify and evaluate the success of an RPA project, it is necessary to have a clear methodology for measuring ROI. ROI from automation has two main dimensions.

The first is hard cost savings. These can be calculated by estimating the number of man-hours saved by automation and multiplying it by the average cost of an employee’s man-hour. Add to that the savings from reducing errors and the cost of fixing them.

The second, and often more important dimension, is added value. It includes such benefits as increased process throughput (the robot is able to handle 3 times as many orders in the same amount of time), improved customer satisfaction (thanks to faster responses) or increased commitment and innovation of employees who have been relieved of repetitive tasks. Juxtaposing all of these benefits with the total cost of implementing and maintaining the robot makes it possible to accurately demonstrate the real value that automation has brought to the company.

Robotic process automation is a powerful tool for increasing efficiency, but like any new element in the IT ecosystem, it introduces new security and management challenges. At nFlo, we believe that a successful digital transformation must be based on a solid and secure foundation.

Deploying a digital workforce requires not only optimizing processes, but also ensuring the security of their identities, permissions and activities. Before you begin your journey with automation, it’s critical to have a stable and secure infrastructure that can support these new workloads. Contact the experts at nFlo to discuss how we can help you design and secure an IT infrastructure that becomes a solid foundation for your automation initiatives and allows you to reap maximum benefits without unnecessary risk.