Lean AI: Powering Intelligent Automation – The third wave of operational efficiency?
Automation is an old word.
Like a shapeshifter in mythical stories, it has changed multiple forms and shapes over the decades, but still remains critical in driving business efficiency gains.
We look at three waves of this change.
Over twenty years back, in the first wave, automation was part of the entire Six Sigma and Lean Six Sigma approach to processes. One looked at analyzing steps of a process, identifying unnecessary waste and then making the entire process more efficient and lean. Cost out and waste reduction were the key motto.
Over time, as technology started entering every business process, the second wave of automation came with technology implementation. Entire series of manual process steps could be eliminated or coded to work much faster, in a much more seamless way. Automation through technology had the same outcomes as the first wave though. Cost out and waste reduction.
Cut to today. Business processes are still the constant today. So is technology. But what is changing today, is the nature and shape of data powering these systems and processes. And that is driving, in our view, the third wave of automation. However the focus on this automation is on operational effectiveness and not just efficiency.
Intelligent automation is the key to this third wave. It can not just drive cost-out and waste reduction, but also create signals for the future and trigger intelligent actions. AI is the secret power in this. When one thinks of AI, one imagines- automated vehicles, edge devices, robotic processors and the like. But AI can play a significant role as well in internal process automation. Such examples of intelligent automation is today visible across business functions. To call out a few examples of AI powered intelligent automation –
- Predictive maintenance of assets for zero downtime of operations,
- Automated or assisted review, inspection and audit processes to increase compliance and reduce cycle time,
- An integrated business planning and dynamic allocation of budgets and resources, or
- A more automated support, claims, underwriting, collections or pricing processes focused on increasing customer experience at every moment of truth.
That is how we define the third wave: Lean AI driving intelligent automation. Used to improve operational efficiency and effectiveness in existing business processes, eliminating waste, reducing cost and building better predictive signals and actions.
The Lean AI wave can be imagined as a 4 step process:
- AI use case discovery: Identify the current processes amenable to data and AI driven improvement, design the solution roadmap and proactively think through the potential failure modes of enterprise adoption.
- Data transformation: Use feature engineering through Computer Vision, Natural Language Processing, Graph Networks and other deep learning techniques to abstract and summarize information from a variety of sources ranging from image to text, voice, video, sensor and the like. A variety of signals in the new digital world can be transformed into data to derive insights and learnings on how to improve process performance.
- This then leads to process re-imagination, with AI embedded business solutions that can help alert, personalize, plan, optimize and interact with users better than ever before. The new AI powered processes are far more automated to assist humans in taking better decisions or do things which could not be done earlier. These processes can be developed using Machine Learning algorithms and many of them are re-usable components ready to be used in newer applications, instead of starting from scratch every time.
- Finally, the institutionalization happens when the new solution integrates very well with other existing technology applications and scale to the business need. Such optimization of AI applications happen either on cloud or through edge device, through workflows or through custom UI/UX which can bring the solution architecture seamlessly to embed analytics in reimagined user facing processes and system.
Why is this urgent: Post COVID-19, even as businesses reassess their priorities and their investments, operational effectiveness is a key short-term goal for many businesses. This is relevant in many different types of business operations including customer facing operations, manufacturing, supply chain, audit or inspection, contact centers, sales etc.
Many do not yet associate AI with such savings. But Lean AI with its intelligent automation approach, can be a partner for that imminent change.