In her third piece, Cocoa Gao looks at the application of AI in the back office and how it can be used to create new value by improving insight generation, and reduce costs through process automation.
Stay tuned for her next articles as well which will cover the new operating model and the new competitive landscape.
AI has been rapidly applied by businesses in different industries to increase efficiencies and create new value. Its impact on some industries, such as manufacturing and retail, is revolutionary and disruptive. For management consulting firms, the effects of adopting AI solutions are generally positive.
There are two types of AI projects – new value creation by improving insight generation, and cost reduction through process automation. In the previous section, we discussed some of the ways that AI can be employed in the project delivery process to create new value for consulting firms. In this section, we will explore the opportunities for AI to be applied in internal logistics which can help save time, reduce costs, and increase productivity and accuracy. Many consulting firms process a huge volume of paperwork manually – creating and billing client invoices, recording billable/non-billable hours, and drafting process reports; these tasks can slow down a business significantly. According to research, small businesses in the UK spend 120 working days on average, on administrative tasks in a year and around 5.6% of total staff time on back office tasks. Many of the administrative tasks are routine, detail-oriented, and repetitive; cognitive automation solutions will be much more efficient and accurate in handling these tasks. Cognitive automation refers to using a combination of AI and Robotic Process Automation (RPA) to intellectualize the business processes.
RPA is the least expensive and one of the easiest cognitive technologies to be implemented. RPA can be integrated into existing IT applications and executes rule-based workstreams based on well-structured inputs. For example, in the current back office process, users not only have to work on interpretation and decision making, they also have to collect, copy, and validate the data files. By employing RPA, users can focus on complex tasks while bots take care of the repetitive data tasks. RPA allows consultancies to cut costs by reducing the number of manual processes, human effort per process, and error rate.
Engaging Natural Language Processing (NLP)
AI solutions like NLP can also be applied to process client invoices. NLP gives machines the ability to read, understand, and derive meaning from human languages like speech and text. NLP can extract critical information such as account data, billing amounts, parties involved, and addresses from numerous unstructured forms. Once the data are extracted and organized by NLP, an RPA bot can input them into IT applications to execute further rule-based workstreams.
NLP can also be implemented to support user requests. When consultants navigate through internal knowledge database for information, NLP will allow consultants to search for similar cases quickly. For large consultancies, NLP can also be applied to intranet sites to answer employee questions on topics including IT and HR policy. NLP can enable consultancies to handle growing number of employees without hiring additional staff.
Adopting Business Intelligence Tools
Consultants can use various off-the-shelf business intelligence tools to boost their productivity. These tools can help to automate some short and simple tasks. If This Then That (IFTTT) is a software platform that connects apps, devices, and services from different developers and triggers one or more automations. For example, a new meeting invite added on a calendar will trigger a new note template to be created in the notebook app, titled as the correspondent meeting name. Expense tracking can also be tedious; consultants can sync email accounts with Google Spreadsheet. Whenever a receipt comes through email, IFTTT will automatically add a row to the Google Spreadsheet, noting the expense detail along with a link to the email receipt.
Bury, Rhiannon. “UK small businesses wasting 120 days each year on admin.” The Telegraph, September 11, 2017. [https://www.telegraph.co.uk/business/2017/09/11/uk-small-businesses-wasting-120-days-year-admin/].
Consultancy UK, “Three benefits of AI and automation for consulting businesses.”, September 25, 2018. [https://www.consultancy.uk/news/18753/three-benefits-of-ai-and-automation-for-consulting-businesses].
Davenport, T., and Ronanki R. “Artificial Intelligence for the Real World.”, Harvard Business Review, January – February 2018 Issue. [https://hbr.org/2018/01/artificial-intelligence-for-the-real-world].
Gesing, B., Peterson, S.J., and Mchelsen, D. “Artificial Intelligence in Logistics.” DHL Customer Solutions &Innovation (2018). [http://www.globalhha.com/doclib/data/upload/doc_con/5e50c53c5bf67.pdf].
Martin, J., and Finnegan, M. “What is IFTTT? How to use If This, Then That services.” Computerworld, January 31, 2019. [https://www.computerworld.com/article/3239304/what-is-ifttt-how-to-use-if-this-then-that-services.html].