Robotic Process Automation (RPA) is the use of software robots to automate repetitive, rules-based processes that are typically executed by humans using one or more existing software applications. RPA, the fastest growing enterprise software segment, has gained traction due to its ability to save customers money and increase operational resiliency during the pandemic.
For enterprises, implementing RPA is a clear win. However, from the employee perspective, the value of RPA is less certain. Unlike other software that creates value by helping organizations grow, RPA has the potential to cause significant technological unemployment.
UiPath and other leading vendors claim that RPA frees up employee time to focus on higher-value tasks. However, this perspective is not consistent with the primary business case for RPA – cost-savings.
At $500 million of annual recurring revenue, UiPath's robots are already doing the work of an estimated 100,000 employees. This does not mean that UiPath has led to the unemployment of 100,000 people – companies still need humans to oversee the execution of processes, and do repurpose employees to create value in other ways. At the same time, it is certain that RPA and UiPath will be a significant driver of technological unemployment.
- UiPath's robots already do the work of 100,000 full-time employees.
- UiPath customers replace the work of one human employee for every $5,000 spent on RPA robots.
- RPA robots could do the work of 4 million employees by 2030.
- Jobs that involve static rules-based processes, require minimal human input, and are repetitive in nature are most susceptible to RPA disruption.
Table of Contents
- UiPath Robots Already Do the Work of 100,000 Full-time Employees
- At $20 Billion, RPA Robots Could Do the Work of 4 Million Employees by 2030
- Which Jobs Are Most Likely To Be Disrupted?
UiPath Robots Already Do the Work of 100,000 Full-time Employees
According to Bloomberg, UiPath currently has $500 million in annual recurring revenue. UiPath has shared that the annual cost of a robot is 2 to 15 times lower than that of a full-time employee. At an average cost of $50,000 per employee, this means that UiPath's robots are currently doing the work of 20,000 to 150,000 full-time employees.
Put differently, UiPath customers replace the work of one human employee for every $5,000 spent on RPA robots. UiPath has approximately 7,000 customers today. This means that its average customer spends roughly $70,000 per year to automate the work of 14 full-time employees.
This estimate is consistent with case studies that have been published on the impact of RPA at large enterprises:
- Nielsen saved 400,000 hours of labor within three years of adopting RPA (source)
- Siemens' first 170 RPA bots completed 280,000 of human equivalent work (source)
- KeyBank completed nine years of work in just two weeks (source)
- Expo Group reduced handling time for a major logistics process by 87% (source)
At $20 Billion, RPA Robots Could Do the Work of 4 Million Employees by 2030
Robotic process automation is a new market. Therefore, it's difficult to know exactly how large it will become. Multiple analysts believe that the RPA market could grow to well over $20 billion by 2030. Reports from Grand View Research and Allied Market Research indicate that the RPA market could hit $20 billion as early as 2027.
If it costs $5,000 to replace the work of a single employee, this means that RPA robots could do the work of 4 million employees by 2030. We can actually expect the cost of replacing an employee's work to decline as the robots become more intelligent, and competition causes RPA vendors to reduce their prices.
As mentioned above, this does not mean that RPA will immediately force four million individuals into unemployment. In most cases, RPA robots are only able to automate a portion of an employee's tasks. Until the robots can automate entire processes, these individuals are likely to remain employed to work alongside the robots.
In the short-term, it's more likely that RPA customers will reduce headcount by hiring less new employees. However, significant advancements in artificial intelligence and machine learning mean that an increasing amount of processes will become fully automatable over the next decade. RPA vendors and experts refer to this unification of RPA, AI, machine learning, and process mining as hyperautomation, or the fully automated enterprise.
Which Jobs Are Most Likely To Be Disrupted?
RPA will impact all industries. In fact, 80% of the Fortune 10 companies are already UiPath customers. However, there are certain types of jobs that are more susceptible to RPA disruption.
According to a white paper from the Federal Government's Chief Information Officer Council, jobs that possess some or all of the following characteristics are likely RPA targets:
- Static rules-based processes, requiring minimal human input or decision making;
- Repetitive in nature;
- Can be performed during off-peak hours;
- Are data driven and involve data manipulation; and
- Have high error rates.
The Council identified specific business functions and processes that fit these criteria and are most likely to be disrupted by RPA. To understand the depth of disruption these functions are likely to face, consider that Gartner research recently found that the average amount of avoidable rework in accounting departments can take up to 30% of a full-time employee’s overall time. This equates to savings of 25,000 hours per year for an organization with 40 full-time accounting staff.
|Acquisition & Procurement||RPA bots can automate much of the repetitive acquisition and procurement processes and activities such as managing procurement requests; quote, invoice, and contract management; work order management; returns processing; and vendor analysis.|
|Customer Service||RPA bots can automate much of traditional customer services processes and activities such as contact and call center processes; automated updates to customer profiles; billing and order processing; automated notifications; and integrated data processing across multiple intake channels.|
|Finance and Accounting||RPA bots can automate finance and accounting processes such as reconciliations and appeals processes; claims and chargeback processing; expense payments; returns management; grants management and funds distributions; reporting and financial auditing; and inventory processing.|
|Human Resources||HR functions that can be automated with RPA bots include payroll processing, benefits management, education and training, recruitment, and onboarding tools. These bots allow employees to access enterprise-wide self-service HR features and save time, provide greater consistency of experience, and improve transparency and workflow.|
|IT Management||RPA bots can automate IT processes such as application, infrastructure, and network monitoring; folder, file, and records management; user and directory management; automated forms development; email processing and distribution; and security and compliance processing.|