Topic :

Posted: 20 Nov 2017


By Mohit Sharma

The key objective of establishing a well-defined Target Operating Model (TOM) for RPA is to create an opportunity for client organizations to maximize business value by harnessing the virtual workforce and other organizational resources to the best effect while maintaining control over future costs and with stronger risk mitigation strategies.

Client organizations and service providers would be well served by establishing a well-structured TOM before transitioning from the robot build and design phase to Business-As-Usual (BAU) / steady state. This is important as the operations team should be aware of the prerequisites of robotic process automation, i.e., what needs to be completed in advance, well before processes are automated and transitioned from human operators to robot applications. This is possible when a stable IT environment exists and there are no issues with hardware or software systems either operating on-premise or in a cloud-based environment.

Some key areas that clients should concentrate on while establishing a robotic operating model from the current one are:

Understanding the Components of a Robotic Process Automation Operating Model

For organizations to use robotic process automation efficiently, the RPA Target Operating Model is a vital guideline. Consider these important factors when developing an RPA OM: 

  • Will a decentralized or centralized team create and carry out services? Is the RPA group working closely with the business or IT?
  • What functions do roles like "Business Analyst," "RPA Designer," and "RPA Controller" have in the RPA organization? 
  • What are the necessary quality gates and escalation paths? 
  • How does your RPA automation solution integrate with the IT environment you already have? 
  • A standardized demand process supports structuring the pipeline - how should this look?  
  • What processes earn the highest benefits with reasonable effort for development and maintenance? 
  • When should the concepts of change communication and personnel qualification be specified?

Why Is The RPA Target Operating Model Important For Sustainable Success?

Managing a small Shared Service Centre (SSC) is similar to setting up and managing a successful RPA automation operation. Ensure clear and defined roles, structures, and processes to enable the management to oversee and direct their RPA CoE. KPIs must be established and included in developing guidelines, tracking robot execution data, and reporting in an organized manner to fully comprehend the costs and benefits of implementing robotic process automation. Organizations can confidently choose their operational strategies if they're equipped with this information about cost-benefit drivers.

Unforeseen Risks of Implementing RPA Without a Well-Defined Operating Model

Without an established automation operating model, the chances of achieving long-term robotic process automation success are drastically reduced. Applications created with only the initial build in mind may see success initially. But when it comes time for upkeep and maintenance, issues can arise due to differences in programming standards from one developer to the next. This can lead to decreased robot utilization and difficulty patching up any faulty code or omissions that have been made. To avoid such risks, creating a noteworthy automation operating model is essential for reliable results.


Focus Areas
Target Operating Model (TOM) – Points to consider
Refining ownership structures
  • Who will own the software – is this owned by and licensed from the RPA software provider or the service provider?
  • Who will maintain the RPA tool on an ongoing basis?
  • What obligations lie with the software provider vs. the service provider vs. the client organization to ensure the robots perform as required and with reliability?
  • Key considerations to review may include:
    • Licensing directly with the software provider might mitigate risks arising in case the software provider is acquired by competitor, which has high probability while this new space is still developing
    • Avoiding in-house tools from a service provider might minimize risk of lock-in to a service provider
Change Management
  • Establishing a communications roadmap between robot operational teams and business / process owners (client) to prevent any misalignment between changes in service demands, operating procedures etc.
  • Establish change management procedures to closely monitor and escalate issues to respective owners accountable for issue resolution
  • Define clear guidelines for situations where robots raise red flags in exceptional areas – Establish a reporting and escalation resolution matrix clearly identifying who is responsible or accountable for what activities
  • Periodic reporting of progress and issue areas to senior management – Establish real-time accessible dashboards providing a 360 degree view of robot KPIs and benefits realized
Performance Management
  • Establishing revised SLA parameters in-terms of faster transaction processing speeds and accuracy levels
  • Measuring, managing and reporting the performance levels to key stakeholders (operational leads of client and RPA implementation partner)
  • Taking course corrective actions in exceptional cases requiring human intervention (involving process experts, software architects and application developers) whenever required – standby team to prevent any impact on business operations
  • Continuously identify opportunities for improving robot operational performance
Defining roles and responsibilities
in a virtual workforce environment
  • Focus on clearly establishing well defined roles and responsibilities in the following areas:
    • Nominate key resources accountable for managing robot performance, uptime and compliance adherence
    • Responsibility and accountability of dedicated resources on re-programming robots as a result of change in business rules
    • Identifying key operational teams (implementation partner) responsible for coordinating together to deliver the required results to business
    • Defining roles and responsibilities of business (e.g. query resolution, managing exceptions etc.) – Nomination of single point of contact (SPOC) from business to take appropriate action within set time frames
  • Clearly defining and communicating accountabilities among key parties involved in the RPA implementation phase (RPA software vendor, implementation partner and client organization)
    Key areas may include:
    • Keeping software patches updated on a real-time basis
    • Implementation partner’s responsibility to maintain uptime, service levels, accuracy, reporting, issue resolution and regulatory compliance in close coordination with RPA software vendor
    • Clearly documenting expectations, roles and responsibilities including achieving revised service levels from the implementation parties in the contract agreement
Robot workforce management
  • RPA will not ensure 100% automation and elimination of all human operators/ managers
  • Dedicated human resource ‘Robot Manager’ may be assigned responsibilities for managing and monitoring robot performance, issues, robotic resource allocation activities, exception handling and speed and accuracy levels
  • Creating a robot trainer team may include a team of highly trained software developers and process experts to define development requirements, including testing and deploying robots in live environment
Governance Having appropriate levels of RPA governance are in place is an essential element of ensuring the RPA tools deliver on expected business outcomes. Key considerations include:
  • Should governance be just within the client organization or span across the service provider as well?
  • Who takes the responsibility if a robot malfunctions? (e.g. if payment missed, who pays the penalty – Is it the implementation partner or the RPA software provider)
  • Who is responsible for establishing robot change control procedures? Does it lie with the client organization (as part of their change control policies) or should they be refined in close collaboration with the implementation partner?
Reverse Transition Plan Buyers should develop Reverse Transition Plan to have flexibility to move or swap with another RPA tool or service provider



Types of Process
Due Diligence Steps
Ownership and Pricing Strategy
Already outsourced
  1. Benchmark Incumbent service provider’s RPA tools and capabilities to the tools available in the market.
  2. Assess Business case of moving to other service provider if incumbent service provider RPA solution fails to meet requirements.
  3. Assess if they can acquire and develop in-house capabilities for reverse transition in medium to long term depending on the other non financial drivers (for automated component of process) and contractual obligations
  • Buy side client organization should own the tool after evaluating the different pricing options for the automated component of the process.
  • If the Incumbent service provider is selected- the pricing of human interface should be negotiated depending on onshore/offshore location.
  • Gain sharing: it should be define objectively depending on the quality of data available to ascertain the gains of a RPA initiative. It is generally subjective to estimate the exact efficiency gain in short to medium term.
Not yet outsourced
  1. Evaluate service providers along with RPA tools (in-house and third-party tools) depending on the process which has been considered.
  2. Develop in-house capabilities with training from RPA tool provider and its channel partners.
  • Buy side client organization should own the tool after evaluating the different pricing options for the automated component of the process.
  • If any service provider is selected – the pricing of human interface should be negotiated depending on onshore/offshore location.
  • Gain sharing: it should be defined objectively depending on the quality of data available to ascertain the gains of a RPA initiative.


Key Points for consideration for Service provider

  • Ability to package a solution with value added services would be key factor.
  • Need to move up the value chain beyond being reseller of RPA tools.
  • Pricing of in-house tools should be competitive.
  • M&A strategy to acquire RPA tool inorganically.
  • Proactive to offer RPA solutions to existing clients and cannibalize the current revenue to grow for tomorrow otherwise client might be lost to competitors with strong RPA offerings.

Key Points for consideration for buy side organisations

  • The ownership of niche RPA tool is critical as they are attractive acquisition targets by competing service provider.
  • Reverse Transition strategies should be planned and tested on regular basis. This will provide flexibility to swap between different and better RPA tools (if need arises).
  • Pricing contracts should be of terms no more than 12 to 18 months.
  • Train and develop in-house capabilities (onshore/offshore) in RPA tools domain.
  • Continuously evaluate existing and emerging RPA tools in the market.


New Call-to-action

Mohit Sharma

Mohit Sharma

Founder and Exec Chairman
Thought Leader | Trusted Advisor | Innovator