Deloitte China, Laiye's Strategic Alliance: Mining Booming Intelligent Automation Market

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From RPA to intelligent automation

Although RPA has been a near-perfect tool for enterprises to improve efficiency, armed by AI, RPA has been given intelligence and the change brought by it has been further upgraded. Forrester finds nearly 84% of companies surveyed said a quarter of their processes need AI. And Wang believes the trend will be further strengthened.

So where is the magic of Intelligent automation? It has multiple benefits: less workload, lower costs and better compliance. Many businesses have applied this technology worldwide. According to IDC, "by 2022, 75% of tier 1 Asia/Pacific banks and insurance companies will deploy intelligent automation solutions." Telecommunications, automobiles and healthcare sectors have also witnessed a surging demand for RPA technology because these industries need to handle the requests of many retail customers while ensuring the security of their data.

Not only that, quite a few leading research institutions have joined the cohort bullish on the RPA industry. Gartner, for one, estimates the global market to reach USD 1.89 billion in 2021. Per Accenture's forecast, "in terms of automated work, RPA technology may be able to perform tasks equal to the output of 140 million full-time employees (FTEs) by 2025."

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Compared with the RPA industry in the US, China's RPA industry started growing in 2016, and its market size is therefore much smaller. iResearch estimates that the market was around USD 300 million in 2020. Deloitte's Mr. Ye expects the market to grow at 50% for at least three years. In the meantime, the fast growth has started making the sector more profitable. According to Mr. Wang, the RPA industry's gross margin is somewhat similar to other software industry segments, in which a mature company can achieve over 50%. He also thinks the industry's potential is expanding in terms of operating profits. Developing RPA requires a lot of R&D investment in technologies such as those under the 'Artificial Intelligence' (AI) umbrella. The profit margin is often compressed by tech-heavy applications.

In addition, Mr. Wang expresses there are differences in the technology routes between Chinese and American firms. For example, Chinese entrepreneurs have been unleashing AI technologies, such as Natural Language Processing (NLP), to solve judgment accuracy in processing, while only a handful of US counterparts empower RPA with AI. In terms of customers, most Chinese RPA users come from small and medium-sized enterprises, especially in the e-commerce sector. The development of large businesses is still a blue ocean.

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