The COVID-19 pandemic has had a significant impact on the global economy, affecting industries and organizations of all sizes. While forcing organizations to adapt to a new normal, this pandemic has also provided a glimpse into the global workforce's future. In order to adapt to this new workforce, organizations have begun accelerating their digital transformation and adopting an in-depth approach to collecting, analyzing, and redeploying mountains of data generated by their customers, employees, and even senior management leveraging technology for this transformation. However, this use of technology is often limited to updating systems and capabilities through automation and artificial intelligence. Organizations still have internal processes that require human intervention and oversight. Understanding exactly how each process works is key, and that is where process mining comes into play. Process Mining is seeing an uptick in adoption during this period of digital transformation: driving continuous improvement of business operations through process-reengineering and integration with robotic process automation (RPA) and artificial intelligence systems.
Estimates show that companies lose 20-30 percent of revenue due to poorly structured organizational processes. To develop stronger operating models and reduce this revenue loss, these organizations need to thoroughly understand the current state of their business processes. Inspired by this reevaluation and owing to its optimization capabilities, process mining is growing increasingly popular with financial services firms looking to enhance their processes. Expectations show that the process mining market will grow from $418 million in 2020 to $3.2 billion by 2025.
Process mining has gained significant traction in the financial services industry because organizations have invested in replacing their legacy systems, upgrading architectures, and identifying automation opportunities across operations. By implementing process mining software, these firms can easily visualize the many steps involved within each process, determine the most common process paths, identify process deviations, and capture the frequency and cost (both time and dollar value) of these deviations. Given the ability of process mining techniques to break down processes to such granularity, businesses can effectively monitor performance and compare concepts with reality.
Additionally, process mining can be integrated into virtually any application, proving ideal to the financial services industry, which faces continually increasing expectations of speed and convenience from customers and significant shifts in their social and political environment. Process mining can help provide a simplified view of any external transaction or internal process from beginning to end, enabling owners to monitor process evolution.
Process mining also enables these firms to view multiple systems within their organization and processes within those systems providing a detailed and holistic view. This provides them with all the information they need to identify opportunities to refine and/or standardize their processes as required. As institutions push towards greater digitization and transformation of their business models, process mining will enable them to treat innovation not as a disruptive event but as an ongoing transformation of the business itself.
Due to the discovery, enhancement, and continuous monitoring capabilities of process mining, financial institutions are eager to implement this technology across their organizations to the extent where 65 percent of firms are currently using or are in the early stages of adoption. In one such instance, Capco leveraged Celonis’ process mining technology within a global bank to identify underperforming branch locations, where client offboarding was taking 60% longer than average, adding 20+ days to the processing time.
With process mining, Capco was able to quantify underperformance and improve performance for branch locations by over 40%, thus removing any regional bottlenecks and upstream data issues. Additionally, Capco further enabled the client to meet their efficiency targets, reduce throughput time, and ensure continuous monitoring and improvement of processes.
Similar benefits were generated at another global bank in the institutional payments space. There, Capco utilized Celonis process mining technology to define the initial process flow and deviations to generate insight into key payments metrics (with a focus on determining the volume of manual interventions along the payments journey). Additionally, Capco was able to assess the flow of data from system to system and utilized Celonis’ technology to act as a database through which payments information was centralized to more efficiently track key metrics.
In both these use cases, Capco was able to apply Celonis process mining technology to root cause process inefficiencies for our clients and develop solutions to reduce this friction. As the emphasis on collecting and leveraging the wealth of data generated by financial institutions grows, process mining technology continues to appear in large organizations as a business-critical tool in the battle for the fastest, most efficient and most transparent processes. With its sophisticated analytical and intelligent capabilities, process mining plays an indispensable and fundamental part in achieving operational excellence.
Saloni Arora is a Senior Consultant at Capco.
Christine Janku is a Pricipal Consultant at Capco.
Roman Kodesh is a Senior Consultant at Capco.
Ann Pattara is a Consultant at Capco.
Insights to inbox - Monthly newsletter
Master Data-Driven Business Execution. 8 virtual events worldwide.