UiPath’s Brandon Deer on Trends in the RPA Sector

foreign speaks we're talking about what's driving the robotic process automation Market issues and challenges in the RPA sector to discuss that I'm joined by a major industry expert with me is Brandon dear Chief strategy officer at uipath Brandon actually delighted to have you with us today it's great to be here thanks for having me James you know it seems like it's a it's a gotta be a hot time in the RPA Market because there's so much going on in terms of artificial intelligence I've never in my many years covering Enterprise I.T seen a buzzier topic than artificial intelligence is now and of course RPA rides that wave uh from where you sit as you survey the European RPA Market what a couple of key trends you see driving things this year I think that there's uh there's been a building amount of hype around AI for you know the last six or seven years I think now there's a set of Technologies and a robust set of uh Enterprise functionality to really bring it home for you know the largest of Enterprise customers and so I think we're seeing a punch behind the hype that's occurring in the market right now uh there's a few major Trends uh that uh began to Bubble Up and you know as we approach the halfway mark in 2023 here I think to level set on what those Trends mean uh for the automation Market um and our business automation platform as a whole I think you know the viewers uh probably need some context on on what you I got you guys uh yeah give us the background if you would yeah I'd love to I mean and the truth is you know the company and our products we just evolved a lot over the years Beyond kind of the the core orchestration and Studios and robots which is kind of the nomenclature that I think maybe most of your listeners are used to hearing when they uh think of a uipath right our platform today actually has many different uh layers within its suite and so we always talk about you know the three layers being a discover automate and operate uh within the Discover layer this is about continuously uncovering opportunities core processes and tasks um and improving to help you identify the highest Roi areas by which to actually go automate something so within discover you know we have process mining capabilities task mining Communications money a lot of mining but you know ways in which you can systematically um pull data out of core systems of record and think about hey based on what I'm seeing in terms of movement of data across an application or when a human actually comes into the flow what can I do to better automate that task based on the data and the spread I have across my organization uh in the second layer the actual automate layer this is about getting more done with your digital Workforce um and I always talk about it in terms of seamlessly integrating the combination of both UI automation so the user interface which is really the computer vision core of where uipath got started in understanding certain objects and elements on a screen and being able to mimic human behavior with those objects so you know Strokes on a keyboard clicks uh sorry Strokes on the idea on your keyboard clicks on the Mouse marrying that UI layer with apis which you know API integration has been around a long time but combination of UI plus API I think is a really powerful Advent in today's world uh yeah um so you know that all these things intuitively make a lot of sense it's you know uh taking the actual problem that exists within the organization getting the technology to a point where it's Enterprise ready and then married industry so you actually have a solution um and that brings me to the last piece here is you know the operating piece um which is all about Enterprise grade foundational functionality that allows you to run and optimize all of your mission critical uh businesses and your program at scale so this is you know all the Bare Bones hard to build stuff that assist admin sees or your center of excellence Excellence overseas in analytics testing uh unified management and governance flexible but uh deployment means you know it's this is the foundational stuff that you really need to run these things at scale uh with that um so that's kind of a quick rundown on you know the existing core platform that exists today sure okay that's that's the context that's the context uh now to the question um in terms of trends that you know I'm seeing in in 2023 you know I spend the vast majority of my time uh with with customers out in the field right and uh I think the things that have really come clear to me and have been validated by the executives that I spend time with uh there's a there's many I think um we're seeing a reduced budgets in in customers all over the world every industry every size of customer there is a mandate out there to reduce costs um within their companies you know we're in a high interest rate environment there's supply chain issues we we know all the headlines and labor costs start to interrupting you mean specifically mostly labor costs or or another sense of costs it's it's all fast of their business yes payrolls up but dictionary spend if you want to you know you know hold an in-person event somewhere you know flight costs are up hotel costs are up um thought costs of meals is up to if you're entertaining guests um and you're seeing it more and more in earnings announcements uh you know the actual cost of software and managing that software is uh Microsoft raising prices Salesforce announced a few weeks ago that they're raising prices across their platform so you know um literally costs costs are just up globally and it comes through and you know uh all calculations of the inflation metrics that are being reported by you know industry reporters and analysts um and you know with that uh plus High inflation and you know the cost of capital being higher I think a lot of companies are seeing potential pressure on revenue or at least not having as much visibility to the revenue that they thought they had and uh mandates are being put out there uh to by board of directors by executive teams saying hey you know we need a plan over the next three years to take out you know x hundred million dollars these are you know very large organizations so right you know it's pretty uncommon that I go into a conversation these days and you know ask a cxo so you know what are the priorities for the organization one of the top three things is well you know we have a revised budget um and we've been mandated that we need to take out 300 million dollars of cost over the next three years it's a bigger a lot of emphasis on cutting costs what you're hearing yeah people companies are being uh forced to do more with less um and I I again I I it is not it is not one particular industry it is not one particular region I see it across the board um so that's you know that's that's theme number one uh along the same lines although somewhat distinct and separate I would say that there's a great reprioritization of Technology uh you know customers and companies are shifting their focus to a smaller set of core Technologies core I.T projects and programs and prioritizing those that are mission critical or are true platform place um you know so you know every CIO every CTO that I talk to you know they've got four fine programs that they know over the next you know two to three years are absolutely must have in years past they might have had dozens of projects or you know dozens of maybe even hundreds of different end applications and point solutions that they were running and they're saying you know given the Mandate of item number one we need to consolidate we can't have all of these Point Solutions running all over the place and you know Shadow I.T and you know on veteran spent you need we need to take control and we want to do it with uh with vendors that we trust we have a good relationship on one hand or they're not a great relationship we want to do it with people that have robust end-to-end sight of our environment and that we want to create a strong relationship with um in the last theme that I'll mention James ties to you know your first point around uh you know this hype wave of AI I I don't think it's actual hype anymore I mean I do think that there is a bit of inflated expectation relative to where we are but there there is real much behind um AI in the Enterprise today and I see organizations of all forms and sizes embracing AI um and I think that's the first time that this is actually happening at the Enterprise level um every conversation I go to you know cxos want to know how can I use AI in my organization and so you know it's not surprising that uh I do iPath everything that we're delivering has an embedded AI layer across our entire platform suite and uh I think that the way in which uh we've been successful in doing this is actually creating solutions that bring together both foundational models so generative AI which is at the tip of everyone's tongue today along with specialized models and so things that are using you know your own proprietary sets of data training models based on that data and deploying in a flexible manner for the customer such as it's actually a lot faster more accurate and cheaper than General models I think people that um have single threaded themselves on Pure Play General models are uh are learning that it's actually quite expensive to do that you don't need something that understands everything to solve really specific use cases if you're a company that is a healthcare provider or a healthcare payer or you know there's a whole number of very specific sectors specific forms you don't need these super big powerful models to solve that specific pain point for you it's just you're talking about large language models you don't you don't need this large all-encompassing large a large language model you can do more of a niche focused language model yeah and you can you can actually train uh especially I call them specialized models but you can train specialized models actually using um some of the great learnings and inputs from General models and you so we you know we make those tweets we provide those specialized models for I forgot how many uh different form factors today but a growing a large and growing number and um you know we provide those out of the box uh to our customers and that's a really powerful solution um and again it's all about you know time to value for the customer ensuring that the ongoing cost is not you know so high because you're not bringing so much power to something that you know in of itself is uh quite small and uh it's a higher degree of accuracy and so that's really resonated with the market well let's let's talk about those companies that that have an RPA deployment they're using RPA in any number of ways uh it's it may be going really well for some of them they might be facing some challenges what is your advice to you know some best practices how should they optimize their RPA deployment as you see it I think you know there's a lot of customers that are on an inflection point right now and um you know I know the question isn't around AI but AI is actually acting um as a trigger point here uh for most of these organizations that's right yeah I mean they're listen at the end of the day every company is looking for ways to find efficiencies by automating routine tasks of course but uh increasingly they're looking toward ways to marry Automation and AI to go beyond just called savings and to drive growth Delight customers uh create better employee experiences I mean that's that's something that I think in a post-covered world as we have you know these hybrid work environments has become critical in terms of how companies both attract new talent but also retain their top talent employee experiences a vital uh uh okr and a lot of these in a lot of these businesses and so I think it's no longer actually enough to just deploy automation into your back office in in business processes I think I think that that was a really great way to get low hanging fruit um you know really easy to quantify Roi with customers in like 2016 2017 but the technology landscape is available at the means of organizations have a lot evolved a lot um the demands of customers and employees has evolved a lot and I think now that um you get to a point where you're trying to scale uh and leverage different types of inputs to reduce costs of course but also create better experiences and I think that it's an interesting uh turning point in it in such that it just so happens that all of these amazing technologies have now hit the market and it's up to you you know uh your board it's up to your management team to buy in creative ways by which to leverage this stuff in a way that is wrapped as a pure play solution um you don't have to go necessarily build yourself there are people who are doing this for a living or developing these Technologies for a living and so I think that's where we play a pretty vital role for our customers um Beyond just deployment you know I think there's something really to be said about how companies set goals for their automation programs I think you know many times Executives implemented technology uh like this you know they get some really good savings out the back but they don't treat it like a true business outcome they don't they don't set goals to incrementally improve those savings um and I what I've seen in the accounts that I work with is you know companies that really agree uh read the greatest rewards are those that assign a kpi to their automation team they're tracking it they're not just doing it they're doing it and tracking it anytime you're saving money if you know you're gonna if you're saving some amount of dollars and the savings is greater than the amount that you invested you feel pretty good about it you know it's it's like uh I think I I think an interesting analogy is like you know it's like your wealth advisor you know when the Market's up and things are going well and you get on the phone with your wealth advisor he says hey you you know you're up 10 on the year and the Investments we made are going well you say that's fantastic it's it's kind of hard for you to say well you know we made 10 but how you know how can we make 11 how can we make for you because you're getting some good news and you don't want to push you don't want to over optimize but that's a personal thing when it comes to running a company and cost of capital is high and you have all these other restraints around you actually that that next level of detail that optimization is required and uh I think one of the biggest mistakes that I see people make is actually not sending setting that incremental Improvement metric around their automation needs even when things are going well my dad my dad always told me growing up that uh it's best to fix the roof when it's signing out right makes a lot of sense yeah well I mean you you have talked about our uh our you know the RPA market and you've certainly checked about uipath some of the advantages um I'm asking a question because I I've written a lot about you know the RPA market and I maybe I'm thinking of that 2019 model myself I think about rpa's fantastic in terms of doing opposite automation you know you're saving that office manager is is is the software is doing a lot of jobs he or she might have done what's the new image and you've talked about it a little bit with your three layers but what what is the new image that that is not simply like office automation that like what the the current day uipath what does it look like as opposed to the 2019 UI pad the current image is a is a full stack business automation platform and it it encompasses all your needs around discovering the automations that your organization needs to be to bring um actually building those uh automations and then managing them at scale so often you know I walk into you know name your Fortune 500 company and you know I say hey Mr cxo I I hear you guys are are just getting started here and you know it sounds like you've had some really good success with your early deployment uh how can I be helpful and they say listen I know that there's manual work all over the place I have 10 000 employees in this country and Exiles and employees in this department and I get a million emails a week and we're spending all this money on all these different applications so I know the opportunity exists but I need someone to show me what to go fix when to go transform okay analyze the system analyze the system analyze the actual work that's being done what are my people doing every day what applications are they touching where is data moving to and from how much time is being spent what are the bottlenecks and we you know I I think the old way of doing this was you know you would bring in like an Outsourcing team and someone would document a bunch of processes they'd understand you know what that process looks like and then they try and re-architect the whole thing um with a new set of processes and a new set of systems and a new set of people I think the beauty about what has evolved today is that you don't need to transform your entire organization you don't need to create new processes you can just automate on top of what already exists that's a that's a key point I think I think a lot of people have gone through the you know the Erp you know rip and replace and migration all the customization that takes you know since decade-long projects that you know millions of dollars of services and software this is this is digitizing systems in days and weeks and it's systematically going through and understanding Based on data within your own environment what are the highest leverageable opportunities to automate and so I think you know the the new image is um you know our new tagline this Foundation of innovation uh-huh okay and so it's it's this movement away from just pure play like cost cutting and actually about you know agility and speed and accuracy and traceability within your own and within your organization and uh I think when you take into account you know all the components you have process mining task mining uh Communications mining in this in the Discover layer all of the new uh feature form within how we allow uh developers and business users to build automations and how we lower the bar in terms of requirements uh for them with things like artificial intelligence so that you can take natural language and actually transpose that into a pre-built process um for uh for your customers I think you take all of that and you've got something that has kind of eliminated all of the excuses as to why your company needs to exist in the way that it does today why those mundane processes are still there it's become it's become too easy to build too easy to Monitor and too easy to operate at this point well I think is a very compelling question that companies are wondering about is is the future of of RPA we've seen that it's you know the the RPA Market is not the way it was in 2019 it's far different in 2023 what's it going to look like say oh you know 2026 or so what do you see is the future of the RPA Market well we have you know we have a bunch of really exciting announcements uh coming out at our forward event in Las Vegas uh this October I think it's the 9th through the 12th um it's an amazing event you know we have like four or five thousand people that are our largest customers largest Partners sharing case studies the full executive team is there so for those who are interested and it's a great Showcase of actually all the new things that are on the Cotton uh you know I can't spoil all the surprises but right as themes across our offerings I I think you'll continue to see a few that stand out um yeah I think you'll see more tightly integrated Services across all of our offerings so that the experience and the cohesion and um you know just the end-to-end experience is more seamless I think you'll see a deeper level of solution uh to serve particular Industries and processes um more effectively you know this is kind of what I was talking about about some of the components and specialized AI like we want to get deeper uh within the industries that we think matter most in the economy and to to our customers and so I think um that will be another thing I think you'll see stronger Partnerships uh with technology behemeness like the one actually we recently announced with with sap that we're all really excited about it I think that's a great win-win for Our Mutual customer bases uh and of course uh AI embedded uh across all of it to maximize outcomes for our customers making those products more reliable faster and easier to trace uh value Brandon I think you said it it's going to be a an interesting sector to follow in the years ahead uh thanks so much for sharing your Insight today and I hope you come back and talk with us again sometime great thanks so much James

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