Automation Center of Excellence: A clearinghouse for best practices in an organization’s automation journey. It can include members of business, IT and project managers who oversee automation projects within the bank.

An automation center of excellence (CoE) can help drive efficiencies throughout an organization.

“Whether you call it CoE or you call it an ‘automation hub’ or ‘maintenance,’ the center of excellence usually helps to centralize resources, drive cost efficiencies, and identify which business processes become eligible for automation,” Deloitte principal Parth Patwari told Bank Automation News.

Deloitte, a “Big Four” accounting agency, helps banks and other companies establish CoEs and identify processes for automation. Patwari said the top 10 banks in the U.S. already have established automation centers of excellence, although the names for them may vary. Truist, for example, has a Center of Excellence for Intelligent Automation. The centers allow banks to shift from one-off automation projects within the lines of business to driving automation change throughout the organization, Patwari said.

In effect, an automation CoE allows banks to bring best practices and skill sets under a centralized umbrella, which then acts as an internal consulting group. This keeps costs down by preventing the lines of business from hiring duplicate skill sets or spending time and money to relearn processes that have already been mastered elsewhere in the organization.

Generally, CoEs are driven by IT executives and bring together business and technology leaders to create best practices around a process. Typical CoE types include project management, agile development, DevOps and change management, according to research and advisory firm Gartner in a report called “Ignition Guide to Establishing a Center of Excellence.”

Here are three key areas to consider when standing up or optimizing an automation CoE:

1. Build the business case

Before committing to a CoE of any type, it’s important to prepare a business case around the priorities that business and technology leaders care most about, the report stated.

Having a business case simplifies funding for the automation CoE, and banks may not have to search hard for a cost justification. Typically, automation CoEs are driven by business triggers, such as a push for cost reduction, board pressure to increase efficiency ratings or a need to increase speed to market for automations, Patwari said. Banks might also benefit from a leader who wants to create agility and velocity within the organization, he added. Technology leaders might also want to look for allies in finance, which Patwari said frequently becomes the flag-bearer for an automation CoE.

2. Staff the CoE

Five to 10 years ago, finding the technical skills for automation would have been the biggest challenge to staffing an automation CoE, but now this can be managed by using onshore or offshore developers to bring down costs, Patwari said. In fact, Deloitte itself has bank clients who manage the technical aspects of automation using offshore developers to drive down costs, he added.

While anyone with technical expertise on staff should be included in the CoE, it’s important to find employees who understand the ins and outs of the banking processes, Patwari advised. “The biggest hurdle in front of the organization is to identify which processes to automate, how do you consider a process to automate, what are the criteria for that, crystallizing that process,” he said.

When staffing a CoE, it’s important to identify employees who can target processes for automation. Identifying processes can be tricky, Patwari said, because a bank must break every process down into its components, including human intervention, and determine where automation is possible.

The roles and responsibilities that should be included in a CoE include the head of the project management office, or other, similar area within IT or the business in general, as well as designated CoE project leads, according to Gartner.

3. Prioritize projects and set metrics

In general, it’s important to clearly define the CoE’s objective and associated success metrics, Gartner advised. That may vary by process. Banks also must do an activity-based cost analysis comparing a current process with the potential cost savings of an automated process, Patwari said.

“There are hundreds of thousands of processes that run across the banks,” Patwari said. “Unless and until you know how humans are intervening, and at what level, it’s hard to figure out” what processes will benefit from automation.

Technical skills shouldn’t be a barrier to automation. Patwari cited, but did not name, a Deloitte bank client that focuses on identifying processes, then outsources necessary coding to an offshore team to drive down the cost of automation.

“It doesn’t have to be cost-heavy aspects to the organization,” Patwari said, noting that establishing a CoE can lead to reallocating employees into revenue-generating positions.

Do’s and Don’ts

• Do invest up front in creating a CoE activity catalog that outlines its key offerings, benefits, prospective internal customers and the CoE engagement process.
• Do invest in ongoing communication and engagement with internal customers. Highlight success stories and progress against specific metrics. Focus on building the CoE’s credibility and utilization within the bank.
• Do conduct focus group discussions with project delivery staff to uncover any project management pain points.

• Don’t give only a bird’s-eye view of the CoE mandate. Internal customers need to know specifically how the center will partner with them.
• Don’t take a big bang approach to a CoE launch. This can create resistance among internal customers and lead to a perception of the CoE as bureaucratic auditors. This is a potential pitfall, especially for automation projects, which often generate fears over job loss.

Bank Automation Ignite, on April 13-14, is the event for inspiring automation initiatives and investment in financial services. At the virtual event, financial services professionals can discover new use cases and technologies that are accelerating automation in banking. Learn more and register at www.BankAutomationIgnite.com.