Why is automation the #1 Priority for companies.

2 December 2018

Strategic vs Tactical


Strategic innovation has become increasingly important considering the rapid advancement of technology, and increase in competition. Startups have an edge over larger firms as they have designed their processes in line with recent technology. For firms that have antiquated systems, or that are not able to change their processes and adopt certain tools and technologies, the increasing tactical tasks cause a decrease in agility. Hence, automation becomes a key to control costs and increase agility. With tactical tasks automated, employees can better focus on strategic tasks that help the firm innovate and grow.


What is Automation?


McKinsey suggested that up to 30% of a firm’s day to day tasks can be easily automated. But what exactly is automation?


Automation is simply bots conducting manual and repetitive tasks that involve simple business rules, steps and workflows. High volume, rule-based, standardized tasks are usually a great fit for automation considering they return higher ROI. According to Deloitte, an RPA bot could perform even a complex task with about 600 steps. Tasks that require copy pasting, navigating between screens and software, entering data and querying data are usually automated.

What makes procurement a great fit for automation?


Considering, procurement teams currently spend a lot of time on administrative part of contract life cycle management and tender processes, which are merely repetitive tasks, automation can help streamline the process. With such tasks automated, procurement professionals will be able to focus on opportunities during negotiations, work with suppliers to innovate and the collaborate with business functions to find the right suppliers.


Therefore, with automation, the procurement function will become more of an innovative center that adds real business value in terms of collaboration and innovation.

If everything is good, why don’t all organizations adopt Automation?


One of the biggest concerns for adopting automation change management. Organizations are resistant to change and might not have a sufficient budget to initiate such a transformation. There are several other problems that companies might face when implementing RPA:


  1. Training and informing employees regarding the change in processes is an important part of the transformation. Ensuring that employee morale does not fall down as work roles shift

  2. Another problem is trying to map an exact process without evaluating the need to change certain parts of the process. This results in lack of scalability

  3. Automating in silos instead of cross functional

  4. Lack of proper system for maintenance and repairs

  5. Not finding the right talent to scale and maintain it


Why 92% of companies are still aiming to adopt RPA by 2020.


ISG reported that 92% of companies are aiming to adopt RPA by 2020. The main reason why companies still plan to adopt RPA is savings due to lower costs. One other big draw towards robotic process automation is the higher accuracy rate. Tasks involving payments benefit from RPA due to the need for high accuracy levels. As bots work 24x7, time is saved which leads to more time for value added activities including market research.


RPA helps streamline a process, removing broken links. Often due to lack of consistency processing invoices manually, information is not recorded and stored in an organized manner. Paper invoices or invoices on emails may get lost. With automation, there is consistency and true visibility of complete data and the invoices are organized systematically as the process is repeated through bots. Hence, there is no broken process. The complete visibility of the data gives an opportunity for firms to utilize the granule data to conduct analytics around opportunities for risk and savings. 


Other benefits of RPA:

  1. Better data security

  2. Eases a complex process by interacting easily with different systems

  3. Improved quality and control on purchases



The Institute of Robotic Process Automation says that RPA costs about 1/3rd the price of an off-shore FTE and 1/5th the price of an on-shore FTE. Hence, there increasingly more firms automating their processes at their center of excellence centers. Hence, even though there are certain risks involved with automating the procure to pay process, firms will eventually have to automate the process if they want to remain competitive. It is important to note that not only do firms require to consult the right automation partners, but also build knowledge in-house by hiring and training employees to take the automation transformation forward successfully.




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