Robotic Process Automation (RPA) software market is expected to reach $12 billion in the next two years as the majority of the companies will turn towards automation. In 2018 alone, RPA software revenue grew by 63.1%. A report by KPMG asserts that in the next 10 to 20 years, automated or robot labor will replace 47% of the jobs. And like all other business areas, supply chain management (SCM) will be significantly impacted by this change. Within a typical Supply Chain Network, various repetitive activities are handled manually regularly. It not only slows down the operational process, but it also leaves room for errors and anomalies. The use of RPA tools can reduce these errors and execute activities at a constant pace. Automation can allow employees ample time at hand to focus on solving novel problems and brainstorm work, instead of wasting time behind activities that can be done by robots.
RPA vs Traditional Workflow Systems
RPA varies significantly from traditional workflow systems. Some of the examples of traditional workflow systems are ERP and CRM. On the ground of automation approaches, traditional workflow executes tasks that have fixed sequence and limited conditions. It uses APIs for backend integration. However, RPA extends these capabilities by working with a rule-based engine to perform various actions which include recording and replaying of user-performed activities using UI. Knowledge management in the traditional workflow is manual, whereas RPA automatically captures patterns of data for unique situations that can be used for future analysis and improvement. Traditional workflow does not have self-learning capabilities. It depends on humans and their willingness to learn for future improvement in processes. However, RPA can be combined with machine learning and artificial intelligence to improve its accuracy and understanding of varying scenarios. Traditional workflow cannot handle unstructured data, whereas RPA can use features like OCR (Optical Character Recognition) to capture those data.
RPA Implementation in SCM
Some of the most common processes within the supply chain that can be automated are order processing and payments, partner on-boarding, tracking and scheduling of shipment, invoicing, procurement of raw materials and inventory handling, planning of supply and demand, and customer services. RPA can help in the elimination of manual input, whether it is for administrative tasks or purchase orders. It can handle requests for proposals, questions and quotes, and help in increasing the return on investment (ROI). It can also help in the establishment of new engagement levels in the supply chain. B2B processes can be automated without incurring a high cost. RPA integrates with other existing supply chain tools seamlessly. Though researchers recommend updating foundational information systems for efficient RPA integration; however, organizations do not have to replace the current tools and software it uses to conduct its business. RPA can successfully integrate with them and function as expected. Furthermore, RPA can also continuously analyze tasks it has been assigned to recommend more efficient methods for improvement in the future.
We have listed below a few of the areas in supply chain management where RPA can be used successfully:
Communicating Shipment Status
RPA can open and read emails received from concerned parties. It can recognize and extract useful information for further processing. It can sign into an SAP/Oracle portal to fill in the extracted data from the email. Further, it can also examine shipment status, reply to the customer, and continue processing the next email.
Vendors-Suppliers Performance Management
RPA can continuously track the performance of the suppliers by cross-checking with their Service Level Agreements (SLAs) or Key Performance Indicators (KPIs). If RPA detects any deviation from the pre-defined SLAs/KPIs, then it can generate an alert. The same method can be used for other cases within the organization, such as damages of products, pilferages, and others.
Vendor-Supplier Relationship Management
RPA can prepare a request for proposal (RFP) or request for quote (RFQ), communicate RFP/RFQ with the vendors, analyze the documents received from the vendors, evaluate the suitability of the vendors, assess their credit history, and finally select a vendor.
How your business can ride this change?
After reading this far, you must have realized where the future of Supply Chain Management is heading. Robotic Process Automation has enormous potential in SCM. If you also want to increase efficiency and save cost in your business processes, then we recommend you to consider RPA. Prior to the implementation of RPA in your supply chain management, there are a few pre-requisites that you should consider. These are listed below:
Standardized Process
The processes that you want to automate should not be complicated and ever-changing. It should be stable with limited checks and balances. Implementing RPA for a complicated process is not impossible, but it will consume more time and cost for your organization.
Robust Information Technology Infrastructure
The entire RPA implementation depends on IT infrastructure. A volatile IT setup will create regular issues and halt activities now and then. One process may depend on another in a typical supply chain network. Therefore, things may start to fall like a domino if there is a gap somewhere in the IT infrastructure.
Change Management
Not everybody within your organization will agree to the change. People will resist it if the change seems like a threat to their job, or position within the organization. You have to ensure that the expectations of all the stakeholders are met, and they get as they expect from RPA. No doubt, RPA may bring some adverse effects where employees may have to upgrade their skills to stay relevant. However, strong leadership can ensure that acceptance is even. You can resort to good old management theories to make the change. John Kotter, a professor at Harvard Business School, and a renowned expert on change management suggested an eight-step change model. You can read it in his book, Leading Change, published in 1995 by Harvard Business Review Press.
About us
We provide RPA solutions to businesses operating in various sectors. Our excellent team, at RPATech, can help you streamline your business processes and beat the competition. If none of your competitors is using RPA, then you can take the benefit of first-mover-advantage in your industry and get ahead of others.
