Robotic Process Automation in Procurement
The desire to automate and get rid of time-consuming tasks has become widespread for the Procurement world. While most Procurement leaders dream of AI, another technology might represent the perfect bridge between an old world and the fully-automated Procurement function. Organizations are dealing with a tremendous number of time-consuming, manual processes that are ideally suited for bots created with robotic process automation (RPA) technology. At present, P2P involves processes which are heavy in volume,
highly transactional in nature and again need an investment of both time and resources.
What is Robotic Process Automation (RPA)?
Behind this charming name, RPA is a type of software that imitates the activity of a human carrying out a task within a process. The term is derived from the idea of a “software robot,” an application that replicates the actions a user takes through the user interface of a computer system.
In other words, RPA records anything a user does through clicking on a screen or typing into a keyboard and then repeats those actions as directed. Software robots can complete tasks such as opening emails, completing forms, and recording.
What’s the difference with AI?
To put simply, an AI can learn from data and become better with time. RPA will remain the same. You will probably rely on some Machine learning models. It uses statistical analysis to “learn” from reams of data and teach a software application, using these lessons to make highly accurate predictions about specific types of data. Artificial intelligence allows software
to learn and interpret information, such as text through natural language processing, so that an application can communicate with and act in place of the user.
The good news is that bots can be enhanced with Machine Learning. AI can help procure-to-pay processes move away from an arbitrage-heavy model to improve overall delivery speed and quality. Another benefit of RPA emerges with the integration of machine learning.
Procurement managers can find and understand information faster and turn it into a desired outcome.Whether dealing with a supplier, internal department, or customer, natural language processing (NLP) can read the inquiry or listen to your voice, detect the meaning of the request, and highlight required information from the text to complete the task within parameters defined by the organization. This approach not only makes addressing Procurement needs easier and error-free, but also increases customer satisfaction and
reduces the time necessary to complete a task.
RPA and Procurement
Robotic process automation has become a buzzword most procurement professionals can’t ignore. Indeed, the benefits of automation provided by RPA can’t be denied. RPA can automate most steps of this process by minimizing human touchpoint. These include contract management, category management, third-party risk management, and supplier relationship management.
Moreover, RPA capabilities are useful in the area of financial risk management. Bots can identify changes in risk exposure and determine the causes. Approvals can be automated, as well as the detection of breaches of such limits and recommendation of potential remedial actions. Bots can also read through lengthy reports, contracts, and regulations to identify
gaps in compliance and provide insight on how to close them.
Another interesting application would be the ability to order goods without the need of humans. Software bots can monitor inventory, notify the organization when levels are running low, and automatically trigger a purchase transaction for a quantity that will build supplies back up to a predefined level. Through these examples, we can clearly see how beneficial RPA can be to an organization. A practitioner’s time can be better spent interacting with stakeholders or working on more strategic project, instead of repetitive low added-value tasks.
RPA Integration
Well, we have two types of RPA:
Independent RPA: The entire process is covered by RPA and requires no manual intervention as all most cases are covered.
Assisted RPA: RPA takes care of a given task and enables the owner to take decisions or next steps. This approach is better when tasks are not straightforward and demand human intelligence.
With that being said, the first step in your RPA journey should be to identify the tasks that could benefit from it, and which RPA you prefer. After a cost-benefit analysis to build the business case, and investigation of possible RPA vendors and their successful case studies, you’ll be ready to design a pilot project, making sure to build in future-oriented scalability.
Since RPA can be introduced to automate small, individual tasks, my recommendation is to begin implementing on a small scale, and learn.
Organizations might start out with something as simple as having vendor email attachments downloaded and filed into a specific folder. This might take an hour or two to set up and may only save you ten minutes a day, but it’s a starting point, allowing you to feel your way into RPA.
In the future, we can envision a scenario in which we would have robots on both sides as the buyer and the seller, conducting a negotiation.
RPA might seem like another disruptive technology. However, it is the best way to prepare your organization to AI. For many procurement organizations, adopting RPA should be the first step on the digital roadmap that helps sustain more complex initiatives further along.
