ERP News – worldwide – erpnews.com – If you work for a large organization, chances are that you’re quite familiar with the concept of Business Process Automation (“BPA”). However, many smaller businesses may have heard the expression but are either not sure what it exactly encompasses, or think that it’s just for larger enterprises.
So what is BPA? It’s essentially the automation of processes using software (and software integration), eliminating and/or streamlining manual processes, in order to save costs (usually HR costs), speed up processes and eliminate errors. It’s important to note that effective BPA will often eliminate redundant pieces of software as well as reducing the need for human intervention.
BPA examples include:
- Document management and workflow – when a completed claim form is uploaded to an insurance company’s portal, BPA software scans the form for a bar-code that identifies the file and claim numbers, and then routes the completed form to the relevant claim adjustor’s inbox, and updates the file’s claim status to “submitted”. This in turn triggers an email to the claimant, and creates a task and due date for the adjustor.
- A distributor receives orders from customers via a website and Amazon. These orders arrive electronically and are imported into their ERP Software System. BPA scans the incoming orders based on pre-established criteria, and routes them automatically – if OK to ship, pick tickets automatically spit out in the appropriate zones in the warehouse.
Many small and medium sized business (“SMB”) do in fact use bits and pieces of BPA to automate aspects of the business, but it’s not usually part of an overall business strategy. The benefits of BPA if properly implemented are clear: save time and money, reduce errors, and improve the bottom line. Seems like a no-brainer, right?
But there are three factors that typically constrain the SMB from even starting to look into business process automation as an overall strategy:
- Lack of knowledge – many SMB owners are simply not aware of the potential to automate processes. Entrepreneurs typically focus on their product or service, and sales, and in a smaller organization you may not find the level of operational management experience or knowledge of BPA. These companies usually solve bottlenecks by adding more employees to the mix.
- Cost: if you do a search for BPA vendors, you’ll find that most appear to offer costly solutions – in the tens or hundreds of thousands of dollars, and that can deter any SMB form even looking further. However, please rest assured there are some very affordable BPA solutions out there – particularly in comparison with the ongoing cost of hiring additional employees.
- Lack of defined processes: probably the biggest practical obstacle is that many (most?) SMBs do not have well defined processes. There are often many exceptions to whatever processes are in place, and they are usually based on the knowledge in someone’s head. This is not necessarily always a bad thing, it’s just a fact of life. But you cannot automate a process that cannot be accurately defined.
In terms of the tools necessary to do the job, you may already own some fairly good ones. Do you have ERP software that offers workflow automation, but you’ve just not taken advantage of it? Do you have different pieces of software that don’t integrate with each other, but could?
In future blog posts over the next few weeks, we’ll explore some strategies for identifying bottlenecks that could be automated, with a couple of real life examples, and we’ll review some 3rd party business process automation software tools. Stay tuned.
