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For most organisations, business process automation (BPA) is about driving down costs. It does that by eliminating manual processes – a polite way of saying it replaces jobs and cuts the payroll.
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Although they seek the same cost and efficiency gains, companies in Australia and New Zealand turn to BPA for other reasons – it allows them to leverage their relatively small workforces, delivers the speed needed to deal with intense competition and it can boost quality.
“New Zealand is relatively advanced in automation when compared with places like North America,” says Simon Baxter, sales and marketing manager for the collaboration practice at Spark Digital, New Zealand’s largest technology integrator and a subsidiary of the country’s major telecommunications company. “That’s because the economy here is built on small and medium enterprises. Organisations in North America tend to be larger – they have more people and have the human resources to use more manual processes. They have far more paper trails than we are used to. I worked for a while with Veteran’s Affairs in the US, where everything was paper-based. There’s nothing like it in New Zealand,” he says.
Companies in Australia and New Zealand have little choice about automating, according to Baxter. “New Zealand, for example, is a small country with a small economy. There aren’t the revenue flows needed to justify employing the volume of people you might see working elsewhere. We invest more in automation,” he says.
BPA allows companies to scale quickly. Baxter says he knows of startups with only a handful of people using automation tools to deal with complex processes where they don’t have staff to cover.
There’s a second reason ANZ companies embrace BPA: competition. “There’s less business to go round, so the market is highly competitive. Every company in a given market chases all the business all the time. Sales don’t come in through the door. That means successful companies have to be highly efficient,” says Baxter.
He says the move to cloud-based systems is making BPA available to a wider range of users and more applicable to systems that mix applications from different suppliers. If the right application programming interfaces (APIs) are in place, cloud makes it easier to connect applications to each other and link with external systems, including those used by customers or partners. That’s important because, until recently, BPA was usually associated with larger organisations. In the past, companies and other organisations needed a substantial, robust enterprise infrastructure to move from complex paper and manual processes to fully digital workflows.
One way to achieve that is by investing in enterprise resource planning (ERP) software which packages the functionality of individual apps into an integrated whole. In that world, BPA is largely about building workflows through these systems.
This is the approach used by Greentree, a supplier of ERP systems for mid-market customers. The Auckland- based company’s business management software is installed in more than 10,000 sites worldwide. Most are in Australia, with some in the UK and New Zealand. Greentree CEO Peter Dickinson points to a system his company built for Griffiths Equipment, an Auckland- based importer and distributor of automotive spares. He says the company’s owner, Peter Griffiths, works in an industry where delivering the right stock to the right store at the right time is essential. The margins are not high and customers can fine Griffiths for incorrect deliveries.
Although the company was getting deliveries right more than 99.9% of the time, even that level of error was costly. Dickinson says Greentree helped fix this, reducing the error rate by moving from a manual process to an automated one. Orders arrive directly in the Greentree system and the information is sent to mobile devices telling warehouse workers where to find each part. Their routes around the warehouse are optimised and they scan boxes to make sure they select the right part. Griffiths says automating the process means the error rate has dropped from around 200 out of 40,000 shipped items each month down to around 10 items.
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Dickinson says automation is a differentiator for Greentree. “We constantly hear people talk in terms of business intelligence. It’s powerful, but right now process intelligence is more critical for mid-market companies,” he says. Dickinson defines process intelligence as doing automation well. In some cases it can mean embedding artificial intelligence elements into systems. “Greentree has many workflow applications, including a full business process management suite which sits across the whole product,” he says. “You can connect anything across any of our operational systems: manufacturing, service management, human resources and so on – the dots can all be connected. Our workflow desktops have pop-up screens displaying relevant information to users the moment it is available. We have a big rules engine at the back so customers can decide what happens when this condition is met and so on.”
Many BPA implementations are about reducing paperwork. Dickinson says Greentree offers a full electronic data interchange (EDI) suite, which is a form of process automation. “Our customers use EDI so that paper isn’t handled by humans. It may be an old standard, but it remains relevant because you can set up a pre-determined communications protocol,” he says.
Beyond EDI, Greentree uses electronic documents, or eDocs. Dickinson says this is a softer, more flexible way of automating paperwork than using EDI. “With EDI you need to get partners and everyone else lined up to use the technology, whereas eDocs is more a case of, ‘Send it to me however you will. I’m not going to dictate formats. We’ll manage it at our end’,” he says.
Artificial intelligence can make sense of incoming eDocs. Dickinson says the technology uses machine learning to understand how to scrape freeform information on pages. The intelligence is able to dissect documents that it has never seen before and find relevant fields.
Selling BPA to the mid-market is not for the faint-hearted, even in automation-aware countries such as Australia and New Zealand. Dickinson says potential customers are scared because they saw large enterprises climb on the first wave of the technology, with projects involving teams of expensive consultants. It cost a fortune, took a long time to implement and there were cost overruns.
To get around this, Greentree takes the opposite approach. Dickinson says the key is not to build a corporate
ERP system designed to solve all of a company’s problems, but to focus on the most pressing improvement, automate that and, when that’s fixed, move on, fix the next trouble spot and so on.
Operational intelligence, according to Dickinson, is the art of making sure everyone in a business has access to the right information, while process intelligence is what you can sensibly automate to make sure there are no cracks in your business workflows. “These ideas are no longer just for corporations,” he concludes.
Bill Bennett writes about technology and business for newspapers, magazines and radio. He is based in Auckland.