Business process automation (BPA) and the way it transforms modern-day business operations. This topic is getting increasingly popular these days in social media and business related press as next-generation AI-driven BPA solutions that have turned from something of a tech industry buzzword to a very real, and very effective, set of technology companies around the world that are rushing to implement these services in order to stay competitive and up to date with the latest business trends.
What is business process automation?
Business process automation, also known as digital transformation, or business automation, is a term used for the concept of automating complex business processes by incorporating new technological implementations. In the majority of cases, we are talking about repeating daily tasks that require consistency and often high attention to detail with automated processes. Thus, they need to be performed with a minimal error rate and these services mitigate the possible mistakes that are common with human interaction. Implementing BPA helps businesses to optimize and simplify working processes, making them more efficient, which affords a reduction in costs and improves the quality of products/services for the end-user.
As you can see, when people say “business process automation” or “digital transformation” essentially they are talking about keeping up to date with the way modern-day technologies can be used to automate, organize and improve your business. The reason BPA is getting so popular these days is that ultimately it allows companies to cut costs and increase profits — something any business seeks naturally, but especially during times of crisis and instability such as the ones we are living through right now.
What are the business needs driving automation?
What are the main reasons businesses are looking to implement BPA solutions for, what primary needs companies are trying to satisfy, and which goals to achieve? It may sound a bit dramatic, but for many companies, from small to medium enterprises (SMEs), to market leaders, and giant multiprofile enterprises, it’s survival that is at stake. According to a Forrester report’s prediction, companies that master automation will dominate their industries, which means without BPA giants may lose their market positions fairly quickly.
But if we skip the dramatic predictions and look into the more specific business operations needs that are driving automation, probably the three major ones would be: cutting costs/increasing profits, minimizing human errors, and speeding up the processes.
Cutting costs/increasing profits.
Making more money is the essential goal for any commercial company, and so it is perfectly natural that businesses are constantly looking to reduce costs and increase profits. That’s why most BPA tools, in one way or another, are aimed at making processes as cost-efficient as possible. According to a 2019 PA Consulting report, almost 40% of surveyed organisations that invested in AI and automation solutions in the last five years, already see a reduced cost and increased revenues as a result of these investments.
Minimizing human errors is one of the most important parts of automation in any field. Successful implementation of BPA tools helps companies to make their businesses more streamlined and error-proof, achieving next-level efficiency. That’s if BPA was implemented right, of course. A report by Ponemon Institute says human error is to blame for 22% cases of major unplanned outages. Automation could help to significantly reduce this number and, ultimately, bring it down to zero.
Speeding up the processes.
In today’s world, business is all about speed. All parts of every business process are getting accelerated, making it difficult for us, humans, to keep up. Which, again, leads to human errors. Automation makes everything faster and more efficient — robots and programs are taking a load off human’s shoulders. According to this research paper, automation should result in the average speed of manufacturing more than doubling globally over the next several years.
Using robots in warehouses (Aitheon platform)
What businesses use automation?
The short answer would be: all of them, small to medium businesses, as well as large corporations, use BPA in one way or another. Executives and business owners of any level understand how extremely important automation is, so they are mostly going for it as much as they can afford to. Now, in a turbulent time, especially. Actually, a recent survey by KRC Research says that around 80 percent of executives polled agreed they could save at least 360 hours a year with automation. So companies of all sizes are increasingly looking for automation solutions for pretty much every major business process.
As an example, according to the World Economic Forum’s report The Future of Jobs 2018, “by 2022, 59% of employers will have significantly modified how they produce and distribute by changing the composition of their value chain.” And by the way, it’s not just businesses who typically benefit from automation in the long run. Employees are also the winners. According to the results of this survey, 86% of respondents said automation makes employees more efficient and productive, by taking a load off their shoulders.
As for the specific industries which are benefiting from the business automation today more than others, there’s a number of them. Here are few examples.
Automotive industry historically has been one of the major pioneers in business processes automation. Today industrial robots are responsible for a large chunk of work in automotive manufacturing, like burning welds, assembling and painting cars, and much more.
Consumer electronics manufacturing.
Another industry that is very big on automation is consumer electronics. Lately electronics manufacturers have been rushing to implement the most efficient automation solutions to get ahead of the competition, which is fierce in this market. For example, Beyerdynamic, a German audio equipment manufacturer, reported they were able to increase their factory productivity by 50% in 4 years thanks to business processes automation and robotics implementation.
Food services are getting automated at an increasing rate, especially in the last several months after the COVID-19 epidemic has started. Restaurants are starting to integrate robots in their processes to increase efficiency and lower the chances of bacteria getting on food in the kitchen and by reducing the risk of exposure to their employees. Restaurant chains are the most active in this field as automation allows them to standardise their offers throughout all the locations of presence.
We could go on and on. Medical industry, accommodations, agriculture, transportation, construction, mining, etc. Companies in pretty much every major industry in the world are looking to automate and implement robotic solutions to increase sales, cut costs, or simply stay afloat in this difficult economic time.
What are the top business processes for automation?
McKinsey & Co.’s estimate says that you can automate around half of all business processes. Of course, it makes sense to start from daily, routine and repetitive tasks that are simple enough for a seamless automation. And, if we are talking about priorities here, obviously it makes sense to give your business a quick review first, and start automating with the most strategically important parts of the business. Or begin with less important ones first, to avoid risks related to automation errors, and strategic mistakes. The review should help to decide which way to go.
If you are looking for a specific example, here are a few business processes that are getting automated most frequently:
- Management of documents;
- Collecting and sending documents for approval and signing;
- Customer support;
- Email marketing operations (like follow-ups, feedback, or leads collection);
- Keeping a working calendar and daily schedule;
- Identifying image and video recording content;
- Any basic task, which requires data copy-pasting from one source to another.
Why business automation is good for the economy?
Automation brings countless benefits to the economy and moves it to a new, higher level. Here are a few basic examples of the effect business automation has on the economy.
Lower production costs lead to economies of scale.
The economies of scale emerge when increased output leads to lower average long term costs. The principle of the economy of scale is quite important in many industries, take consumer electronics manufacturing, mentioned above, for example.
Lower production costs lead to economies of scope.
Here is another economic principle: economies of scope occur when a company can get efficient enough, thanks to processes automation and lower production costs, to be able to produce a wide variety of different products. The benefits for the consumers would be: much greater choice and diversity of products, product customization options (different kinds of the same product), greater personalization of the product and customer experience, and so on.
Increased business mobility.
Companies having to handle a lower amount of manual day-to-day activities allows them to stay more flexible and mobile, adapting to the market demands quicker, which, again, brings us to better customer experience and a healthier economy in general.
Business risks of Business Process Automation
One of the most common concerns when it comes to business automation is jobs displacement, of course. And it is a serious issue that requires careful planning and strategic solutions.
Although, when it comes to jobs and automation, data shows us further BPA adoption would not necessarily result in fewer jobs in total. Often even more new jobs for humans emerge as a result. For example, at the end of 2017 Gartner released a report, predicting that by 2020 AI and AI-related solutions integration in business processes will create 2.3 mln jobs while eliminating just 1.8 mln. The results of a forementioned survey by PA Consulting support this data: 43% of employers who have introduced AI and automation in the last five years saw more new jobs as a result. Employees surveyed also said automation makes jobs more complex and interesting, with greater learning opportunities.
This is a good point against, so to say, automation alarmists: BPA, when executed properly, results in the creation of more jobs than before, and increases the level of these jobs, done by humans, while robots are taking care of “dirty work.” The opposite is also true: lack of investment in automation in the US and UK is one of the main reasons for poor growth in labour productivity in these countries, which led to ineffective production and lower number of jobs as a result.
As for the BPA risks from the business point of view, they certainly exist. Here are some of the most common risks:
Automation often requires significant investments.
Benefits of BPA may take years to deliver results like decreasing costs and growing profits.
Specialised labour requirements. Automation tools are developed and integrated by highly qualified workers, which may be a problem to hire in certain locations.
Some kinds of automation may lead to lower customer satisfaction and a decreasing number of clients. An example: too much automation in customer support (chatbots talking to clients instead of humans) often affects customer satisfaction in a negative way.
How to introduce automation into your business
Ok, so if you read up to this point, you can probably see that all the information above can be essentially boiled down to one key point: your company needs business processes automation, and the sooner BPA starts, the better chances you will have to succeed. Or at least stay afloat. Don’t know where to start?
1. Define automation goals.
Careful planning and strategic approach is very important in business processes automation, as the adoption of new technologies can have a significant impact on overall business operations. It means you should start with having a clear understanding of which processes to automate, and how this will reflect on other operations. Start automation from the most important and/or time-consuming tasks and processes, automating which would result in greater benefits for the company.
2. Pick your Business Process Automation tools.
Of course, there is always a need to decide which tool or a set of tools to choose for your Business Process Automation implementation.
Aitheon is an innovative business software platform with over 20 services that allow companies to automate the majority of their business operations. One of the key solutions is Core – an automation platform that connects all services within Aitheon’s platform and allows integration with any third party software via API. With Core, you can build automation workflows via a simple drag and drop interface. Once you have enough processes running and automated, Core engagesz it’s machine learning algorithms to model and suggest more efficient workflows.
Creation of Process Automation in Aitheon platform
As you can see, modern-day business process automation solutions are easily accessible, quite affordable, and, in many cases, fairly simple to start using. And reasonably powerful. Even if you start business automation from implementing small tools and optimizing minor processes, it will have a positive effect on your business performance, which will synergistically increase with the integration of additional, more sophisticated solutions. And, we really can't stress this enough, with Business Process Automation you really want to start as soon as possible, as you don’t want to be left in the dust by faster, more effective, and better-organized competitors.