ProcureCon IT Sourcing 2020

June 16 - 18, 2020

Sheraton Denver Downtown Hotel

Ask Joanna

The CPO's Corner

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Question:

How can you prepare for the shift to RPA and is it really worth the investment?

Joanna's Answer:

It’s easy to jump to the conclusion that your company is too small to take advantage of Robotic Process Automation. But the range of possible applications may be broader than you think. A careful analysis and expert guidance are required to make sure your firm develops the right plan and clearly understands the opportunities. and that you proceed in the right manner.

Some thoughts to ponder:

  • The rule of thumb, according to a former associate and RPA guru Jeff Wallach, is that a solid business case can be built when internal labor is reduced by 60 – 66%.
  • Think about how you collect the data. One Northeast manufacturing company employed a cadre of consultants to watch their employees’ every move. Found some opportunities but caused a lot of angst. You can avoid that by doing some triage in advance: identify in advance repetitive tasks, those for which there are few or no backups available, and those are time sensitive. Concentrate there first instead of disrupting the entire organization.
  • Is there significant client interaction required for a set of tasks? Not a candidate for RPA, not yet anyway. Instead, focus on tasks that don’t take any real creative thought (like transferring information from a paper form to a spreadsheet, or pulling information from one document to another)- those are the RPA candidates.
  • Don’t try to build this internally without really understanding the capabilities out there within RPA providers. Likely you can move further, faster and avoid capital investment by purchasing RPA as a service.
  • Processing 1 million invoices per year? It’s probably a smart decision to move to RPA. 100,000? Not so much – unless you buy a “piece’ of a robot. Your company may not be able to “afford” an entire robot, but by using a third party you may be able to “share” a robot.
  • Expect resistance from your current outsourced providers. They’ve invested significant sums in facilities and labor and may be receiving grants from their governments based on the number of people they employ. RPA is a negative for them.
  • From this point forward – even if it doesn’t work now – anticipate that at some time in the future RPA may work for you. So make sure that the appropriate exit clauses are embedded in all your contracts. As this space is advancing quickly, you don’t want to be in a situation where an onerous exit clause stops your company from moving forward.

In closing, I suggest you make a firm effort to stay on top of this. Particularly with the concept of fractional RPA shares, the bar keeps moving lower and you want to be ready to make the leap as soon as your company’s process and the technology capabilities align.


About Joanna

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Joanna Martinez is a global procurement / supply chain leader and the founder of Supply Chain Advisors LLC. She is a frequent lecturer and blogger on procurement topics and also provides coaching, strategy development, training, and cost reduction opportunity assessment. Her clients range from Fortune 100 companies to technology startups.

As either regional or global CPO, Joanna has led transformation initiatives for companies in many different sectors: among them Johnson & Johnson (consumer products), Diageo (beverage), AllianceBernstein LP (financial services) and Cushman & Wakefield (real estate services, property management). She has also held client-facing roles, effectively giving her the opportunity to “sit on both sides of the table”.