“Agility” is a term used frequently by analysts and business leaders to describe their vision of an organization that rapidly adapts to change. In the last decade alone, businesses have spent millions of dollars on efforts to improve agility by increasing collaboration across different business silos, partners and locations. Much of this work has focused on sharing information in the form of reports, files and transactional data. While sharing information is important, it’s also critical that these disparate parts of the business execute core processes with tight coordination.
Complex activities such as managing the supply chain or keeping up with customer billing cycles often mean that process owners invest a lot of manual hours simply monitoring progress and coordinating through emails, checklists and phone calls. With all of that manual effort, the tasks at hand are completed and business moves forward. However, any slip along the way can cause costly delays that risk both increased cost and decreased customer service. Any process that depends on a lot of manual work runs the risk of being completed inconsistently or without appropriate documentation. When the number of manual steps grows, so do the chances that something will go wrong.
Top performers avoid hidden risks
Recent research from The Hackett Group found that “top-performing IT organizations focus on automation and complexity reduction as essential IT strategy elements.” The Hackett study continues to explain that these top performers automate up to 80 percent more business processes than other organizations. As a result these companies carry 70 percent less complexity in their technology, spend 25 percent less on labor and use 40 percent fewer applications for every 1,000 users.
Leading companies will use this kind of process automation to achieve even greater agility in 2015. They’ll apply it to core IT processes like SAP system copy and business activities across the accounting and finance departments. Aside from repositioning some of the best employees in a company for increased success, process automation also eliminates unnecessary latency and guarantees a level of coordination, consistency and accuracy that’s impossible otherwise.
Successful supply chain services
The supply chain is often one of the most complex processes a business has to face, and process automation can make a dramatic difference.
A large, multinational manufacturer needed to coordinate many activities across diverse applications that included more than 30 critical systems. This meant controlling corporate master data, financial processes, production processes, warehouse functions, sales processes and customer service functions from one connected source. This coordination was required to make sure that orders for products were aligned with sourcing the materials needed to manufacture them, and, finally, that the manufacturing facilities were properly tasked with the correct information on what to make and where the final product should go.
If there were any inconsistencies at any stage, the company risked sending home thousands of factory workers who didn’t receive the correct production information. After this happened a few times, management took a long look at how they coordinated their processes and decided to automate them.
Now the company has automated 250,000 workflows and coordinated cross-system processes with cross-platform technology. Each step in the supply chain is accurate and coordinated—from ordering to manufacture and delivery. The entire process is monitored from a single, central location and any stakeholder in the order-to-delivery process can track progress in real time.
Behind the bills
For many companies, such as utilities, the billing process is both the lifeblood of revenue and also a logistical puzzle with many pieces of transactional information, complex calculations and the need for absolute accuracy. Billing also has to be executed within exact, but often shifting timeframes, too.
As with supply chain processes, billing tasks require standardized execution and frequent repetition of many process steps. These factors make billing processes risky if they’re done manually, but they also make it a perfect candidate for process automation.
One of North America’s largest utility companies brought its outsourced billing processes back in house by automating its key meter-to-cash processes. Its goal was to reduce costs and improve customer service at the same time. However, the billing process was very complex. It involved more than 65 internal and external interfaces. It also required gathering data from collection agencies, insurance companies, external metering systems and other sources.
When the in-house automation project went live, all systems were running according to plan on the first day. By the next morning, the company produced and sent out 50,000 accurate bills in less time and with much less effort than ever before. The company hasn’t missed a single billing deadline since. For this company, automation means great service for their customers and a rapid revenue stream for the organization.
It’s always a challenge to get the speed, coordination and assurance of customer service any business really needs. Manual effort — or even manually sharing transactional information — simply can’t guarantee that incorrect or incomplete process execution won’t stall service issues and leave customers hanging. Complex processes that support the business require as much automation as possible. It’s the key to achieving agility.
Jeff Rauscher, director of Solutions Design for Redwood Software, has more than 31 years of diversified MIS/IT experience working with a wide variety of technologies including SAP, HP, IBM and many others. He has worked in operations management, data center relocation, hardware planning, installation and de-installation, production control management, quality assurance and customer support.