Business Process Automation: Ultimate Guide

A well-run business is always analyzing business processes and finding ways to make them more efficient. It also searches for ways to review, update, change, replace or eliminate its processes on a regular basis in order to keep business activities across departments in alignment with business goals. This process management relies on accessing, monitoring and analyzing a variety of metrics, and consistently training and updating managers.

What Is Business Process Automation (BPA)?

Business process automation (BPA) is the use of technology to assist with or take over manual, repetitive tasks or processes. BPA can generate major efficiency gains, saving the organization time and money, reduce errors, and increase transparency. This automation can take a number of different forms and is something that can drive results for companies across industries and across all departments within those companies. BPA is most effective when it’s executing mundane, repeatable tasks that are not the best use of your employees’ time or skills.

BPA is distinct from business process management (BPM), which refers to a broader effort to regulate company-wide processes, rather than BPA’s more narrow and task-specific workflows that usually happen on a departmental level. BPA falls within BPM, but it is just one piece of that larger puzzle.

Why Is Business Process Automation Important?

The advantages of using BPA are significant and include:

• Reducing costs – For example, by increasing efficiencies and reducing payroll and related costs.
• Increasing process visibility – Budding problems that you can’t see early tend to grow and get more expensive to address later.
• Standardizing processes – Cuts time, effort and money spent on finding information in non-standardized forms and fields; completing tasks, and ensuring compliance with internal requirements and external regulations, among other benefits.
• Improving compliance – For example, human error and inequities are reduced, and every process is completed the same way per compliance rules you set.
• Simplifying processes – It’s common that processes continue for years and even decades only because “that’s how it was always done.” But new technologies and changes in the business or market may require a more agile way of working—simplifying processes can go far in meeting that goal.
• Improving accountability – Accountability is improved through increased visibility and regular reporting, allowing you to see where everything stands and who or what is causing a bottleneck.
• Increasing efficiencies – Automation completes tasks faster and with fewer errors than humans, thus reducing queue waits and error resolutions. Only exceptions need be reviewed by employees.
• Decreasing or eliminating human errors – Automation performs the process the same way every time with no deviations or errors. Just be sure to update the process as needed to ensure it’s performing as needed.
• Keeping process improvement aligned with corporate goals – The common business mantra is to do more with less. By speeding processes, improving efficiencies, reducing errors, improving compliance and reducing costs such as payroll, BPA enables business process improvements that are closely aligned with the corporation’s goals from improving its competitive edge to staying on budget.
• Enabling 24-hour employee- and customer-facing services – Customers and employees often live and work in different time zones. It would be too costly to man a 24/7 office to offer full service in every time zone. Automation is a far more efficient and affordable means of providing service to anyone, anywhere and on their schedule.

BPA does not only help a company avoid adding headcount at the same rate at which it grows but can augment the work of all employees as well. Employee satisfaction tends to rise with the use of BPA. According to a CIO report, “When employees spend more time on the interesting and rewarding aspects of their jobs, productivity and satisfaction rises and—by extension—so does employee retention.”

Evolution of Business Process Automation

Businesses began automating basic business tasks with the advent of material requirements planning (MRP) systems, a precursor to enterprise resource planning (ERP) systems, in the 1960s. Automation efforts expanded as more companies built their own MRP solutions in the ‘70s and they added new capabilities in the ‘80s. BPA took another leap forward in the ‘90s as the first modern ERP systems appeared and quickly became popular with large companies. ERP software offered a central database for an entire business, leading to efficiency gains that stretched beyond just manufacturing, the primary focus of MRP.

Innovation in the years since has led to the development of sophisticated data processing tools and increased automation through technology like robotic process automation (RPA). Today, BPA extends beyond process and integration automation to tools that use machine learning and artificial intelligence (AI).

What Is Robotic Process Automation (RPA)?

Robotic Process Automation (RPA) is a type of automation that relies on user-determined rules to execute a task. RPA will complete a task over and over without making exceptions or becoming smarter over time, like machine learning does. In that sense, it is not a form of “intelligent automation” and is best for basic, repetitive processes. Examples include robots at a factory that help assemble cars, or a rule in your procurement system that flags any order for approval over a certain amount, say $500.

For example, according to Gartner, 89% of general accounting operations and 72% of financial controlling and external reporting can be automated with RPA. And RPA can lead to major benefits —return on investment (ROI) for first-year RPA deployments range between 30% and 200% and are mostly gained from labor savings, according to McKinsey & Company.

BPA vs. RPA

RPA is a type of BPA, but there are several differences between BPA and RPA. For one thing, BPA is automation that augments the efforts of human workers whereas RPA typically does all the work of employees. BPA also cannot adapt to changing circumstances, but RPA can.

BPA can eliminate jobs that mostly entail filling out forms and other repetitive tasks ranging from loan or employee vacation approvals to restocking inventory, but it can’t decide whether to make a change to the process it follows, or a change to the business goal.

RPA is not a souped-up version of BPA. Rather, the primary difference is that BPA usually envisions a complex process, while RPA tackles more simple things that demand time—but shouldn’t.

5 Key Business Process Automation Use Cases

BPA can be applied in a broad range of areas and could improve the efficiency of countless tasks. However, there are some commonalities between use cases that may help identify where to use BPA.

Generally speaking, any process with one or more of the following characteristics is a good use case for BPA:

1. High volume of repetitive tasks
2. High touch processes (usually involving multiple people)
3. Time-sensitive processes (tied to an event, circumstance or deadline)
4. Need for audit trails (compliance, security, audits, etc.)
5. High impact (on other processes, deadlines or departments)

What Business Processes Can Be Automated?

Business processes can be automated according to roles or by specific workflows that are ripe for automation. By simplifying process automation by role, a CEO, CFO, CIO or a line of business manager can more easily automate many of their daily or weekly tasks.

Another way to determine what to automate is related or grouped processes. One example is foundational automation, which is based on best practices a software vendor learns from years of working with businesses in different industries. Other examples include prebuilt reports and pre-configured roles in business intelligence (BI) dashboards and metrics to guide the automation, and intelligent phased implementations which focus on incremental process automations to progress with the least amount of business disruption.

Which Business Functions Can Use BPA?

There are two categories of business functions: core and support. Core functions are the activities that lead to income for the business. These are the primary reason the business exists and hopefully prospers. Support functions are secondary activities that support the core functions.

Many steps in core and support functions, such as call centers, accounts payable, accounts receivable and supply chain management, can be automated with BPA or RPA to increase efficiencies and reduce costs.

Support functions are the activities most likely to be outsourced, insourced or near-sourced by firms looking to focus solely on engaging in activities that produce revenue. Examples include distribution/logistics, marketing & sales, IT and technical services, and administrative duties like HR and payroll. However, many support functions are good use cases for BPA, which can cut or eliminate outsourcing costs in the bargain.

Which Industries Automate Their Business Processes?

Most industries use BPA today to manage things like projects, portfolios, knowledge assets, self-service portals, workflows and data flows. The industries that most heavily use BPA are banking, health care, telecommunications and manufacturing.

Process automation first emerged in the manufacturing sector and is still prominent there today. Manufacturing is also where RPA is in heavy use, as robots are often used in production. But nearly all industries today automate their processes to some degree.

Finance departments routinely deploy RPA to drive greater efficiency, compliance and productivity, per Gartner. The research firm reports “around 80%” of finance leaders are currently using or planning to use RPA. Accounts payable and contract management are two top areas where BPA and RPA are used.

Customer service is another department where BPA is popular. According to research firm Forrester, the customer service industry commonly “uses robotic process automation (RPA) as a tactical and short-term approach to digitize common agent tasks.” Further, Forrester reports companies in other industries that are focused on improving customer experience use BPA to aid in those efforts.

Human resources departments often use process automation to simplify and speed up onboarding and self-service tools for employees, such as enrolling in benefits. Higher education uses BPA to gain efficiencies and improve experiences for students as well as employees. It can manage everything from calls and dorm assignments, to meal plans, to medical services.

Steps to Getting Started in Business Process Automation

While there will be some variation in how BPA is deployed in any one organization, there are some universal steps for getting started. While businesses may decide to deploy BPA across the organization at once, many companies find it easier and more productive to start with automation at the department level. Here are some steps to get started with BPA:

1. Outline and match business goals – Identify and prioritize processes to automate according to how much they will push forward short- and long-term business goals.
2. Start small – Review a process map, perhaps from a BPM system or one your team has developed. Then choose a process that contains a lot of repetitive tasks and has much opportunity for time and cost savings to automate first. Employee onboarding, client onboarding, basic customer support or loyalty program management are all good places to start. The idea is to think big but do the work in small steps. Starting with simpler tasks will also allow your team to gain experience and confidence in deploying automation.
3. Evaluate and select BPA tools – Choose the necessary BPA tools—embedded in ERP or CRM systems or a standalone system like BPMS—according to the automation tasks revealed in your process review and mapping.
4. Look for ways to streamline specific processes – Can things like automated order confirmation emails, marketing automation or automated forms make work faster or easier for your employees?
5. Integrate data and other software – Automatically pull information into the process and make sure the data it is pulling is accurate, complete and relevant.
6. Change management – Get input from affected lines of business to ensure that automation makes sense for their workflows. Secure their active support early on in the automation efforts.
7. Automate – Use the right tools to turn on the automations for the processes you identified and prioritized earlier.
8. Test – Automation will do the right things—or the wrong things—without fail, and repeatedly. Be sure to test automation to ensure it is working as expected and generating the results you want.
9. Get feedback – Reach out to users and lines of business to ensure the automation is helping and not hurtingtheir work and specific tasks.
10. Set up and monitor metrics – Measure automation benefits and effectiveness and tweak the process as needed.

Phases of Business Process Automation

There are four general types of BPA and four general phases. The types are differentiated by complexity and the phases by function. It is common for a company to use BPA in several types and phases, as opposed to a unified state. In other words, individual processes can be in a variety of types and phases.

Benefits of Business Process Automation Tools

Business process automation tools make automating tasks simpler, without the need for manual input, to cut operational costs and efficiently use labor resources. They often include templates your team can follow to automate common processes, adding consistency and simplicity.

Business Process Automation Best Practices

It’s always smart to leverage the lessons learned by those who went before you in deploying any given technology. Here are a few best practices to help you deploy BPA:

1. Think big but start small. Think of the whole rather than the parts you want to automate when you’re developing your strategy. But focus on taking small steps in deploying automation that will steadily move you toward completing the bigger picture in the end.
2. Organize your data. BPA is only as good as the data it runs on, so make sure that your data is clean, complete and not closed off in silos. Be sure to standardize fields and data forms, such as address abbreviations and other variances. Also, eliminate duplicate and out-of-date data. It’s far easier to deal with these issues now than later.
3. Use BPM to streamline your processes first. BPM software is designed to organize and optimize business processes. BPM can also help pinpoint gaps in and between processes that need data access or integration with other processes.
4. Leverage the ERP system. Pull processes and data together across lines of businesses and fill gaps between processes by leveraging the ERP system, which already serves as the central database for your company. You can also access some automation tools within ERP and integrate with Internet of Things (IoT) devices.
5. Aim for continuous improvement. Automation is not a “set it and forget it” exercise. You want BPA to run smoothly and with little to no human intervention. However, you must constantly change to remain competitive. Plan to review your processes and automation regularly to identify what improvements you’ll need to aim for next.

Business Process Automation Examples

Examples of business process automation at work in businesses today are plentiful. But here are six common examples:

1. Automated knowledge assets with chatbots – BPA automates the selection of answers to common questions customers ask the company, making self-service an efficient employee assist tool. BPA used with chatbots reduces the cost of employees in support and HR, since they don’t have to respond to basic, common questions. It can also reduce the time spent searching for documents in customer service or HR, leading to further savings.
2. Automated employee onboarding – Automated onboarding processes can ensure businesses meet compliance requirements around employee-provided identification documents and legal notices employers must give to employees. Additional standard onboarding tasks can be completed using BPA. For example, BPA can push benefit plans to new employees, then deliver a set of options and finally send that person their selected plan documentation.
3. Automated customer support – Customer support agents can instantly access all the necessary customer and product information to more efficiently help customers resolve problems. With chatbots and automated emails, some support issues can be resolved entirely through automation.
4. Automated ledgers – BPA can add data to ledgers and balance sheets to prevent the need for manually adding the same information in each. For example, inventory receipts can be automatically added to the inventory ledger and the asset column on the balance sheet.
5. Automated accounts payable – Once new inventory is received and processed to ensure accuracy and adequate condition, BPA can add the amount to accounts payable and handle the process through to the end payout.
6. Automated employee scheduling – BPA can automate employee scheduling according to projected sales activity, payroll budget cuts, expected seasonal upticks, and market factors such as a major convention in town or a bad weather event, as well as other factors. Further, BPA can notify employees of their schedule and record their presence, absence and performance metrics accordingly.