The performance of a Procurement team is evaluated on the basis of how they are able to drive costs down while consistently delivering better performance value. Which can happen only when a Procurement team can build and sustains relationships with vendor partners – who in turn contribute to cost-effective innovation. This cannot happen without the creation of a strategically sound, sophisticated sourcing model that taps into the capability of people and the efficiency of processes. For vendor procurement organizations, adopting robotic process automation can be a first step on the digital roadmap that helps sustain more complex initiatives further along.

Automation of the Procurement process using a Robotic Solution enables minimisation of time-consuming manual effort that would otherwise add little value and in turn ensures higher levels of efficiency and cost-savings.

Here are a few key reasons why I believe the Procurement process should be automated with Robotic Solutions:

• Ensures standardisation, transparency and process compliance in Procurement function

Policy and process templates can be created and standardised ensuring transparency in terms of compliance and information sharing. Especially in a situation wherein procurement happens at multiple locations from a central organisation hub.

• Enables easy information access for efficiency, negotiation capabilities and cost benefits  

Information from multiple sources can be collated in the form of RFI, RFQ, RFP forms along with supporting documents in a single location, so that analysis can drive informed negotiations for optimum decision making – enabling efficiency of the procurement process.

• Facilitates communication  – reducing operational cost and driving effectiveness.

Document shortcuts that enable circulation will ensure teams view the same documents and are able to track each other’s feedback in real-time, enabling quick evaluation, simplifying the process and preventing confusion and bottlenecks. And thus drive effectiveness in the Procurement function.

Here is a quick overview of how the Procurement process can be automated effectively in terms of Planning & Execution using a Robotic Solution:

• Enterprise Forecasting

Companies undertake a process of periodical demand forecasting which is drawn up annually and is broken right down to a daily forecast number for effective operations. To obtain forecast, Procurement obtains inputs from Marketing, Sales, Production, Administration , Finance etc.

The forecasting collection process can be automated for coordination of collection of information and summarizing and validating the same using a robotic solution.

• Demand Sensing

The task of defining a requirement involves understanding of Demand which is a function of understanding  a business requirement  -which may exist in the form of an idea or description (say a marketing campaign). This is a critical input and can make the difference between success or failure. Demand Sensing and creating a Demand Sensing requisition involves accessing detailed project information and creating a listing of tangible products and services for a work scope document to specify items needed to execute the task at hand. Consensus and approvals amongst internal teams would be the mandatory to complete this step using a Robotic solution on an automated workflow.

• Conduct Financial Reconciliation and Supply Balancing

The Planning process requires past analysis, review of future trends, projections and the business plan. There is need for reconciliation of information from various stakeholders that are part of ascertainment of past performance and future requirements. A Robotic Solution can help in collating data from varied sources, understanding existing supply including sources and performing reconciliation by usage of calculation and simple rule sets and thus assisting in planning.

• Identifying and Sourcing Vendors

An existing database of vendor partners can be your starting point – but Robotic Automation can also work to search out a listing of new vendor partners capable of fulfilling a set of requirements in parallel. Over time – vendor performance data will help keep track of past order history, performance and other details. It can also track pricing inconsistencies; recognizing when volume discounts would be applicable/negotiable and any exceptions that are encoded in the software.

• Information Process for Choosing a Vendor

Automation will enable organisations to track data on past orders in the system to evaluate the most effective suppliers more efficiently and accurately. Suppliers in turn, will be able to respond to bids more quickly, and have easy access to contracts and other information important to the order. The process of creating, completion and submission of standard RFI and RFP / RFQ documents can easily lead to a comparison format that will enable speedy evaluation and selection.

• Creating Purchase Requests & Approvals

Once the forecasting and plan is available and vendors are identified robotic solution can  be  used for extracting information ,collating input for creation of Purchase Requisition.

• Receive and Verify Product, Authorize Payment and ensure Timely and Accurate Processing

Automating processes such as PO creation and issuance with necessary approvals, confirmation of delivery of services satisfactorily received, invoice receipt and payment all within acceptable  time lines for on-time and accurate payments will ensure satisfaction across all levels on both sides. This could only happen via a reliable system of automated inputs and approvals from all stakeholders.

• Manage and Develop Suppliers

A Robotic Solution can help organisations track continuous improvement by performing analysis against benchmarks by usage of calculation and simple rule set  and assisting in improvement of vendor performance.

Thus RPA opens new doors for insourcing by enabling in-house service capabilities and an option to retain all cost savings. It also provides greater control over processes that support a service delivery model.

In order to make all this happen – technology chosen to automate your procurement must be the best-fit for your business to enable efficient purchases, building of relationships and long-term cost savings.  This can be enabled by clear design that creates clear efficient processes and enables achievement of the desired deliverables.