Robotic Process Automation (RPA) is a business process automation technology based on software robots (bots) or artificial intelligence (AI)/digital workers. RPA is software module robots, in contrast to hardware robots used in manufacturing production lines or warehouse pick-and-place tasks. RPA is often used to automate repetitive manual processes.
In traditional workflow automation, a software developer codes a list of actions to automate and interface to back end system using application programming interfaces (APIs) or dedicated scripting language. RPA systems, in contrast, create the action list by watching the user perform tasks in the application’s graphical user interface (GUI) and automate by repeating those tasks directly in the GUI.
An enterprise business process can be operated by numerous bots. For example, a simple order fulfillment process may use multiple bots to automate various order sub-processes. However, as the number of deployed bots increases, the management of the bots, their synchronization with the central controller, and maintenance, is a major challenge. In essence, “how do we manage the bots?”
In this brief whitepaper, we address Robotic Process Automation Management (RPAM) in the 3PL industry. That is, why is RPAM critical for the life-cycle management of the bots and their environment, and how it can reduce the total cost of ownership and elevate operating margins by reducing operating and maintenance costs. But first, we briefly describe 3PL.
What is 3PL?
3PL is an abbreviation for third-party logistics. This includes a variety of services for the fulfillment of customer-ordered goods. 3PL is often used interchangeably with fulfillment warehouse or fulfillment center terminologies. 3PL services typically include:
• Inventory management
• Shipping and receiving
• Full truckload (FTL) and Less than truckload (LTL) freight shipping
• Picking and packing
• Kitting and customization
• Reverse logistics (returns)
A third-party logistics company can also act as an eCommerce fulfillment company. Thus 3PLs, provide all the services necessary to outsource logistics operations for product delivery.
According to a white paper by the World Economic Forum and Accenture, the digital transformation in the field of logistics is expected to result in a $1.5 trillion value at stake by 2025.
Any 3PL service will require a series of processes to accomplish fulfillment. For example, the process for responding to a new loading and pricing request for shipment. This involves opening an email attachment with request details of the load, shipment date requirements, and others. This also requires identifying available carriers in the area, carrier load pricing, calculating the total cost, shipment schedule, etc. This takes about 5 minutes, at a minimum. for a human to complete. A robot can complete this process in less than a minute. Another example is product delivery ordered from an eCommerce site. The manual process would be to retrieve the order information, locate the product in the warehouse, pack, label, move to the shipping area, create a shipping manifest, and place the package in the outbound area for shipment. This process can be automated with RPA.
RPA in 3PL
There are various areas in Transportation and Logistics using RPA. Auto-tracking of goods results in fewer customer calls checking in for delivery status. RPA enables freight re-routing to the best fulfillment center, automated reporting and feedback to drivers, and efficient inventory management across the supply chain.
One report cites eight case studies of benefits from RPA in 3PL. These include, among others, shipment scheduling and tracking, invoice processing, inventory processing, and effective communication.
Thus, while it is evident that RPA is in wide usage in 3PL with numerous bots deployed to automate many processes, what is not evident is viewing RPAM as a strategic total cost of ownership enabler. The industry has yet to realize and embrace that RPAM can act as an intermediary between bot orchestration and bot deployment environments, to manage bot operations, and proactively prevent bot failures. Bots do fail to require expensive human intervention. An effective RPAM strategy is a crucial lever for bot life-cycle management cost improvements. On average, maintaining and servicing “8 to 16 bots requires 1 FTE annually. This equates to between 130 to 260 hours of annual manual support per bot”, according to Reza Asgari, CEO, ChoiceWORX.
Why RPA Management (RPAM) in 3PL?
It is evident from the above that organizations with many deployed RPA bots potentially require significant human support. But more critically, how are these bots managed to ensure that they are operating as they should, and any dependency changes, such as RPA software, infrastructure, cloud/virtual environment updates, or end-user device changes, do not result in operational failures? After all, the more the number of operational bots, the larger will be the number of failures, leading to larger service issues, increased operational costs, and poor customer satisfaction. RPAM avoids just that and ensures that bots function as expected while continuously monitoring the environment.
Since bots operate with multiple dependencies (applications, devices, networks, infrastructure), repairing a bot will require skills in these domains. The more the number of operational bots the larger the staff size, skill breadth, and capacity required. Companies also often use multiple bot vendors which further increases support costs due to bot diversity.
Intelligent and automated bot support is the only solution to reducing the life-cycle total cost of RPA ownership. An RPAM environment effectively and efficiently manages the complexity of large-scale bot deployments by monitoring, measuring, and maintaining bots while proactively remediating failures. RPAM environments should also be designed with a controller to act as an intermediary between the RPA software orchestrator in the cloud and the operational bots. In this capacity, RPAM should observe the inter-dependencies between the orchestrator and the bots, and oversee any impending failures due to software upgrades, container re-distributing, scheduling changes, and other site-specific (hybrid, on-premise, or cloud) variations. With proactive reporting and appropriate alerts, it engages high-value human resources only when needed.
Conclusions: This white-paper reviewed RPA use in the 3PL industry. It is evident that RPA yields significant operational and customer experience benefits. It is also clear that as organizations automate more functions with bots from multiple vendors, bot maintenance costs will also proportionally increase, with skill requirements being at a premium. Intelligent and automated RPAM is the only solution to this problem. It is a win-win-win for all – the customer, the employees, and the organization.
About the author-
Shubho Chatterjee: Shubho Chatterjee is a growth-driven Digital Executive & change agent proven in delivering sustainable growth, operating margin, & shareholder value. He is a visionary servant leader, strategic thinker, and craftsman of user-centric, high-performance transformational solutions yielding multi-billion $ returns. He is adept in managing P&Ls, turnarounds, risks, governance, & M&As. An articulate, effective communicator & influencer, Shubho holds a Ph.D. in Engineering.
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