How IBM is leveraging the power of RPA to speed up its procure to pay process

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Key Points:

  • IBM Procurement implemented RPA to automate a blocked invoice payment process that often required intensive manual intervention
  • IBM was able to reduce manual intervention by 95 percent, and our blocked invoice resolution time has fallen from 32 minutes per invoice to 90 seconds per invoice
  • Existing process experts were shifted to focus on value-add activities and the robot-managed process has been virtually error-free

Recognizing an opportunity to use RPA

Invoice referrals factor into a critical risk assessment metric for any organization. Procurement professionals need to ensure that suppliers are paid on time. But the invoice payment process involves a lot of manual reconciliation and communication between teams. It’s been a common practice to measure aged invoice referrals manually. This manual process required a significant amount of time to unblock the invoices for payment processing. Knowing that invoice payment process is critical and sensitive, IBM Procurement realized that implementing a robotic process automation (RPA) solution was a top priority.

IBM Procurement was integral to identifying opportunities for innovation and creating RPA solutions to automate high-volume repetitive tasks related to procurement operations that formerly required significant manual effort. IBM’s blocked invoice process management solution is an example of automating a series of manual tasks to save time and effort, improve processing quality and avoid risk.

Justifying the need

IBM Procurement manages billion-dollar transactions spend with thousands of global suppliers annually. These transactions generate around two million invoices annually. It’s imperative that these supplier invoices are processed and paid promptly. The invoices are received and paid electronically; however, there are situations when invoices are blocked from being paid due to discrepancies between the invoice and the related purchase order. Eliminating these process blocks requires intensive manual intervention, which delays invoice processing.

Implementing the RPA solution

IBM Procurement automated its blocked invoice process by implementing a Blue Prism RPA solution. To prepare for the solution, IBM completed a motion study for each step of the process to gain the insights required to design the most viable solution to drive stakeholder value, efficiency and productivity.  There were three steps to this implementation:

1. Design process maps in IBM Blueworks Live (for both “as is” and “to be” processes)

2. Create three proofs of concept (POCs):

  • POC 1 involved blending a web-based solution, supported by a WinAuto Software bot
  • POC 2 involved using an Open Span Pega Software BOT with a web-based dashboard
  • POC 3 involved an inventory of codes that was easily migrated to a Blue Prism software bot supported by an IBM Watson-based dashboard

3. Create a bot that will automatically identify price or quantity mismatch/exceptions by reason codes and provide buyers with a next best action to support and resolve open invoices

Realizing the benefits

Working with Blue Prism RPA, IBM Procurement automated the blocked invoice process, resulting in a wealth of benefits:

  • After automation, fewer than 10 percent of blocked invoices require manual intervention, allowing buyers to focus on higher-value tasks
  • 95 percent of blocked referrals are now managed by bot
  • Automated validations help to avoid risk
  • Actions recorded and logged are traceable, with real-time resolution and analytics
  • Automation allows for a 24-hour productivity window
  • Faster processing improves turnaround time
  • Higher quality processing helps ensure “first time right”

Enjoying the results

Since implementing the RPA solution we have reduced manual intervention by 95 percent, and our blocked invoice resolution time has fallen from 32 minutes per invoice to 90 seconds per invoice.2 This provides better control, improved quality and increased traceability. For IBM, its RPA solution represents a true optimization of the end-to-end transaction: existing process experts were shifted to focus on value-add activities and the robot-managed process has been virtually error-free.

1, 2 Source: Based on IBM internal analysis.

Learn more about where to start and how to implement RPA for your organization.

Vice President, Supply Chain & Chief Procurement Officer

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