User mindset, not tech, challenge S'pore biz automation

Technology isn't the barrier to increasing business process automation. Instead, many Singapore businesses face difficulties instigating change within the organization and lack well-defined processes.
Written by Ellyne Phneah, Contributor
Challenges with process automation have more to do with a company's appetite for change, rather than technology.

When it comes to automating business processes, Singapore companies do not face challenges related to technology. Instead, they lack well-defined processes, fail to establish collective agreement on what should be automated, and neglect the need for proper change management to facilitate increased automation.

Businesses in the country have focused automation on backoffice systems to manage their supply chain or leveraged technology to automate processes in manufacturing such as a factory force, observed Michael Barnes, vice president and research director at Forrester Research.

ICT also has helped improve business productivity by eliminating as much of the non value-added work and automating the controlling activities as much as possible, Brett Hall, head of management consulting at KPMG Singapore, pointed out.

Barnes noted organizations can further tap both data and technology to automate and optimize its processes, or redefine business processes. An insurance firm, for instance, can automate processes involving claims or underwriting, he said.

The Singapore government has been focusing its efforts on productivity, providing incentives to encourage local organizations to raise staff efficiency. During its recent budget announcement, for instance, it added a new bonus for participating companies of the Productivity and Innovation Credit scheme.  

Hitachi Data Systems (HDS) is one organization that recently re-engineered its internal inventory structure because its previous processes were time-consuming as the system logged information tailored to the inventory of each HDS customer. This resulted in a lot of data being required before shipments could be packed or distributed, explained Luke Teo, director of HDS' Asia-Pacific Distribution Center (ADC).

"It is through the re-organization process, the still stringent but less restrictive process, that allowed us to improve productivity and move popular products like Hitachi Unified Storage and Hitachi Virtual Storage Platform faster than before," Teo said.

Challenges lie with organizational change

But while technology already exists to help automate business processes, Singapore organizations are challenged by other deployment issues.  

These difficulties have little to do with technology and more to do with the organization's appetite for change, process design, and the degree of common understanding on what will be delivered from any such initiatives, Hall pointed out.

A classic example is how people still print documents to read and edit them in hard copy, defeating the purpose for workflow automation software.
- Brett Hall, KPMG Singapore

Barnes noted that process automation is hassle-free only when it is well-defined and agreed upon by key stakeholders in the organization. These, he added, are lacking in many companies today.

The challenge lies in establishing internal agreement among stakeholders on the process, as well as how to go about closing the gap between what it is and what it should be, explained the Forrester analyst. "Everything else is not a technology problem, but a collaboration problem," he said.

Brett added that business process automation, if not effectively designed, can further exacerbate the symptoms of a poorly designed process. When a company tries to improve a process in a localized manner, it merely shifts the problems from one department to the other, he noted.

Proper change management, which should include staff training and changes in user behavior, is also necessary to ensure alignment with the new processes, Hall noted, adding this is almost always neglected or "becomes the victim of a project budget cut".

"A classic example is how people still print documents to read and edit them in hard copy, defeating the purpose for workflow automation software," he said.

While there typically are concerns over job losses due to automation and reducing process-driven tasks, Barnes noted this was not an issue for companies in the country. Singapore, in its current state of development, is more focused on optimizing, improving, and extending processes, rather than a desire to automate processes or eliminate jobs, he said.

Understand processes, facilitate training

Moving forward, companies should take the time to understand what processes and activities create value for their customers, Hall said. Parts of processes that do not add value, but take up a lot of manpower, should be identified, he advised.

For example, to devise ways to improve efficiency, companies should follow a process--such as a customer order--from start to finish and across the organization, so they can identify the bottlenecks, he explained.

Businesses should also look at why processes exist, before redesigning them from scratch to determine how the improved processes would work, Hall added. A reality test should then be applied to see whether the re-engineered process is possible in the organization, given real-world constraints of budget, time, and resources, he said.

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