how to build a business case for automation

OmPrompt

How to Build a Business Case for Automation

2| OmPrompt - How to Build a Business Case for Automation

Are you confident that you can build a business case?

While most organisations today (96%) are required

to produce some form of case when seeking

approval for IT spend our research indicates that few organisations are satisfied with their ability produce

such a case.

– Ward, Daniel & Peppard, Cranfield Universityhttp://www.som.cranfield.ac.uk/som/dinamic-content/research/documents/ward_cmr2007.pdf


The Time for Automation is Now. According to Deloitte, 43% of mid-size American businesses are likely to invest in automation technology in 2016.* It’s much more than a passing trend, because the most successful companies are embracing automation.

You already know this. You’re sure that automation is the way forward for your own organisation.

In fact, you’re convinced that many of the problems affecting your business today could be avoided completely if you automated your order-to-cash process.

And you’d be right.

All you need to do is nudge your CEO in the right direction and wait for him to give approval.

Problems solved, future of company saved and maybe a promotion for you.

Wrong.

Start preparing your business case today

* 2015 report on America’s Economic Engine. - Deloitte.


These gatekeepers are part of the senior management team and each oversees a key area of the business:

1. Customer Service or Supply Chain2. Purchasing or Planning and Forecast Demand3. Head of IT or CTO4. COO or Head of Operations5. The Guardian of Profit

Each gatekeeper has their own issues to resolve and is measured on a unique set of KPIs. Win them over and you’ll have a team of strong allies. But you’ll need to form your argument carefully.

The key is to show them how automation can help them win the battles they are fighting within their own department and how it can help them achieve their targets.

Gatekeeper 1: Head of Customer Service

The Five Gatekeepers of the Status Quo

Introducing the Stealth Approach: aka ‘the Business Case’.Your CEO is a busy person. He gets crazy suggestions all the time. And – to him – automation sounds like a lot of extra work. It’s just not a priority right now…

Your challenge is to show that it is a priority. To do this, you need to formalise your ideas and get other senior-level decision makers on your side by putting your argument forward as part of a watertight business case. You’ll need to create a document that shows how automation addresses the key business goals and challenges.


How Order-to-Cash Automation can Help Customer Service:Automation can help her by reducing the burden of the work associated with inputting orders from her employees’ shoulders. She can also redeploy staff, and therefore reduce costs – and use her best people to foster positive customer relationships which can, in turn, increase business. Morale will go up, driving down employee churn. The whole ethos of the department can change and, as fewer errors are made, goods are more likely to be delivered on-time, in-full (OTIF), and pay-outs or fines or claims can be reduced.

Automation allows people to gain knowledge about certain customers, based on their repeated behaviour, and turn this into business rules.

For example, they may type in ‘marathons’ but they actually intend to order snickers bars.

Gatekeeper 1:

Head of Customer Service This gatekeeper is right on the front line. Direct communication with customer service representatives makes her a key influencer. To help her cope, she has an army of foot soldiers (CSRs) who deal with order entry, resolving customer problems, all aspects of relationship management and (all too often) fielding complaints.

Her major battles are the increasing salary costs of the department, unhappy customers and losing good employees; usually due to the often hostile environment and dull, repetitive nature of the work; and, perhaps, having to take on extra work without extra resources.

Gatekeeper 2: Head of Planning and Forecast Demand

A major global wine business used OmPrompt’s Customer Automation Management platform to achieve the perfect order and increase order accuracy from 98% to 99.7%.

In addition to the increase in customer satisfaction, this move saved them €612k per year.

Automation Success:


How Order Automation can Help Improve Supply Chain Management:Automation will help your Head of Planning and Forecast Demand achieve just in time (JIT) inventory management by giving the company visibility of accurate customer orders AND helping with the prediction and intelligent forecasting of future demand. He’ll then be able to reduce the working capital tied up in stock without the risk of running out of materials. It will also help him save money on purchased items. He’ll be able to place more accurate annual orders, which means suppliers can hold less stock on your company’s behalf. And, with near-real-time stock updates he will be able to ensure more accurate stock uptake, which will put him in a strong negotiating position.

Gatekeeper 2:

Head of Planning and Forecast Demand This gatekeeper spends most of his time trying to foresee the future. It’s an almost impossible task as the information he has to work with is often inaccurate. He gets round this by ordering more stock than he actually needs to avoid the most deadly sin of supply chain management: running out of stock and halting production.

Despite his best efforts, he still spends a lot of time trying to get hold of critical items ‘before it’s too late’. He’s also under fire internally because he’s had to overspend in order to bring incoming material deliveries forward and he’s got way too much inventory.

“80% of top performing firms are moving to cloud-based visibility, more event-driven warehouse and transportation management. They provide a customer-connected, single version of the truth; seamless and unified across channels, customers, costs and activities.”

Automation Success:

Source: Aberdeen Group, Jan 2016*

*Source: http://v1.aberdeen.com/launch/report/research_report/11282-RR-event-supply-chain.asp

Gatekeeper 3: COO or Head of Operations


How Order Automation can Help Operations:It all begins with accurate customer order data. Visibility of actual orders and intelligent forecasting leads to efficient capacity planning and lean manufacturing. While most companies can ensure that goods can be produced just in time (JIT) and shipped into waiting vehicles; the key issue here is visibility.

With true visibility of all order-to-cash processes the COO is truly in the driving seat; there’s no need to make extra stock to overcome errors; the company becomes more cash-rich; and operating profit increases.

Gatekeeper 3:

COO or Head of OperationsYou’ll find this gatekeeper deep in the engine room of your organisation, constantly moving everything around to squeeze more out of the system. He’s deeply suspicious of customer service and pushes back as much as he dares. He’s also fiercely protective of his staff, procedures and processes and doesn’t appreciate anyone who tries to circumvent these in order to ship goods ahead of his schedule.

His most burning issues are: ensuring profitability, reducing expenses, delivering goods on time in full (OTIF), lowering the cost to serve customers, as well as ensuring all elements of logistics are working smoothly. Within this, OTIF is a key measurement metric, and the thing that’s the hardest to get right. To stack the odds in his favour he tries to get ahead of the game by making products well before the shipping date, resulting in too much work in progress (WIP) and stock. This antagonises finance — as it reduces available cash — and forecast demand.

Working with a $20bn consumer goods company, OmPrompt used customer automation management to connect the SAP and transport management systems. The company achieved a cost saving of £4.5M in transport costs alone. In addition, they also cut staff costs by a massive 67%.

Automation Success:

Gatekeeper 4: Head of IT or CTO


How Order-to-Cash Automation like OmPrompt can Help IT:The best automation systems integrate with your existing infrastructure as part of a shared partnership, so there’s no need for changes to existing IT infrastructure, or additional investment in infrastructure, as there’s no hardware or software to install or maintain.

Order-to-cash systems, can identify anomalies in master data and either correct them at source or proactively flag them for review. And clean, reliable data leads to accurate and real-time reporting. In addition, the pressures and responsibility for data back-up no longer falls on the IT department, nor do issues relating to compliance.

Streamlined, integrated systems also support (rather than compete with) ERP implementations or upgrades: making full data visibility easier, and keeping internal customers happier - without the workload or pain of massive ERP changes.

Gatekeeper 4:

Head of IT or CTOThe CTO is a tricky gatekeeper because his department interacts with many aspects of the whole business. A lot of what he does is shrouded in mystery and seen as a black art to the rest of the organisation. His perception that automation will be the responsibility of his department will make him your toughest adversary yet.

But, he has challenges of his own that you can use to your advantage: the issue of data. It’s his responsibility to make sure all the sales, financial and shipping systems are accurate and up to date.

Automation Success:OmPrompt can get your first customer live within 5 days and achieve full scale implementation within weeks.

Once the gatekeepers are on your side, they’ll be strong allies.

That’s important as you’ll need them when you come to face with the following senior company members...

Gatekeeper 5: The Guardian of Profit


Gatekeeper 5:

The Guardian of Profit You’ll know him by his more common name: CFO. This is the next section of your business case that you’ll need to craft.

The CFO can often be seen as a barrier to good progress, but that’s a little unfair. He’s measured on the company’s profitability and so he’s only interested in two things: cash and return on investment (ROI).

The business case here is simple: automation helps make you money. All you need to do to bring your CFO on-board is to pitch the benefits of automation in terms he understands.

For example, proof of delivery (POD) comes through more quickly, so you can invoice sooner and reduce your days sales outstanding (DSO) which improves your cash flow. Accurate forecasting will help to drive down costs of goods sold, directly improving the bottom line. And of course he’ll have accurate metrics available at his fingertips about how your company is performing in real-time.

You only have one remaining obstacle to consider...

Achieve Automation Success OmPrompt have enabled many businesses to significantly reduce costs through automation. Here are two examples:

A global dairy company reduced goodwill write-offs by £5.4M per year.

A multinational distribution and outsourcing company reduced cost per order by 64% and headcount by 58%.

Other areas of cost saving include:

• The redeployment (or reduction) of FTEs and/or of staff churn

• The reduction of errors

• The ability to tackle more claims (or, indeed, have fewer of them)

• Less stock write-off

• Reduced days sales outstanding (DSO)

• Increased opportunities for cross-sell and up-sell

• A reduced cost-to-serve

• And ultimately – reduced risk due to increased visibility across the entire order-to-cash supply chain.


The Great Lord and OverseerAlso known as the CEO, everything you’ve already written is going to help him pay attention to you. However there are two additional points to hammer home:

1. Growth: automation will help you realise your strategic goals and satisfy shareholders. It’s scalable and flexible – growing with you, but also allowing you to automate other aspects of your business as time goes by which, in turn, gives you increased control and visibility.

2. Competition: If we don’t do it, someone else will. All of these points provide your business with a competitive advantage. Automation enables you to create a ‘menu card’ of services that you can take with if you decide to acquire new businesses or expand into emerging markets. As a result, you can still serve your customers without the need to hire or re-train existing staff.

At the end of the day, Customer Automation Management enables your company to deliver what your customers need, when they need it.

It really is as simple as it sounds.

Pulling your business case togetherThe great thing about automation is that it’s an easy case to make. The numbers speak for themselves, so you won’t need a huge document. In fact, it’s probably better if you keep it short.

We can help you pull together a brilliant business case for automating any part of your order-to-cash process. But bear in mind that a good business case should also include answers to the following questions:

• Which processes within the order-to-cash cycle do you want to automate?

• How many FTEs do you currently use to handle this/these processes and what’s your average FTE cost?

• How many transactions do you process in this/these process per year?

• How many trading partners (customers) do these documents come from?

• What formats are the transactions in? (e.g. PDF, email, fax, EDI)

• What is the average cost of an error?

• What is your current accuracy rate?

• What is your current cycle time?

• What is your current level of DSO?

• What percentage of orders or transactions result in a claim or fine?

A simple table or bulleted overview of the key areas of your business with projected improvements will be enough to get the attention of senior management and start those internal discussions that will, eventually, lead to change. Just make sure you highlight the metrics that your company is most focused on.

We can help you build the perfect business case for automating any or all of your order-to-cash processes!

You never know, you might get that promotion after all!


• Allows you to scale, get results fast, add customers, and automate even more of your processes, as and when required

• Is secure, available 24/7 and highly scalable

• Is an award-winning, industry-leading technology platform that fully automates your O2C process

• Can be implemented within weeks or days

• Integrates with your existing infrastructure

• Is a pay-per-use solution based in the cloud so everyone in your organisation has

appropriate visibility into orders, shipments, inventory, invoices, and payments

• Supports all EDI formats, such as EDICT, EDIFACT, TRADACOMS, ANSI, email, PDF, fax, AS/2, FTP, HTTP; it also supports all the main ERP, CRM, transport management/planning, and warehouse management systems.

• OmPrompt is a partner not a tool. We work together with you so you not only get a 12-month ROI, you also see added value and benefits accrue over time.

If you’re ready to embrace automation...Get in touch now: +44 (0)1235 436000 or [email protected]

The OmPrompt solution:


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OmPrompt Ltd67 Innovation DriveMilton Park, AbingdonOxfordshire, OX14 4RQUnited Kingdom

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As the pioneer of customer automation management, OmPrompt helps a growing number of the world’s leading brands eliminate gaps in the order-to-cash process that have tradition ally required manual workarounds.

OmPrompt has innovative ways of automating repeti tive manual work in the customer management cycle, enabling clients to free up resources, manage by exception, remove restric tions, and eliminate risks to their businesses.

Our intelligent, cloud-based solutions are delivered as a service, co-exist with EDI-based solutions, are quick to deploy, easy to extend, and offer an exceptionally fast ROI.

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