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Automating business processes with simple rules, cloud ERP

Experts recommend using the tools already built into ERP software -- not overlaying another system -- to achieve simpler processes, improved outcomes and reduced cost.

Most experts agree that, for complex process automation, customizing an ERP system may be more trouble than it's worth. At the same time, overlaying another system on top of the ERP suite can be more than what's needed for the job. There's a third option if the ERP system itself has the tools needed for automating business processes and rules can be set within the suite. According to experts, using these built-in tools to automate simple processes or using cloud-first ERP systems can avoid customization and alleviate concerns about fragility, particularly during upgrades.

Companies' desire to avoid customizing their ERP systems is understandable. Overcustomization can, in some cases, require completely reinstalling the ERP system. To reduce the need for extensive customization, vendors have introduced tools that provide some of the desired capabilities inside their systems, including SAP.

Use existing tools inside ERP software for automating business processes

Process automation tools inside ERP software are not new, and vendors like SAP have had business rule frameworks (BRFs) since 2011, said Julien Delvat, SAP S/4HANA Center of Excellence lead and business transformation mentor at Bluefin Solutions. Currently, SAP offers BRFplus, and Oracle offers Business Rules, for example.

The trend toward digital core, especially with SAP S/4HANA, the newest generation of the vendor's main ERP platform, has led to more process automation using microservices without introducing separate business process management (BPM) tools, Delvat said. For instance, a recent project inside S/4HANA involved automating decision-making processes, like procurement, without a BPM or intelligent BPM overlay. Rules were defined, such as how much a purchase would cost or what category it fell into before it needed manual approval.

Additionally, rudimentary AI features can complete operations like invoice matching, according to Delvat. For example, the organization may need to match bank transactions with invoices sent. In most cases, this is a simple process that involves matching the payment to the date, amount and invoice number. AI helps when customers pay two invoices with one transaction, using machine learning to understand how these invoices are matched with payments, he added.

"What was complicated in the past was maintenance of those rules," Delvat said. "Most of the time, the rules aren't that complicated." One big limitation to automating processes in ERP systems used to be hard-coding the rules, which required a programmer or going through IT, but new offerings from vendors have made it easier for line-of-business (LOB) users to set up and maintain rules.

Automate labor-intensive processes for best results

The best processes for LOB users to automate in the ERP system are the manual, time-consuming ones that don't require a lot of intelligence or review, said David Kennett, sales director at Elevate2, a NetSuite implementation partner. This can include tasks like sending and approving invoices or reporting.

"If you think about the production of management reports, it traditionally can be quite time-consuming," Kennett said. "In reality, it's often the same information that needs to be produced every month." Manipulating the data is what takes time, but by using reporting tools and modern accounting in ERP algorithms, this can be automated and helps in sending reports on schedule.

Keep the rules simple when automating business processes

Much like organizations want to automate simple processes within the ERP system, the rules also need to be kept simple. "Generally speaking, we try to encourage customers to simplify processes as well," Kennett said.

Therefore, when setting up rules, it's important to create a framework first. For example, an expense approval matrix needs to be designed so that it's future-proof and will be able to handle unforeseen use cases without requiring rework, Kennett said.

Automation is best done in cloud-first systems

The best modern cloud systems have a separate layer of customizations that are not impacted by upgrades.
David KennettSales Director, Elevate2

The success of automating processes in the ERP system also depends on the system itself. For many users, the thought of customizing the system may leave them in a cold sweat as they envision a protracted testing period during the next upgrade. However, in a system built for the cloud, workflow and customization won't be affected by upgrades, Kennett noted.

"The best modern cloud systems have a separate layer of customizations that are not impacted by upgrades," he said. While organizations will still want to err on the side of caution and run tests before upgrades, NetSuite, for example, offers a release preview environment that shows what will happen to the customizations.

For simple processes in cloud-first systems, using the built-in ERP tools for automating business processes can be a fast way to save time and avoid difficulties. Existing tools can automate many of the more menial accounting and reconciliation processes, and as long as the rules are kept simple, it should be relatively easy to maintain the system.

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