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Emerging Technology: Robotic Process Automation in International Trade

By Karen Lynch

Burdensome paperwork is a chronic condition in international trade. But the digitization of trade finance, customs, supply chains, and other key facets of import-export trade is progressing. As it does, observers see growing promise that a technology known as robotic process automation (RPA) can help cut the time and expense involved in international trade documentation.

What is Robotic Process Automation (RPA)?

 

RPA automates otherwise manual, repetitive, rules-based data collection and input functions. With RPA, a new layer of software interacts directly with an existing business application, mimicking a human user of the application but able to handle higher volumes of structured data.1 As described by the Deloitte professional services firm, "By interacting with applications just as a human would, software robots can open email attachments, complete e-forms, record and re-key data, and perform other tasks."2

 

Though RPA started as the province of large enterprises, for small and midsized enterprises (SMEs) it's considered a good alternative to installing larger, more expensive IT systems, especially given the advent of RPA "software-as-a-service" (SaaS) delivered via cloud networks. "RPA is no longer the preserve of large enterprises; as part of software-as-a-service offerings, RPA is now affordable for SMEs," according to an interview with an SME CEO who is both a user and a vendor of RPA SaaS.3

 

Emerging ‘Cognitive' RPA Can Aid International Trade

 

In addition, while a basic form of RPA is most prevalent today, technology is evolving to provide more "intelligent" or "cognitive" automation, which could begin ramping up in late 2018, according to Leslie Willcocks, a professor at the London School of Economics. In an international trade-relevant example of cognitive RPA, Deloitte described how a global company now handles 7 million annual faxes from clients – converting document images into machine-readable text using optical character recognition, then extracting data and categorizing the faxes using rules and machine learning capabilities.

 

Benefits can include cost savings; better throughput, speed, consistency, accuracy, and efficiency; and improved regulatory compliance, Willcox said, with ultimate benefits for customer, supplier, and regulator relations. While cost savings can come in the form of reduced headcount, RPA can also be seen in a complementary role, freeing some employees from mundane tasks to do more analytical work. The basic RPA market is projected by the Forrester market research company to grow to $2.9 billion in 2021, from $250 million in 2016.4

 

A recent World Economic Forum (WEF) white paper on "Trade Tech – A New Age for Trade and Supply Chain Finance" pointed to RPA as a "no-regret move" that companies in international trade can take in the next couple of years to improve performance.5 Another report, from the Accenture consulting firm, projected that RPA will ultimately increase the automation level of logistics companies' transport planning and customer invoicing to 100 percent.6

 

Documenting Import-Export Trade

 

Consider a case study cited in the WEF report, in which a shipment of flowers from Kenya to the Netherlands generated nearly 200 trade documents. International traders routinely shuffle customs declarations, applications for import-export permits, certificates of origin, and trading invoices – and that's just to cross a single border.7 Trade finance documentation, transport planning, customer invoice processing, and other essential steps also generate paperwork – some of it literally still on paper, handled manually, but much of it being digitized.

 

"Transforming paper-based documentation into electronic formats and applying smart tools and technologies help to reduce trade barriers," the report said. To illustrate potential cost savings, the report estimated the cost of processing and administering all of the international trade documents for the Kenyan flower shipment to be up to one-fifth of the transportation costs.8

 

Singapore, the site of one of the world's busiest ports, is considered an innovator in digitizing and automating international trade. Early in 2018, the Maritime and Port Authority of Singapore announced agreements with the customs authority and Singapore Shipping Association to develop an electronic bill of lading and an RPA tool for shipping agencies.9

 

In international trade finance, "progress toward digitization is gaining momentum with government-level support, as well as growing adoption of digital solutions," according to DBS, a Singapore financial services company. Today, "commonly used trade financing instruments such as letters of credit or documentary collection require a high volume of paperwork and entail complex manual processes, resulting in higher cost, operational inefficiency, and risks," DBS said. DBS has begun implementing RPA to automate some of these tasks and deliver shorter processing turnaround time for trade finance clients.10

 

In global supply chains, RPA is a top emerging trend in 2018, according to Anant Kadiyala, Oracle Director of Blockchain and IoT Industry Solutions.11 RPA can automate order processing and payments; emails confirming order processing, shipments, and delays; and procurement and inventory management.12

 

Across the business world today, "there are countless stories of low-hanging fruit being picked at large multinational companies," according to Anthony Ryan, who leads the RPA Center of Excellence at Eir Group plc, an Irish telephone company. For SMEs' business case, "the analysis and application need to be a lot more granular and explicit about avenues of costs savings beyond headcount reductions," he said, citing provisioning and billing savings directly tied to improvements in internal processes and customer service.13

 

For all the benefits international traders could derive from RPA, however, "in many ways, trade is the hard nut to crack, especially for intelligent data capture, due to the nature of the documents involved and the high requirements for accuracy," said Kitt Carswell, Vice President at CGI, a global information technology consulting company.14

 

The

Takeaway:

As international trade becomes increasingly paperless, RPA can automate many routine tasks, making import-export trade more efficient. And as RPA matures, it is increasingly within reach of SMEs as well as larger companies.

Karen Lynch - The Author

The Author

Karen Lynch

Karen Lynch is a journalist who has covered global business, technology and policy in New York, Paris and Washington, DC, for more than 30 years. Karen also is a principal at Content Marketing Partners.

Sources

1. “An Introduction to Robotic Process Automation,” Wall Street Journal;http://deloitte.wsj.com/cio/2016/03/13/an-introduction-to-robotic-process-automation/
2. “Robotic Process Automation: A Path to the Cognitive Enterprise,” Deloitte; https://www2.deloitte.com/insights/us/en/focus/signals-for-strategists/cognitive-enterprise-robotic-process-automation.html
3. “How Can RPA Technology Benefit the SME?” Information Age;http://www.information-age.com/exclusive-can-rpa-technology-benefit-sme-123470764/
4. “The RPA Market Will Reach $2.9 Billion by 2021,” Forrester; https://www.forrester.com/report/The+RPA+Market+Will+Reach+29+Billion+By+2021/-/E-RES137229
5. “Trade Tech – A New Age for Trade and Supply Chain Finance,” World Economic Forum; http://www.bain.com/Images/WEF_White_Paper_Trade_Tech.pdf
6. Digital Disruption in Freight and Logistics: Ready to Roll? Accenture; https://www.accenture.com/t20170630T071916__w__/us-en/_acnmedia/PDF-53/Accenture-Digital-Disruption-Freight-Logistics.pdf
7. “Trade Tech – A New Age for Trade and Supply Chain Finance,” World Economic Forum; http://www.bain.com/Images/WEF_White_Paper_Trade_Tech.pdf
8. Ibid.
9. “Singapore Sets Out Ambitious Innovation Plan to Grow Maritime Sector’s Value-add by $3.4bn,” Seatrade Maritime News;http://www.seatrade-maritime.com/news/asia/singapore-sets-out-ambitious-innovation-plan-to-grow-maritime-sector-s-value-add-by-3-4bn.html
10. “The Digital Journey in Trade Finance,” DBS; https://www.dbs.com.sg/iwov-resources/forms/sgcorp/en/wc-articles/digital-trade-infographic.pdf
11. “Top Emerging Trend in 2018 for the Supply Chain,” Manufacturing Business Technology Magazine;https://www.mbtmag.com/blog/2018/02/top-emerging-trends-2018-supply-chain
12. “How RPA Impacts the Global Supply Chain,” UiPath; https://www.uipath.com/blog/how-rpa-impacts-the-global-supply-chain
13. “Robotic Process Automation & the SMB Challenge,” Disruption hub; https://disruptionhub.com/robotic-process-automation-smb-challenge/
14. “Talking Trade Tech,” TXF; https://www.txfnews.com/News/Article/6359/Talking-trade-tech

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