RPA vs. RPAaaS: Streamlining Procure-to-Pay (P2P) Automation – Two Companies, Two Stories

As businesses continue to look for ways to streamline core operations like Procure-to-Pay (P2P), Robotic Process Automation (RPA) has emerged as a game-changing solution. Whether it’s automating purchase orders, invoice matching, or payment processing, RPA can significantly improve efficiency and accuracy in the P2P cycle.

But when it comes to deploying RPA, organizations have two distinct paths to choose from: traditional on-premises RPA or cloud-based RPA as a Service (RPAaaS). Both approaches have their benefits, and the right choice depends on the unique needs and circumstances of the business.

To highlight the differences, let's look at how two mid-sized companies—ABC Limited and XYZ Bank Limited—chose different RPA deployment models to automate their P2P processes. Each company faced unique challenges, and their decisions were shaped by their specific operational environments.

Story 1: ABC Limited – Choosing RPAaaS for P2P Automation

ABC Limited is a mid-sized manufacturing company that operates in a highly competitive, fast-moving market. Like many mid-segment businesses, ABC Limited deals with a high volume of purchase orders, invoices, and supplier payments. Their P2P process was manual and error-prone, leading to delayed payments and strained supplier relationships. With no strict regulatory requirements around data handling, they were looking for a cost-effective, flexible solution to automate these repetitive tasks.

After evaluating their options, ABC Limited decided to deploy RPA as a Service (RPAaaS). Here’s why this approach worked for them:

Why ABC Limited Chose RPAaaS:

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1. Quick Implementation: ABC Limited needed a solution that could be deployed quickly, without heavy IT infrastructure. With RPAaaS, they were able to implement automation within a matter of weeks, focusing immediately on automating critical P2P tasks like purchase order generation and invoice matching.
2. Cost Efficiency: As a mid-sized business, ABC Limited needed a solution that fit their budget. RPAaaS allowed them to avoid large upfront costs like purchasing RPA software licenses or investing in server infrastructure. Instead, they paid only for the automation services they used, allowing them to scale gradually as their needs grew.
3. Scalability: ABC Limited's procurement needs fluctuate based on market demand. With RPAaaS, they had the flexibility to scale automation up or down, depending on their purchase order and invoice volume. During peak periods, the RPAaaS model allowed them to process a higher volume of transactions without the need for additional infrastructure investment.
4. No Maintenance Burden: ABC Limited’s IT resources were already stretched thin. With RPAaaS, they didn’t need to worry about maintaining or upgrading the automation platform—everything was handled by the service provider, leaving them free to focus on optimizing their business processes.

RPAaaS in Action at ABC Limited:

ABC Limited started with automating their invoice matching process. Previously, this task was manual and time-consuming, involving several back-and-forths between the procurement and finance teams. With RPAaaS, bots now automatically match invoices with purchase orders and delivery receipts, flagging any discrepancies for human review. The speed and accuracy of the bots have reduced payment cycle times by 30%, and supplier satisfaction has improved as payments are made more consistently.

By opting for RPAaaS, ABC Limited was able to reduce operational costs, increase procurement efficiency, and scale their automation efforts in line with their business growth—all without the need for significant upfront investment or additional IT resources.

Story 2: XYZ Bank Limited – Opting for On-Premises RPA in a Highly Regulated Environment

XYZ Bank Limited is a mid-sized financial institution operating in a heavily regulated industry. For XYZ Bank, data security and compliance with financial regulations were of paramount importance. Their P2P process was complex, involving multiple levels of approval for purchase orders, strict vendor vetting, and handling of sensitive financial information. After reviewing their options, XYZ Bank chose to deploy on-premises RPA for their P2P automation.

Why XYZ Bank Chose On-Premises RPA:

1. Data Security and Compliance: As a financial institution, XYZ Bank Limited deals with highly sensitive financial data. Regulatory bodies like the Financial Conduct Authority (FCA) and Data Protection Acts require that all financial information be stored and managed within their own secured infrastructure. On-premises RPA ensured that all data remained within the bank’s firewalls, reducing the risk of data breaches and ensuring compliance with strict industry regulations.
2. Customization for Complex P2P Workflows: XYZ Bank's P2P process involved handling complex approvals, multiple compliance checks, and vendor management protocols. On-premises RPA provided the flexibility to customize the bots to handle these intricate workflows, including multi-level invoice approvals and ensuring compliance with internal financial controls. This level of customization was essential for the bank to maintain operational accuracy while meeting regulatory requirements.
3. Long-Term Cost Benefits: While the initial setup cost for on-premises RPA was higher—requiring investment in software, infrastructure, and IT personnel—XYZ Bank saw this as a long-term investment. With their high volume of P2P transactions and complex workflows, the cost per automation would decrease over time, making on-premises RPA more cost-effective in the long run compared to a subscription-based model.
4. Control Over Automation: By keeping their RPA in-house, XYZ Bank retained full control over how their automation was deployed and managed. This meant they could control the timing of updates, the allocation of resources, and the prioritization of critical tasks—all critical factors in a highly regulated environment where disruptions to core financial processes could lead to regulatory penalties.

On-Premises RPA in Action at XYZ Bank:

One of the key areas where XYZ Bank applied on-premises RPA was in vendor invoice approvals. Given the strict compliance requirements for vendor payments in the banking industry, each invoice had to pass through several approval layers. With on-premises RPA, the bank’s bots were customized to automate the initial stages of this process, validating invoices against POs, ensuring vendor compliance, and sending invoices for approval only when all criteria were met.

This automation reduced manual effort by 40%, while ensuring full compliance with both internal policies and external regulatory requirements. As a result, XYZ Bank significantly improved its P2P cycle times without compromising on security or compliance.

RPA vs. RPAaaS: What We Learned from ABC Limited and XYZ Bank

The stories of ABC Limited and XYZ Bank Limited illustrate how the choice between RPA and RPAaaS can be driven by an organization’s unique needs:

• ABC Limited, as a mid-sized manufacturer, prioritized speed, flexibility, and cost-effectiveness in their automation journey. With no stringent regulatory constraints, RPAaaS allowed them to quickly deploy automation in their P2P process with minimal upfront investment and ongoing IT burden.
• XYZ Bank Limited, on the other hand, operated in a highly regulated industry where data security and compliance were critical. They opted for on-premises RPA to retain control over their sensitive data and to ensure that their complex, compliance-driven P2P workflows were fully customized to meet regulatory requirements.

Conclusion

Both RPA and RPAaaS provide valuable solutions for automating the Procure-to-Pay (P2P) process, but the choice depends on your company’s specific priorities. If your business operates in a less regulated industry and needs quick, scalable automation with minimal upfront costs, RPAaaS might be the right fit. On the other hand, if data security, control, and long-term customization are your primary concerns, an on-premises RPA solution may offer more value.

By understanding your organization’s unique needs and weighing the benefits and challenges of each approach, you can make an informed decision that will drive efficiency and success in your P2P operations.