Robotic Process Automation in Logistics – A Case Study

of a Production Company
Abstract:

Purpose: The purpose of this paper is an analysis of the implementation of robotic process
automation in the logistics processes of a selected production company (case study).
Design/Methodology/Approach: The following research methods were used: desk research
and case study. The results of the research can be used in terms of recommendations for
entrepreneurs in the approach to implementing the RPA concept, and thus improving the
functioning of the organization.
Findings: The results of the research can be used in terms of recommendations for
entrepreneurs in the approach to implementing the RPA concept, and thus improving the
functioning of the organization. The term Robotic Process Automation (RPA) appeared
relatively recently, but the phenomenon itself has been around for a long time.
Practical Implications: Logistics processes, and in particular the costs related to their
implementation, are an important element of the economic process. Automation of logistics
processes related to logistics processes, and even entire production lines, is becoming a
global trend. At the same time, the implementation of this type of improvements and
innovations can be carried out in virtually any organization, regardless of the industry and
scale of activity. Based on the case study, it was shown that the robotic automation of
processes in the logistics of the tested production company contributed to the reduction of
the total costs of the entity by about 10%.
Originality/Value: The added value of the article is related to tracing the effects of RPA
application in the field of logistics processes of a production company - thanks to which it is
possible to indicate benefits in the case of a relatively small scale of activity (entity from the
SME sector).

Keywords: Robotic process automation, digitization of logistics management, RPA in

logistics, implementation of RPA in logistics.

Acknowledgement: This article is co-financed by the European Union under the Operational
Programme Knowledge, Education, Development 2014-2020 within the realization of “The
Integrated Programme of Poznan School of Logistics”
 1. Introduction

Logistics processes, and in particular the costs related to their implementation, are an
important element of the economic process. Automation of logistics processes related
to the transport of items, manipulation, palletization and depalletization as well as the
introduction of robotic workstations, and even entire production lines, is becoming a
global trend. Manual performance of simple and repetitive activities is no longer
profitable for the company, which is why the work of robots and automatic machines
begins to displace manual labor. But even in the era of such intense industrial
development, robots are not able to completely replace humans. New applications are
systematically created that enable the integration and cooperation of the machine with
humans.

The development of technology and the implementation of modern solutions in the

field of robotization of production and logistics processes generate a number of
benefits. Robotization of production and logistics processes in the world and in Poland
is characterized by an upward trend. Unfortunately, it does not develop as dynamically
in Poland as it does in the world. Poland is one of the least robotized countries in the
world in the group of industrialized countries. Although the interest in robots in Poland
is growing, the awareness of entrepreneurs about their possibilities and benefits
resulting from their use is still low.

The aim of the article is to analyze the implementation of robotic automation in the
logistics processes of a selected production company (case study).

2. Robotic Automation of Processes in Logistics

There are many technological solutions on which modern and innovative logistics
processes in the organization are based. Currently, we can talk about a significant
dynamization of broadly understood digitization. There are many reasons for this - you
can talk about trends and concepts such as Industry 4.0, the globalization of the
economy, as well as the effects of the COVID-19 pandemic.

Therefore, it can be indicated that in the near future there will be a focus on the wider
use of artificial intelligence, robotization, automation, which will partially or
completely replace human work (Boyes, 2015; Sherman and Chauhan, 2016; Bock,
Iansiti, and Lakhani, 2017; Ocicka, 2017; Adamczewski, 2018; Nahavanki, 2019;
Salimova, Guskova, Krakovskaya, and Sirota, 2019; Aslam, Aimin, and Rehman,
2020; Longo, Padovano, and Umbrello, 2020; Frederico, 2021; Vogt, 2021).

Automation is increasingly used in logistics. In recent years, the ratio of the total cost
of owning robots to the benefits they bring has changed radically. In this context, the
Robotic Process Automation (RPA) technology has a special implementation potential
in organizations. It is based on the automation of repetitive business processes with the
use of computer programs (robots).
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A business process is a set of activities that are measurable, based on clear rules,
followed by a specific sequence and designed to deliver a specific result. A robot, on
the other hand, is software that automates specific activities performed by a human
(faithfully reproducing them at the user interface level or in the background) during
the implementation of a given business process. The effectiveness and benefits of
implementing the robot can be considered in various aspects. Assessment criteria
should be developed separately for each project (Aguirre, Santiago, Rodriguez, and
Alejandro, 2017; Anagnoste and Sorin 2018; Kedziora and Kiviranta, 2018; Rajesh,
Ramesh, and Rao 2018).

At the same time, it is worth mentioning that in many companies RPA also contributes
to the standardization and optimization of business processes. This solution is quickly
available, as the robot implementation time is about a month on average. When
choosing RPA, there is usually no need to significantly interfere with the existing IT
infrastructure, which in turn reduces costs. Above all, however, RPA in the aspect of
enterprise logistics is an important element of building a competitive advantage,
offering customers value-added services, building competences and a culture of
automation in the enterprise (Willcocks, Lacity, and Craig, 2015; Vilminko-Heikkinen
and Pekkola, 2017; Willcocks, Lacity, and Craig, 2017; van der Aalst, Wil, Bichler,
and Heinzl, 2018; Sibalija, Jovanović, and Đurić, 2019).

Benefits resulting from the automation of logistics processes (Szatkowski, 2016;

Jankowska and Łukasiak, 2017; Martinek-Januszewska, 2018; Kaczmarski, 2020):

• Efficiency: saving time and / or money, reducing operating costs, reducing

employment.
• Quality: improvement of the quality of implemented processes, data
correctness control, elimination of errors.
• Organization of work: work would not be possible without these solutions
(the ability to achieve the goals of the organization), standardization and
systematization of work, shortening and facilitating processes, as well as
better control of their course, reducing risk at high volume, company
development, devoting time to important things.
• Competitiveness: quick reaction to the actions of the competition, making
the offer and products more attractive; potentially increased
competitiveness, better customer service.
• Employees: one stony load reduction for the team, requires less - present
knowledge of the workers serving automation, on the other hand, better
knowledge of experts and the possibility of better talent management, the
ability to use automation to develop their career (through active
participation in improvements).

In addition, robotic process automation technology relies on continuous

improvement techniques to identify new processes that are eligible for robotization
and improve performance by learning from mistakes. Thanks to this, it is
systematically possible to increase its use in the logistics of the organization.

2. Research Methodology

Detailed description of the cyclic delivery synchronization problem was presented in

the previous works of the authors (Gdowska and Książek, 2013; Gdowska and
Książek, 2015).

The aim of the research in this article is to analyze the implementation of robotic
automation in logistics processes of a selected production company (case study). On
this basis the following research problems were formulated:

• What are the possibilities of using RPA in the logistics of manufacturing

company from the SME sector?
• What are the benefits of RPA implementation in the logistics of the selected
company?

The following research methods were used, desk research and case study. The desk
research method consists in compiling, analyzing and processing data and
information from existing sources, and then formulating conclusions on the problem
under investigation (Makowska, 2013; Bednarowska, 2015).

Case study, analysis of a single case, i.e., a detailed description of a usually real
case, allowing to draw conclusions as to the causes and results of its course and the
broader business model, market characteristics, technical, cultural, social conditions,
etc. on a case-by case basis. The case method offers the possibility of an in-depth
problem analysis (as opposed to quantitative methods). It has stringent requirements
but allows for considerable flexibility, especially when it comes to an unusual
research problem. There are specific rules for study design, data acquisition and
analysis, and results presentation (Langley, 1999, pp. 691-710).

The selected Enterprise X2, which produces and trades corrugated board and
cardboard packaging, was analyzed in this article. The results of own research are
included in the next section.

3. Research Methodology

3.1 Enterprise Description

The analysis in this article will cover Enterprise X, which deals with the production
and trade of corrugated board and cardboard packaging. It produces packaging made

2
The owner of the enterprise did not consent for the company name to be used.
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of 2, 3 and 5-layer cardboard with various combinations of C, B, E waves, as well as

flap packaging, otherwise known as FEFCO201, and shaped packaging.

According to the Polish Classification of Activities (PKD), it is Section C, Division

17.21.Z - Production of corrugated paper and corrugated cardboard as well as paper
and cardboard packaging, SIC CODE: 51119902 - Paper for printing, 51130304 -
Crinkled and uniform box packaging (PKD, 2020).

As a result of the COVID-19 pandemic, the company started with a wider range of
IT solutions than before. In the period of "lockdown" of the economy in relations
with employees and co-workers, the organization switched completely to remote
work. In turn, in relations with customers and suppliers, elements of remote work in
the field of current correspondence (e-mail), invoicing and transfers have already
been implemented. Therefore, the crisis did not significantly affect the specificity
and organization of work.

3.2 Implementation of RPA in Logistics

The implemented project concerned the digitization of logistics processes. Its

assumption is the simultaneous automation of the functions of warehousing,
transport preparation, demand forecasting and administration with the use of bots
(RPA technology).

The implementation of the new solution was preceded by detailed analyzes of the
functioning of the logistics system in the company. The process was carried out in
five stages presented in Figure 1. As part of the process measurement, a broad and
reliable database of information on the costs of individual operations was obtained.
Process mapping contributed to selecting areas that could potentially be robotized.

The key element taken into account in the selection of places for automation are the
results of process measurement - i.e. the hard facts about the cost of elementary
activities. A list of priority processes for robotization has been established. In the
penultimate step, a specification of the robot's operation is created, with an emphasis
on the auto-diagnosis elements, allowing the robot to verify whether its operation is
correct, and the input data meets the automation criteria. The final stage is creating
the specifics and implementing robots.

The approach referred to as outsourcing the creation of a bot was used as the base
method for implementing RPA solutions. The first robot was implemented in 2
months - from the start of measurements of logistics processes to the initiation of its
operation.

In this way, simple activities previously performed manually by production and

warehouse. The owner of the enterprise did not consent for the company name to be
used workers have been replaced by the automatic work of bots. In addition,
automatic machines leading employees through processes (e.g. outboarding) with the
use of MS Power Automate, a new OCR for electronic document exchange, a ticket
system for IT service and VPN (Virtual Private Network) were introduced to ensure
better quality of cybersecurity.

Figure 1. RPA implementation in the selected organization

Source: Own creation.

Bots were used in the implementation of such logistic functions as:

• Tracking and updating shipment statuses - controlling the shipment status

and receiving notifications about the time of receipt, delays, generating an
electronic delivery confirmation, inventory control - carrying out activities
related to inventory control.
• Purchase management - automatic issuing of purchase orders based on the
set criteria of price, quantity and frequency.
• Demand forecasting - analyzing historical sales data, market indicators, by
bots based on established rules, adjusting inventory levels, safety stock.
• Documentation - effective and immediate circulation of documents in the
organization, data exchange, invoice processing, information exchange
between employees.

The team used the services of an external consulting company in the field of RPA
(Robotic Process Automation), which helped them not only to learn automation,
but also to organize the processes, which turned out to be crucial before starting
robotization. Lean Management was selected as the work organization system,
which helped to organize the processes necessary before starting automation work.
It should be noted that there was a resistance of the crew to the changes. Therefore,
the owner held a series of meetings with employees, during which it was explained
what RPA implementation would be, what benefits it could generate for the
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organization and it was ensured that no employees would be dismissed. The

assumption was to facilitate the implementation of tasks and the performance of
duties.

3.3 Results of Implementation of RPA in Logistics Processes in Enterprise

The project was created primarily from the desire to use new technologies to
increase work efficiency and this effect has been achieved. Without changing the
scale of operations (while maintaining similar revenues), it was possible to reduce
the costs completely per year by about 10%. The work is automated and very
orderly, and the same employees, in the same teams, are able to handle more orders
than before. There is also a noticeable improvement in the quality of work, because,
for example, one of the implemented bots is a documentation audit bot that
constantly checks all inventory levels, orders, invoices and sends reports to
employees. Thanks to this solution, there are no errors and everything is corrected
from month to month and not, for example, accumulated at the end of the year.

The changes started with the use of 2 robots, but one year after the initiation of the
changes, there are 19 already functioning in the organization. It was just such a
"selfpropelling avalanche". Especially when employees saw how it works, how it
helps them, how flawless it is, how it deprives them of these tedious duties, they
themselves started to come up with ideas what else can be done.

4. Conclusions

Economic development and growing competitiveness contribute to the fact

thatenterprises are constantly looking for solutions that will increase productivity
and improve the quality of manufactured products. Meeting both of these
conditions is possible for robotic process automation.

Automated processes, before robotization, usually involve significant human

resources and a lot of time. Thanks to robotization, human potential can be released
to perform more creative tasks, the time of performing routine activities is
shortened, and the quality of data is improved thanks to the elimination of human
errors, and thus the quality of decisions made on their basis.

Manufacturing companies are currently operating in the conditions of increasing

complexity of logistic process management. The flow of information supporting
logistics must be more and more precise and take place in real time. Automation in
combination with robot software has a positive effect on the work of the company
by shortening the processing time, reducing human errors, reducing operating
costs, increasing the mutual compatibility of data and greater their accuracy.

The practical part of the article contains the results of a case study on the
implementation of the RPA concept in logistics processes. In this entity, as a result
of the COVID-19 pandemic, a wider range of IT solutions was started than before.
The assumption of the improvement was the simultaneous automation of the
storage functions, transport preparation, demand forecasting and administration
with the use of bots.

In this way, simple activities previously performed manually by production and

warehouse workers have been replaced by the automatic work of bots. The main
benefit was the reduction of costs by about 10% per annum (while maintaining a
similar level of revenues). It is also important that the activities and tasks of
employees have become orderly through automation, and thus the efficiency of the
company's operations has increased. There was also an improvement in the quality
of work.