Afternoon Coffee: Many RPA projects fail, report says; Manufacturers plan to reshore production; Grounded passenger planes bottleneck shipping

A survey has revealed that 38% of robotic process automation (RPA) projects fail because they are too complex, Supply Chain Dive reports. The survey questioned 400 senior directors, managing directors, owners and C-suite executives. Roughly 30% of projects fail because the intended processes are not understood, or the underlying automation tools are not fully understood, the report said.

Of the companies surveyed, RPA projects are expected to begin within the next 12 months (31%) or are already present at one-third. Roughly 60% of those surveyed said a strong understanding of RPA processes, or the simplicity of workflow (45%), helped their projects succeed.

Will reshoring increase?

A recent survey has found that 64% of manufacturing and industrial companies are “likely to bring manufacturing production and sourcing back to North America” as a way to avoid future supply disruptions similar to those caused by the coronavirus, Supply Chain Dive reports. The survey was conducted in April with 878 North American professionals in manufacturing and industrial sectors.

Of those surveyed, 28% of respondents in the manufacturing sector said they are extremely likely to bring production and sourcing back to North America. Although many companies are looking at reshoring production to prevent future disruptions such as this, the report noted that some companies see these moves becoming less urgent as economies around the world begin to open up again and supply chains are restored.

European Union economies show COVID-19 damage

Economic damage in Europe from the coronavirus is coming into full view, Reuters reports. Germany, Europe’s largest economy, suffered a 2.3% drop in the first quarter of the year. Meanwhile, France’s economy contracted by 5.8%, and Italy contracted by 4.7%.

Many economic impacts from the coronavirus won’t be seen until the end of the second quarter, since most European Union countries began lockdown orders in mid-March. A second-quarter economic contraction of 10% could happen in Germany when all the information finally comes in, the report said, and a 2% drop in national output is expected year-over-year.

Grounded passenger planes disrupt global shipping

Thousands of passenger planes grounded by the coronavirus are causing a massive bottleneck for global shipping, CNN reports. With roughly half of the world’s air cargo transported on passenger planes, the grounding of 95% of passenger flights worldwide have caused an immediate supply issue.

Shipping companies that use aircraft specifically to haul cargo are running at full capacity, and more freighter jets are being brought into service to help the congestion. Cargo carriers have begun charging about 30% more for shipments. However these moves are not able to keep pace with demand for supplies, and airlines are not currently able to offset the loss in revenue these same flights would have made with passengers.

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