AI Agents vs. Chatbots vs. RPA: What's the Actual Difference?

The Confusion 

Mid-market companies evaluating automation options encounter overlapping terminology. Vendors describe chatbots, RPA, and AI agents as if they solve similar problems. Marketing materials blur distinctions. The confusion about which technology addresses which operational need is understandable. 

These technologies serve different purposes. Understanding the actual differences prevents misapplication and implementation failure. 

This article clarifies what each technology actually does and when each fits in ERP environments. 

The Core Distinction 

In short:  

RPA executes defined sequences of system actions;  

Chatbots respond to user questions with information retrieval; and  AI agents coordinate multi-step exception processes requiring decision-making within defined rules. 

RPA (Robotic Process Automation): Software that mimics human interaction with systems - clicking buttons, copying data, filling forms - following exact sequences. 

Chatbots: Conversational interfaces that answer questions by retrieving information from knowledge bases or systems. 

AI Agents: Autonomous software that executes multi-step workflows involving decision-making, communication coordination, and escalation based on defined business rules. 

RPA: System Interaction Automation 

What RPA Actually Does 

RPA software performs repetitive system tasks by simulating human interaction with applications.  

The bot logs into systems, navigates screens, extracts data, enters information, and moves data between applications. 

Common ERP Applications: 

• Data entry across multiple systems 

• Report generation and distribution 

• Invoice processing (extracting data from PDFs, entering into ERP) 

• Order acknowledgment creation and sending 

When RPA Works 

RPA works when the process is: 

• Highly repetitive with identical steps each time 

• Rule-based with no judgment required 

• System-focused requiring interaction with multiple applications 

• Structured with predictable inputs and outputs 

When RPA Does Not Work 

RPA fails when: 

• Process steps vary based on context or exceptions 

• Decision-making is required 

• Communication coordination with external parties is needed 

• Rules cannot be defined explicitly upfront 

RPA for Exception Handling 

RPA handles system-level tasks within exception processes but cannot coordinate the exception itself. An RPA bot can enter collection call outcomes into the ERP system. It cannot make the collection call, assess customer response, or decide escalation. 

Chatbots: Information Retrieval Interfaces 

What Chatbots Actually Do 

Chatbots provide conversational interfaces for information retrieval. Users ask questions. The chatbot searches knowledge bases, queries systems, and presents information conversationally. 

Common ERP Applications: 

• Employee self-service (HR policies, benefits information) 

• Customer order status inquiries 

• Product information lookup 

• Basic troubleshooting guidance 

When Chatbots Work 

Chatbots work when: 

• Information exists in accessible systems or knowledge bases 

• Questions are common and answerable with existing data 

• Responses are factual not requiring interpretation or judgment 

• Self-service reduces staff workload for routine inquiries 

When Chatbots Do Not Work 

Chatbots fail when: 

• Questions require investigation across multiple systems 

• Answers need interpretation or business context 

• Issues require coordination with other people 

• Resolution involves making decisions or taking action 

Chatbots for Exception Handling 

Chatbots can provide information about exceptions (order status, invoice details, shipment tracking) but cannot coordinate exception resolution. A chatbot can tell a customer their order is on back order. It cannot coordinate resolution with suppliers, update customers systematically, or escalate issues requiring attention. 

AI Agents: Autonomous Exception Coordinators 

What AI Agents Actually Do 

AI agents execute multi-step processes involving information gathering, decision-making within defined rules, communication coordination, and outcome documentation. The agent operates autonomously within boundaries, escalating situations requiring human judgment. 

Common ERP Applications: 

• AR collections (reviewing accounts, prioritizing calls, conducting conversations, documenting outcomes) 

• Vendor bill matching (comparing invoices to POs, identifying discrepancies, coordinating resolution) 

• Back order management (monitoring status, communicating with customers, coordinating with suppliers) 

• Quality issue coordination (documenting issues, contacting vendors, tracking resolution) 

When AI Agents Work 

AI agents work when: 

• Exception volume justifies automation (20+ monthly) 

• Decision rules can be articulated clearly 

• Multi-party coordination is required (internal teams, customers, vendors) 

• Systematic documentation improves outcomes 

• Human escalation handles complex situations 

When AI Agents Do Not Work 

AI agents fail when: 

• Volume is too low to justify implementation 

• Every situation requires unique expertise 

• Relationship context matters more than process efficiency 

• Emotional intelligence is critical 

AI Agents for Exception Handling 

AI agents coordinate complete exception processes from identification through resolution or escalation. An AR collections agent reviews aged receivables, applies prioritization rules, makes collection calls, documents customer commitments, identifies disputes, and escalates complex situations to accounting staff. 

Technology Comparison Matrix 

Capability	RPA	Chatbot	AI Agent
System interaction	Yes  (primary function)	Limited	Yes  (as needed)
Information retrieval	Yes	Yes  (primary function)	Yes
Decision-making	No	No	Yes  (within rules)
Communication coordination	No	Limited	Yes  (primary function)
Multi-step workflows	Yes  (predefined)	No	Yes  (adaptive)
Exception handling	Partial	Informational only	Complete coordination
Escalation logic	No	No	Yes
Natural language	No	Yes	Yes

When to Use Each Technology 

Use RPA For: 

• High-volume data entry between systems 

• Report generation and distribution 

• Form filling and submission 

• Data extraction from documents 

• System-to-system integration where API unavailable 

Use Chatbots For: 

• Employee self-service inquiries 

• Customer order status lookup 

• Product information requests 

• Basic troubleshooting guidance 

• FAQ automation 

Use AI Agents For: 

• AR collections coordination 

• Vendor bill matching and resolution 

• Back order communication and tracking 

• Quality issue coordination 

• Customer quotation coordination 

Can These Technologies Work Together? 

Yes. Many implementations combine technologies addressing different parts of operational workflows. 

Example: AR Collections Process 

AI Agent: Reviews accounts, prioritizes calls, conducts collection conversations, documents outcomes, escalates disputes 

RPA: Updates collection status codes in ERP, generates follow-up letters, schedules follow-up activities 

Chatbot: Provides customer self-service for payment status inquiries, payment plan information 

Each technology handles its appropriate role. The AI agent coordinates the exception. RPA handles system updates. The chatbot provides self-service information. 

The Implementation Difference 

RPA Implementation: 

• Requires process mapping of exact system interactions 

• Maintenance burden when UI changes 

• Best for stable, unchanging processes 

• Development by technical specialists 

Chatbot Implementation: 

• Requires knowledge base creation 

• Training on common questions 

• Integration with information sources 

• Lower maintenance after initial setup 

AI Agent Implementation: 

• Requires business rule articulation 

• Conversation script development 

• Testing with real scenarios 

• Ongoing refinement based on outcomes 

Common Misapplications 

RPA Misapplied to Exceptions: Companies implement RPA for exception handling expecting complete automation. RPA handles system tasks but cannot coordinate communication, make context-dependent decisions, or escalate appropriately. 

Chatbots Misapplied to Resolution: Companies implement chatbots expecting exception resolution. Chatbots provide information but cannot coordinate action, make decisions, or manage multi-party workflows. 

AI Agents Misapplied to Simple Tasks: Companies implement AI agents for simple information retrieval or system updates. AI agents add unnecessary complexity where chatbots or RPA would work better. 

The Decision Framework 

Ask: What does the process require? 

If primarily system interaction with defined steps → RPA 

If primarily information retrieval and presentation → Chatbot 

If coordination, decision-making, and multi-party communication → AI Agent 

If all three elements → Combination of technologies 

Most exception processes in ERP environments require coordination and decision-making. This makes AI agents the appropriate technology. RPA and chatbots play supporting roles. 

About the Author 

This content is published by ERP AI Agent, a consulting practice specializing in AI agents for mid-market ERP exception processes. 

Published: January 2025 Last Updated: January 2025 Reading Time: 7 minutes