When it comes to Accounts Payable, exceptions and errors often become the norm at many companies.
When it comes to Accounts Payable, exceptions and errors often become the norm at many companies. In fact, the average AP staff spends 24 percent of its time working directly with suppliers to correct invoice, processing and payment errors, according to an Ardent Partners report, The State of ePayables 2018: The Future of AP is Now. Nearly a quarter of staff time is spent handling exceptions such as disputed payments, missing invoice data, incorrect posting information and matching failures.It’s no secret that manually processing invoices is highly inefficient. Every AP department must contend with a multitude of vendor invoice formats, often from different geographies and volume levels that vary from cycle to cycle. This situation creates multiple downstream processes that increase costs, pose significant risks in terms of data reliability and agility, and lead to lost opportunities for the business.
Most importantly, though, these activities are time wasters that divert employee attention away from the kind of high-value strategic initiatives that drive the organization’s growth and innovation.
The time-saving benefits of Intelligent AP automation
The good news is that the intelligent automation of AP processes eliminates these time wasters and helps businesses work like the digitally enabled company of tomorrow. AP automation frees staff to focus from the transactional to the more strategic aspects of the business, such as data collection, data analysis and the dissemination of this intelligence throughout the enterprise to help drive profitability.
“Automating at least the front end of the process, invoice receipt, and approval, can significantly reduce per-invoice processing costs and invoice approval time,” said CPO Rising, which highlighted the importance of AP automation in its report, Accounts Payable Predictions, “Noting this can result in enormous cost and process savings that can create more opportunity for AP to become strategically valuable to the greater organization.”
Leveraging Intelligent AP Automation
While adding any type of automation to AP processes will free up staff to focus on more strategic initiatives, Intelligent Automation is the true “golden goose” recommended by Ardent Partners. Intelligent Automation includes features such as cognitive capture, configurable workflows for approvals and exception handling, analytics, and integrated ERP.
Analytics are particularly important, providing total visibility into performance and process metrics. A recent CPO Rising article noted the importance of AP automation for business intelligence, “Organizations that take a data driven approach to AP put themselves in a better position to manage their cash flow, accelerate P2P performance, and ultimately drive more value to an organization’s bottom line.”
The AP process contains an enormous amount of valuable data, especially when it comes to managing cash flow. Intelligent Automation provides insight into data around outstanding liabilities, DPO, cash flow planning and even compliance risks. With analytics, AP staff have access to business-critical data, so they can:
- Identify (and correct) bottlenecks in AP processes and workflows
- Catch potential problems early
- Support finance in evaluating the overall health of the company’s cash position
Intelligent AP automation delivers major reductions in invoice processing cycle times and costs, as well as helping to monitor, manage and improve the performance of existing resources. In addition, the data produced by these processes are a strategic asset to the business. Analyzing this data can help in reducing late payments, remove processing bottleneck, improve invoice cycle times, and enhance supplier relationship. With Intelligent Automation, organizations can transform their AP function from a traditional back office transactional processor to a contributor to overall organizational performance and begin to work like tomorrow – today.
