How accounts payable solutions affect your bottom line
Manufacturers, retailers, professional service firms, hospitals, universities, banks, government agencies … The list goes on and on.
Regardless of your organization, we all have one thing in common: We want to produce, sell, treat, educate or simply do more while spending less.
Technology is often the first place finance and other leaders look to improve operations. But certain departments, like accounts payable (AP), tend to get overlooked. While many AP departments were once condemned to a life of paper and back-office bottlenecks, smart leaders have concluded that improving AP operations is a key to saving money and creating efficiencies company-wide.
In this piece, we’ll discuss how AP solutions can impact an organization’s bottom line by breaking them into three crucial areas:
3 ways AP solutions can impact the bottom line
1. Increased efficiency
To improve efficiency, there are a few aspects of AP work that an organization needs to address:
- Increasing invoice volume: Is your AP department overflowing with invoices? Rest assured: You’re not alone.
- Paper complexity: We’ve been discussing digital transformation for years. (Decades?) Still, many invoices arrive by paper or email.
- Transaction times: Regardless of company size, finance teams spend a lot of their work hours processing transactions.
Automate for efficiency
Automating invoice processing with an industry-leading content services platform (CSP) eliminates the excessive time and errors that result from paper-driven AP processes. Regardless of how invoices and supporting AP documents arrive — mail, email, fax, EDI, etc. — an AP automation solution automatically accepts and imports the files into the system.
CSPs are much more than scan-and-retrieve systems. The right solution will:
Extract critical data from imported invoices, like PO numbers, due dates and even line-item details
Deliver that data directly to existing business applications and validate it against existing records
Automatically file imported documents into a single database using the folder structure that you define, ensuring files aren’t lost or in the wrong place
Additionally, workflow management simplifies invoice processing by routing documents and information to the right business units at each stage of the invoice approval process. No more hunting approvers down or tracking progress on spreadsheets.
Benefits of automated AP offices
How does this support your overall bottom line? Here are three ways:
1. Accelerated cycle times: With the right solution, invoices are processed quickly and with fewer errors, regardless of volume and without adding to headcount.
2. Reduced operating costs associated with paper-based processing: By going paperless, you eliminate the cost of storing and maintaining documents. And you can stop worrying about losing or misplacing an invoice. Another perk: Chasing down paperwork is a thing of the past.
3. Improved customer service: When staff can’t locate the information they need to answer questions quickly and accurately, vendor relationships suffer. With content services solutions, staff quickly find the documentation they need to proactively and quickly resolve customer service requests — protecting the long-term viability of vendor relationships.
> Read more | 5 benefits of automating your AP processes
2. Improved access
Trends outside the AP department are affecting how teams operate and interact with their non-AP colleagues. Remote and hybrid work models are now the norm in many industries.
Challenges for AP teams arise when invoice approvals are required from remote employees who can’t access the necessary systems, documents and information, or even perform the tasks required to keep the invoice approval process moving forward.
An AP solution that’s driven by an industry-leading CSP like Hyland’s OnBase helps organizations improve access to information and overcome some common AP process challenges.
Missed connections
The location of employees isn’t the only challenge. Scattered content can also be a major roadblock.
When invoice and payment data is only stored in an ERP or other business system, non-AP employees may not be able to access the information without additional software licenses and training.
Many organizations meet these challenges by giving remote employees access through cloud-based networks and mobile apps. CSPs provide users with the ability to retrieve, approve and update documents and complete forms, with offline support options.
How can this support your overall bottom line? Glad you asked!
Accelerated cycle times
With mobile access, CSPs let remote and field employees quickly access information they need. They can approve invoices or perform the tasks required to move the payment process forward, which helps avoid delays that could lead to missed or late payments and penalties.
And when organizations store all AP documents and data in a single system, the information is instantly accessible when users are back in the office. A central system that tracks all changes in one place improves accuracy, maintains consistency and allows for version control.
<h3>Reduced training and licensing costs</h3>
By integrating with applications like Microsoft Outlook, CSPs allow AP and non-AP business users to view and approve invoices directly from their inboxes. Using familiar applications simplifies user training and speeds adoption by eliminating the need for users to learn multiple, complex interfaces to perform daily tasks.
Organizations save time and money when they don’t have to train employees on complex systems they are reluctant to use.
> Read more | Workday Financials and Hyland: Unify your retail inventory
3. Better visibility
This extends beyond the AP department and those participating in the invoice approval process. A clearer view of AP helps leaders and the C-suite better manage their organization’s financial processes and financial health.
Paper-dependent AP departments are flying blind
Paper documents, or a mix of paper and electronic documents, prevent AP staff from seeing all information related to a particular invoice or payment. Not only are paper documents easy to lose and misplace, but staff also rarely have a holistic view of AP information that lets them know what’s missing, what’s been modified or if anything has been misrouted.
This can jeopardize vendor relationships if issues arise regarding a payment and staff can’t locate the information needed to resolve the problem. Even worse, it can complicate the financial close and auditing processes, putting the business at risk for heavy compliance fines and penalties.
Perhaps most frustrating for controllers, CFOs and other finance leaders is how paper-intensive invoice approval processes limit insight into invoice and payment volumes. This makes it difficult to assess the performance of AP departments and accurately predict cash flowing out of the business.
> Read more | How a content portal enhances invoice process automation
Improve visibility to improve your bottom line
Here are four ways AP automation solutions help finance leaders overcome visibility challenges:
1. Better cash management
With automated invoice processing, AP managers can use dashboards to monitor the status of invoice payments and summarize liabilities for more accurate accrual reporting. This real-time information provides finance leaders with a better view of outbound cash flow, enabling them to better predict and budget for cash requirements.
2. Simplified audit compliance
CSPs help guard against compliance risks by providing a clear and auditable trail for every movement and touch of a document in the payables process. With all documentation in a single, secure location, users proactively identify critical documents that may be missing to expedite the accounting close.
3. Easier vendor and dispute management
You can easily integrate a CSP with existing ERP systems or other business applications, allowing AP staff to view relevant documents without wasting time searching for critical information on paper. Team members will be able to retrieve invoices, goods receipts, packing slips, check images and more — directly from their ERP screens.
4. Informed process management
CSPs featuring reporting dashboards provide more visibility into the status of invoices within the approval process, enabling AP managers with real-time information to identify bottlenecks and balance workload distribution among staff to keep things moving.
Don’t leave AP departments out of your digital optimization efforts
How can you do more with less? Often, the answer is innovative technology.
When organizations search for the right solution, accounting operations shouldn’t be excluded from consideration. The document management, automation and reporting capabilities of CSPs help organizations improve efficiency, access and visibility across the invoice approval process — leading to real benefits to the bottom line.
Learn more about Hyland’s AP automation solutions.
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