Automating Accounts Payable
and Accounts Receivable

Where to Begin and What to Expect When Automating the Back Office

When it comes to automating back office processes, the two most common, high-volume, labor-intensive candidates for intelligent automation are vendor invoice management for accounts payable, and customer sales order processing for accounts receivable. Both are target-rich when it comes to opportunities to target and eliminate waste. One affords the organization better opportunity to manage cash (by increasing visibility) and cut costs; optimizing the other accelerates the sales and fulfillment cycle, enhancing the customer experience and bringing cash in the door more efficiently.

Intelligent process automation solutions focused on accounts payable emphasize taking the pain out of the internal process of sorting and handling vendor invoices and gaining control over the process, while intelligent accounts receivable automation for customer orders focus on helping vendors to accelerate fulfillment while making it easier to gain more timely insights into customer buying behavior and trends.

Intelligent solutions to automate process bottlenecks and potential sources of error for either process can be delivered by a common platform—one that is capable of identifying the relevant transaction documents (invoices, orders, etc.) and actionable information within those documents, while integrating with ERP and other business systems to validate the data and create a workflow for approval and transaction entry into those business system.

Often, once a company has applied intelligent process automation to one part of the business and ROI had been achieved, automation can be applied to another process, leveraging a platform that has already essentially paid for itself.

The question becomes which to tackle first. In most cases, that answer can be derived from where there’s the most pain. The results, when more than one system is automated, are often greater than the sum of their parts.

Two great candidates for intelligent process automation

Industry survey data backs up the notion that AP and AR present the best candidates (and the best returns) for intelligent process automation. A survey from Invoiced and CFO Dive revealed that accounts payable (49%) and accounts receivable (47%) have the highest penetration of automation technologies.

In both cases, automation served to deliver faster process times and lower costs, but the most significant measurable business impact was on cash management. In both cases, better management of the process, with reduced cycle times and more timely access to process KPIs can help to improve a company’s cash position.

Keeping in mind that 82% of companies fail due to cash flow problems, we can all appreciate how critical proper management of these processes are—and why BOTH processes should be treated as more than just cost centers.

Automating AP & Vendor Invoices

Vendor invoice automation is the most commonly-automated back office process for good reason. A classic scenario often leads companies down this path: they reach a point as the business grows where the decision arises to add another AP clerk to keep up with the pace of business.

Benefits of vendor invoice automation include:

• Increased accuracy and fewer errors/exceptions, because these systems can automatically validate data extracted from invoices, by cross-referencing vendor records and applying algorithms to ensure that totals match and that there are no duplicates
• Improved accessibility and auditability results from having digital records of AP transactions, tied to digital images of source documents, along with a digital audit trail of approvals and actions
• Optimized employee efficiency by relieving them of most document handling and data entry work allows a single employee or a small team to scale to handle growing, or uneven workloads, while giving them the capacity to do more value-added work like pro-active planning, analysis and vendor communication/coordination.
• Improved process visibility, allowing AP teams to focus ongoing beyond individual and process efficiency to monitor and manage the metrics that matter, like cash flow, cash on hand and operational costs.

Automating AR and Customer Sales Orders

Customer sales order automation has been proven to radically reduce process cycle times by automating document sorting and data entry. Automating these tasks shortens days sales outstanding (DSO) which gives the supplier more control over their end of the equation when it comes to securing payment.

Benefits sales order automation include:

• Reduced payment processing costs, achieved by eliminating manual data entry, document sorting/handling and dealing with errors and exceptions from a flawed manual process
• Accelerated payments by reducing days sales outstanding (DSO) and tightening up the whole order fulfillment and payment cycle
• Enhanced customer service by anticipating customer needs and delivering products/services more efficiently
• Greater competitiveness by translating timely business data extracted from orders into insights about market demands, buyer behavior and broader trends in a way that helps better manage inventory and adjust to changing market trends

Whichever you choose first…take action with Artsyl