In spite of all sorts of exciting, affordable and easy-to-implement solutions to automate accounts payable processes, the reality is that most companies still rely on outdated accounts payable processes that depend on manual document handling, data entry and approval routing. Odds are, your company is one of them.
According to Goldman Sachs, North American businesses waste $187 billion annually on payment processing costs. Small businesses spend a whopping $22 to pay a single invoice with a paper check. That number doesn’t even fully account for the hidden costs associated with data entry errors, fraud risks and cycle time delays inherent to manual, paper-based processes for AP.
Making the decision to automate should be a no brainer. For companies weighing the cost of adding a staff member just to scale manual processes, that is often the case. But if your company is limping by with existing staff members struggling to keep up with the pace, with little visibility or control over cash flow as part of the process, here are five questions to ask that can quickly get everyone on board with taking a better, automated approach.
The ability to keep up with volumes of vendor invoices as a company grows is one of the main reasons companies evaluate an automated approach. Whether or not your company is on a growth path today, you may want to consider your current volume of invoices to assess whether there is enough volume to justify the investment in automation.
A company that processes fewer than 100 invoices on a monthly basis may be able to manage the process manually. Automation may boost efficiency, but the initial investment may be difficult to justify depending on return on investment expectations. Just north of one hundred invoices per month (particularly for complex, multi-line item invoices), companies often run into process problems that lead to errors, exceptions and process delays—all of which contribute to greatly inflated operational costs.
Under the worst case scenarios, automation can make a bad process even worse by accelerating and compounding errors. Before eliminating manual steps from a flawed process, make sure to map out how invoices are handled, routed, coded, approved and recorded. Look for process bottlenecks and sources of error and delay. Then look to automation.
Automation, properly applied, should streamline and simplify processes, automating repetitive, routine, predictable tasks that are easily handled by intelligent software applications.
You can’t measure your return on investment from automation if you don’t know what it costs you today. Hard costs are easy enough to calculate for paper based processes. Postage, envelopes and paper checks are part of that equation. There are also staffing costs, and time spend not just by your AP team, but by approvers and other stakeholders in the process to consider. Beyond these operational costs, looking at the cost of duplicates and other errors have to be considered.
Automation can’t function in isolation—ideally, it helps your company to get even more value from existing enterprise resource planning (ERP) and enterprise content management (ECM) systems.
An integrated AP automation solution should ensure that accurate data is delivered more efficiently to your accounting and document management systems, delivering better process visibility and reliable access to business KPIs.
Ensuring that you maintain an ERP system that can be integrated with your AP automation solution, and that your AP automation solution is designed to integrated in a way that is flexible and sustainable will boost the value of your entire technology ecosystem.
Implementations that require months of time, tons or man hours and lots of custom coding are a thing of the past when it comes to modern AP automation. Today’s AP automation solutions should handle the majority of use cases “out of the box,” with room for configuration (NOT coding) to address any nuances associated with your company’s processes.
Make sure you understand the implementation timeline and what’s required to get up and running. Ideally, you want a solution that can be up in running in a few months, with ROI achieved inside of the first year.
To learn more about how Artsyl can help you implement a complete, end-to-end solution for digitizing critical documents and streamlined processes, visit our Resource Page at