Accounts Payable Automation – Steps to Achievement
In times of economic hardship, learning to do more with less can be the difference between scraping by during the rough times and enduring. Accounts payable departments are no different. Enterprise-level accounts payable automation can transform AP from a cost center into a profit generator—and there’s enormous potential for improved performance. The question is not if AP automation works, but what your expectations for a return on investment, and the time it takes to get there, should be.
Gaining the Support of Upper Management
There are only so many dollars in the company budget, and there are almost always more projects chasing those dollars than the company can afford. Given that reality, if you don’t get buy-in and support from senior management early on, chances are your project may not get approved. Taking this necessary support into consideration, it’s crucial for you to identify the benefits, including ROI, upfront, so that it’s easier to make the pitch.
Requirements Gathering
First, identify where you are today and the main issues or challenges you need to address. Examine which processes are eating up unnecessary time in your department, and what manual processes could be streamlined through automation. This, in turn, drives the creation of milestones, deliverables, and timeline expectations. With full-service automation, the implementation timeline can vary, so it’s important to be prepared.
Selecting an Automation Solution and Provider
Selecting an accounts payable automation provider that fits your business style and budget is extremely important. Though some partial automation services may offer lower initial costs, your ROI may not be as significant, and there’s a good chance that you’ll have to implement more automation in the future. It’s highly recommended to consider a full-service solution that offers comprehensive automation services. Though the price tag may appear heftier at first, your ROI will be much greater, and you won’t have to worry about future costs that come with having to implement additional automation.
Communicate & Get Key Suppliers on Board
Any move toward accounts payable automation will have some impact on your company’s supply chain. Making your suppliers aware of the changes as soon as possible is key to an effective transition. This is especially true if how they’re submitting invoices is changing in any way. Luckily, by choosing an enterprise-level solution, your provider should have a team dedicated to working with your suppliers to get them the updates they need and helping them make any necessary transitions.
Testing and Evaluation of System
Odds are that your chosen accounts payable automation provider already has a set of viable metrics you can use to test against. Even so, you’ll need to develop metrics that are unique to your company’s requirements. These can include such things as:
- Time to process/handle exceptions
- Time needed for resolution of disputed invoices
- Invoices paid on time
- Discounts captured
- Invoice approval time
Ongoing Monitoring and Continuous Improvement
Many people think that once an accounts payable automation solution is in place and running smoothly, that’s the end of it. However, with increased efficiency, you are now positioned to take advantage of newly emerging features offered by your chosen AP automation provider, such as e-invoicing, dynamic discounting, PO matching, artificial intelligence, and machine learning. Understanding this is of vital importance and can further enhance a successful accounts payable automation transformation.