Reducing Accounts Payable processing costs has become a movement, figuratively driven by the ability to better allocate staff resources, and literally through automating transactional information and workflows. The real-world implications indicate the need for (and benefits of) increasing both speed and accuracy of processing. Accounts Payable automation is increasingly sought to securely capture all transaction information, with system integrations assuring contractual-transactional integrity, highlights the priority Finance and Accounting professionals are putting towards this accomplishment.
Moving from manual and automated environments increases transaction productivity and cash flow visibility. The numbers behind the automation motivation, provided by a study of AP Management by The Institute of Financial Operations relays cost savings and improved accuracy rank as top justifications for investing in automated accounts payable solutions.
Their peer findings: 9 in 10 organizations still deal, at least in part, with paper invoices and transaction-related documentation, leading to higher costs and lower accuracy.
Other Highlights From the AP Processing Report:
– 80% indicated their volume of invoices increased or remained roughly the same over the past year; 60 percent reporting the bulk of their increase was paper-based
– 80% confirmed half or more of their invoices arrived paper-based; with a majority reporting paper exceeding 90 percent of their volume
– 60% required between 5 and 25 full-time employees for invoice entry and matching
– 70% had unimproved or increased invoice entry and payment error rates change in the last 18 months
– 7 of 10 said that PO automation is an important component of an AP automation initiative
– The most important drivers to automating the management of POs and invoices: a full 60% stated the desire of achieve better control over spend and ensuring purchases are with preferred suppliers, 45% to eliminate mismatches and exceptions that lead to blocked invoices
– 65% noted the average time it takes to process an invoice changed over the past year has increased or remained unchanged
– Just over half captured a significant amount of early payment discounts contractually available to them
– Regarding imaging, 45% reported using front-end document capture capabilities. Only 20% included optical character recognition (OCR) to replace manual ERP keying, with a mere 10% having data extraction and utilization capabilities (enabling ERP-integrated invoice validation, and direct entry into automated workflow).
Making Your Organization More Competitive With Lower Accounts Payable Processing Costs
Those stats indicate the state of the industry. How close is it to your environment’s reality? If nearer than you’d like, your automation advantages encompass:
- Eliminating manual invoice data entry to your ERP
- Reducing your costs associated with processing and filing vendor invoices by 75%
- Increasing automation and streamline your processes via workflow, reducing cycle time by 80%
- Increasing visibility into your AP processes through intuitive, decision-enhancing reports
- Reducing the risk of late payment fees you pay
- Increasing the amount of early payment discounts you receive
- Keeping your specific processes – simply automate them to achieve these results.
How to reduce accounts payable processing costs – real-world, real benefits? Here’s how: this 3 ½-page AP automation guide relays the steps: bit.ly/2dDbIjk.
For more, see IntelliChief ECM for Accounts Payable.